>> Pacemaster’s retailer who laid it all on the line at the company’s annual dealer costume party each won a treadmill for their daring at the festivities at the Health & Fitness Business show on Aug. 19. First place went to Chris Newman of the Fitness Depot in Calgary who was dressed to the hilt as Johnny Depp’s character in the Pirates of the Caribbean (albeit a tad skinnier, SNEWS® thought). Lewis Noppers of the Fitness Depot took second place for his Dr. Oct Spiderman character. The affable Judy Griffin swooshed around the room as a third-place winner for her Mae West costume. Another special Karaoke prize went to a retailer who, as we reported last week, spent the evening in his tightie whities prancing around the room with just the topper of a button-down shirt posing as Tom Cruise’s character in Risky Business. We hear he wanted to remain anonymous — such shyness after showing off a lot of skin (and other things) for hours? Taylor (American Home Fitness), we know you aren’t really such a wallflower.
>> McDonald’s went for the gold in Athens, Greece, unveiling its Go Active! Day during the Olympic summer games to showcase its commitment to active balanced lifestyles through worldwide initiatives. The foundation of its healthier mission focuses on menu variety, supporting physical activity and providing consumer nutrition education. The event featured Olympians and past gold-medalist track stars Carl Lewis and Jackie Joyner-Kersee and included a donation of 25,000 stepometers to the Greek Ministry of Sports for the children of Athens — likely the same stepometer that is in the adult Happy Meals (see SNEWS® story, July 1 — “Get happy with McDonald’s Go Active Happy Meal for adults”). So far, McDonald’s has distributed 30 million stepometers to customers in Europe, the United States and parts of Latin America. The company also tries to educate customers around the globe with nutrition information on tray liners, leaflets and its website, as well as establishing Ronald McDonald School Fitness programs globally, including partnerships with National Olympic Committees in Canada and The Netherlands. Also on the list are partnerships with world-class Olympic athletes and role models from around the world, which must include Olympic race walker Robert Korzeniowski who won his fourth Olympic gold medal in the 50-kilometer (31.1-mile) racewalk. The 36-year-old World and European Champion from Poland, whom McDonald’s in a press release called a “walking legend,” took the event in Athens with around four minutes to spare over Russian Denis Nizhegorodov and his countryman Aleksey Voyevodin.
>> As we reported the week of Aug. 17, Sears.com has entered into a partnership with GSI Commerce specifically to expand its brands and variety of fitness and sporting goods products online. (GSI Commerce runs e-tail websites of, for example, The Sports Authority, Dick’s and Fogdog.) In a chat with Michael Conn, GSI Commerce director of business development, SNEWS® was told the brands and product would supplement current Sears product, but Sears would maintain control over its own website while simply adding product available to GSI through its other partnerships. “We have this tremendous assortment of sporting goods and the ability to ship directly to consumers,” Conn said. “We can expand (Sears.com’s) assortment.” The brands to be fed into the Sears.com site hadn’t been determined as of Aug. 24, other than a few non-fitness ones such as Rawlings, Wilson, Spalding and Huffy. “This is still evolving,” Conn said, noting that the deals so far arranged only indicated bike, team and golf brands. Conn said GSI must talk to brands and see whether also being on the Sears.com website is something the company desires. “We always take the approach to respect the brands’ own distribution,” Conn said. At this time, Sears offers fitness brands such as Icon brands and Horizon’s CFS brand. On GSI-run Fogdog.com, for example, one also finds Star Trac, New Balance equipment, Keys, Horizon, Bally and Linex equipment. The point is to help Sears become what it used to be in the sporting goods world, Conn said. “Several years ago, Sears offered a more extensive assortment of sporting goods in the stores and many people associated the Sears brand with sporting goods,” he said. That changed over the years, and the fitness and sports areas shrunk, but recent Sears strategy is to upgrade and emphasis those areas again. GSI, it seems, will be a part of that strategy. SNEWS® View: It’s going to be interesting indeed to see what fitness equipment brands from other GSI-run websites will slowly wend their way onto Sears.com. We’ll certainly be keeping an eye on the site.
>> In the days after the closing of the sixth-annual Health & Fitness Business Expo on Aug. 21 (many stories say eighth annual, but that includes the first two years of the show when it had a different name and was run by a different entity), VNU organizers said there were about 2,500 total attendees, which includes exhibitors, media and others. On Aug. 23, SNEWS® already reported about 1,100 buyers from about 500 stores (see details in Aug. 23 story, “HF Biz show buyer numbers steady, exhibitors up”). The show also had two live broadcasts from the floor by the Denver NBC affiliate, Channel 9 News.
>> GERMANY — Horizon Fitness in Germany has taken part in a “Super Cup” competition for retail staff organized by the VDS (a German trade group for sport retailers), done in cooperation with trade publication sport+mode. Participating brands in different sporting goods categories are represented, with Horizon Fitness being the only fitness equipment brand. In the sport+mode publication, four-page inserts are included monthly with “just-the-facts” technical information about each brand, with sales staff filling out questionnaires related to the information. The best ones (about 30, SNEWS® was told) are invited to attend an off-site seminar where participating brands give a workshop after which the sales staff all take another test. The top-scoring attendee is named “Best Sporting Goods Salesperson” and wins Euro 1,000 (about USD $1,250). In Germany, Horizon is also active in training other stores’ staff, including top department stores such as Kaufhof and Karstadt. “All these seminars are very efficient for us, because it’s the first time we will reach bigger groups of sales staff all at once,” said Horizon’s managing director Ulfert Boehme. “Normally our sales reps have to travel to each and every store for training. This way, we get directly to the people who influence which kind and brand of equipment the customer will eventually purchase.”
>> The United States isn’t the only country facing an obesity epidemic. An estimated 200 million Chinese will face obesity challenges in just 10 years time and Bally Total Fitness is answering the call, opening its 10th Bally franchise in China through a joint venture with China Sports Industry. Located in Shijiazhuang city in Hebei province, the new 45,000-square-foot location will make Bally the largest chain of fitness centers in China. “The newest Bally Total Fitness facility in the Hebei province further reinforces the fact that fitness is quickly becoming part of the modern Chinese lifestyle all across the country, not just in the larger cities,” said Paul Toback, president and CEO of Bally. “With rising obesity rates and an urgent need for an emphasis on health and fitness, there is a tremendous market in China for fitness centers such as Bally Total Fitness….”
>> CANADA — The Sears Canada board of directors has appointed a longtime Sears Canada executive, Brent Hollister, as president and CEO. Hollister currently serves as the company’s president and COO. In addition, Glenn Richter, executive vice president and CFO of Sears, Roebuck and Co., has been appointed board chairman of Sears Canada. He will continue to serve in his Sears, Roebuck and Co. role. The contract of Mark Cohen, who had been chairman and CEO of Sears Canada, has been terminated by the board as a result of strategic differences about the future direction of the business. Sears, Roebuck and Co. owns approximately 54 percent of Sears Canada, an independent, publicly traded company.
>> It’s that time of year for clubs to be sprouting anew and expanding their businesses — all in time to get the kinks out and rack up new members during the post-holiday “get-my-waist-back” and New Year’s resolution “lose-the-fat” rush. Those include Equinox, LA Fitness and Life Time Fitness, but we know they aren’t alone. Equinox Holdings is on the growth warpath with plans to operate 25 facilities by year’s end. It’s already opened four new clubs in early 2004, including flagship locations in New York and Chicago. The 42,000-square-foot New York club is in the Time Warner Center in Manhattan and has the company’s first Elite Training Center known as “E.” The Chicago flagship is in the 800 North Michigan Avenue building. An infusion of funds from two private equity firms, is also allowing Equinox to open three more locations later this year in San Francisco, Santa Monica, Calif., and Mamaroneck, N.Y. Equinox CEO Harvey Spevak said in a statement: “There has been a huge demand for an innovative, value-based fitness facility in a number of urban cities where the market is under-served. By launching in several new markets, our aim is to meet the needs of a discriminating consumer who demands the best and currently doesn’t have the opportunity to get it.” In 2005, Equinox plans to open seven additional facilities including California clubs in San Mateo, Newport Beach and a 40,000-square-foot flagship in Los Angeles, servicing Westwood, Brentwood, Beverly Hills and Bel Air. LA Fitness, based in Irvine, Calif., is expanding its reach and is set to roll out 10 to 12 health clubs in the next three years in the Dallas-Fort Worth area. Each facility is projected to cost $7 million to $8 million a piece. A spokesperson said it’s entering the Dallas market because of “the amount of economic growth there and the type of people in Dallas.” It also plans to enter Austin and Houston in the near future. The first facility should open in the next six months in Frisco and be 45,000 square feet. As we reported last week, Life Time Fitness signed on the dotted line and bought a 22-acre site in the Arboretum Business Park in Chanhassen, Minn., for its corporate campus headquarters. First up is a 109,000-square-foot health club that will reportedly cost $22 million to build. The new location will expand the number of Minnesota-based Life Time Fitness centers to 15. The company currently operates 35 centers in eight states, including Arizona, Illinois, Indiana, Michigan, Minnesota, Ohio, Texas and Virginia.
>> A recent survey conducted by BIGresearch and reported on CNNmoney’s website, backs up what we’ve been saying for a long time: Customer service is king among shoppers. “Obviously price is key to determining where people choose to shop. But after that, it’s customer service,” Phil Rist, vice president of strategy for market research firm BIGresearch, said in the article. With too many retailers chasing too few consumer dollars, Rist said, merchants can get a leg up on the competition, if they learn to court the customer in simple ways. How so? Having a helpful and polite staff and well-organized and clean stores go a long way in winning over shoppers. “Shopping is a sensory experience,” said Rist. “People are subconsciously recording things like the layout of the store, the lighting, whether the aisles are overflowing, whether the prices are clearly indicated and how easy or difficult it is to find a product every time you visit a store.” BIGresearch took it to the people and polled 8,701 consumers between June 1-4 and asked which retailers had the most and least courteous employees. Wal-mart and Target took slots one and two, followed by Home Depot and Lowe’s. Least courteous “honors” went to Nordstrom (!), Sam’s Club, Walgreens and Costco. Some factors that annoyed people the most, even prompting them to switch to another store, were rude behavior, salespeople who were unfriendly or weren’t around to help, and staff that wasn’t knowledgeable about the store or the products, BIGresearch noted. SNEWS® View: OK, so we certainly raised our collective editorial eyebrow when we heard Wal-mart and Target garnered top honors for polite staff and well-organized and clean stores. While we can see Target garnering the nod to a point (think of its beloved nickname with the French pronunciation — Tar-jay), we’ve yet to find a Wal-mart that doesn’t leave us feeling as if we need to pick our way through the aisles past piles and send up a flare to get help. Still, the message is clear — the simple power of an engaging smile, common courtesy and a helpful staff scores big with consumers.
>> In a recent story in the Seattle Post-Intelligencer called “Survival of fittest in world of retail,” columnist Bill Virgin writes that one could study American retailing over the last 50 years, rather than Darwin and theories of evolution, for a good picture of today’s world. “Some retailing species made their appearance and survive to this day. Others flourished, then declined, or morphed into something else. A handful disappeared into the fossil strata,” Virgin wrote in the Aug. 26 column. “Now some questions have been raised about the long-term prospects of one of those retailing types — the category killer.” The category killer is aka big-box retailers that emphasize one line of goods such as home improvement, consumer electronics or sporting goods. “Just as the first generation of discounters took over … the five-and-dime stores, so the category killers claimed their space by grabbing it from department stores and the discounters by offering broader inventory and often lower prices than competitors could,” he continued. That included Toys “R” Us, which is now suffering thanks to the likes of Wal-Mart, Target and websites. “Have category killers themselves become chum in the shark tank of retailing? Do the woes of Toys “R” Us bode ill for its compatriots in that segment? After all, what’s to keep Wal-Mart and ilk from doing the same thing to everyone else?” Said Gus Valen, chief executive of Cincinnati-based strategy consultancy The Valen Group, in the story, “The categories that are consumer-oriented and price driven, Wal-Mart is going to be extremely successful (in). … Wal-Mart is going to pick the categories where they think they can win.” To read the whole story, click here.