The 99ers and the Health Club Industry

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I was getting the Sunday blues last night when I saw a report on "60 Minutes" about people who have the Sunday blues every night.

This group is called the "99ers," or people who have exhausted their 99 weeks of unemployment benefits. These are not people who are simply relying on the government for food stamps to help make ends meet. These are out-of-work professional people, almost all of whom have a college degree, and some have master's degrees and doctorates. These are people in their 50s and 60s who had good-paying jobs, some earning $70,000 or more, before they were laid off. More than two years later, they're still out of work. Their 401ks, their IRAs and their savings accounts have all dried up.

The 99ers featured in this report live in the San Jose, CA, area. Some of them go to free food pantries. One woman was happy—happy—to earn $30 from a recycling plant after pulling out bottles from trash cans. Utterly disheartening.

So what does this mean for the fitness club industry? We hear that the Baby Boomer market is the one to target for health club operators. They're the ones (about 46 years old to 64 years old) who have disposable income and can use some exercise for those creaking joints and sagging muscles.

Well, guess what? A growing number of those folks don't have the money for health clubs right now, and they haven't had the money for more than two years. Future employment looks bleak. They're going after three or four menial clerk jobs in their areas that 2,000 others are applying for, too.

The industry really needs to re-focus its target market. The industry consensus is that 85 to 88 percent of Americans don't belong to a fitness center. There's a reason for that: Most of them simply don't want to join.

It's time to go after the young, the Generation Ys (teenagers to those around 30 years old) and the Generation Xs (those in their 30s to early 40s) who are already club members. The 30-somethings likely have young kids, and that's an important demographic for the future of this industry. These two groups have that disposable income, are used to coming to the club and haven't yet had their livelihoods, hopes and dreams absolutely crushed by this depressing recession.

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