Gen Z continues to drive membership growth. planet fitness.
Thanks in part to the company’s efforts to recruit high school students, this age group now makes up 25% of the fitness chain’s membership, management said during an earnings call Thursday (February 22).
“We aim to be the brand that Gen Z thinks of when they are ready to join a gym. [and] This program also [strengthens] This is our appeal,” Interim CEO Craig Benson said on a conference call. “Our business is unique in the retail industry because gym memberships are not frequently purchased items.”
The question analysts had for management was: “What impact does this have on the future of the company?” For example, Joe Altobello and Raymond James wanted to see if there was a difference in average lifetime value between younger and older member groups at Planet Fitness. That’s assuming these younger members haven’t signed up for the chain’s more lucrative black cards.
Chief Financial Officer Tom Fitzgerald acknowledged that the black card mix tends to be lower among younger users.
“But if you look at different ages of Gen Z, you’ve probably heard that there’s a step function change in black card penetration as you get older,” he said. “And once they reach their 20s, roughly 60% of them become much more similar to the average black cardholder. So even if the mix of black cards was slightly lower, contract values would still attract new members. We’re going to keep that deal going all day long because it far exceeds the cost to acquire it.”
PYMNTS Intelligence says Gen Z consumers are more discerning consumers, comparing prices online, actively seeking discounts, and drawn to brands that offer a combination of quality and affordability. I discovered that there is a trend.
Additionally, your financial situation has improved over the past year, making it more likely that your income will increase this year.
Planet Fitness announced at its financial results conference that Mr. Fitzgerald will be retiring as of August of this year. He also said he continues to search for a permanent CEO. Benson said the company’s hiring committee has narrowed the list of more than 100 candidates to a list that will be announced soon.
