(11) Jim Crowell - The Business Side of Fitness...and Avoiding the "Nuclear Option"

What's up, Fitness fans? It's Eric Malzone with the Future Fitness Podcast and the Fitness Marketing Alliance. And this is episode number 12. I am talking to Jim Kroll. He is the CEO at OPEX. And this was a really fun and intriguing conversation because I love the business side of things and I love the marketing side of things. And uh Jim's brain works that way. He uh we we talk about the absolute necessity for advertising and marketing, right? And how going uh with the nuclear options of shotgunning your your advertising is isn't the way to go for a sustainable business. We also talk about uh trends as far as functional fitness and crossfit and and where the trends are going and uh how it could mean trouble for some and how some are getting it right. And if you are a fitness professional, which you probably are, this is really worth your time to listen to all the way through because you're gonna pick up a lot of nuggets here that will tremendously help the trajectory of your business. And I highly recommend it. And uh Jim is an overall great guy. Um he also owned two facilities uh in his time before selling and then moving out to Arizona work uh as CEO at OPEC. So um dig in and uh before you do that, let's talk about our sponsor. So Busy Bar. And they have three flavors peanut butter, my favorite, cookie dough, double chocolate chip, and only one gram of sugar. So for all of us busy people, this is the one to use when you're uh when you need a little snack, a little pick-me-up. It's made of the highest quality protein available uh with grass-fed whey, and it's only six net carbs and nine grams of fiber. And you can go to busybar.co and you can enter in the uh promo code FMA10, as in Fitness Marketing Alliance 10, and you will get 10% off every order until the end of time. So go check them out, uh, support those who support us and enjoy this interview. I know I did, and I'm sure you will too. Everybody, it's Eric, Fitness Marketing Alliance, and today I have the absolute pleasure of sitting with Jim Kroll, who is the CEO at OPEX. Uh Jim, thanks for coming on, man.

Yeah, thanks for having me, Eric. I'm looking forward to it, man. We always have good conversations.

We do, we do. I uh I know you a little bit, right? I've I've got to uh hang out with you and talk you know personally and with business, but I I kind of see two different gyms, right? I see Jim Sport Athlete, Jim Businessman. Can you maybe uh start with Jim Athlete sport and talk to me about that, and then we'll get into the business side.

Well, I mean, that that might be um uh a bit of a historic reference because I I certainly am not the athlete that perhaps I once was, but um I did go to regionals uh for the CrossFit Games in 2014 as an individual, and then with OPEX I went to the games on a team in 2015. Uh and since then I have uh advanced my career directly into the health and wellness uh department. So the athletic side is more for kind of fun and more for just making sure that I'm making progress where I want to be, which honestly is more so on the business side. So I'm just pushing on the health and wellness side of it in the gym.

Uh what region were you in when you did individual?

Mid-Atlantic, and I got smoked as an individual, so it was a good experience.

Yeah, those guys are pretty good. Just making it to regionals now is is incredible. I mean, you you just have to be a freak, you have to train a lot too. How much were you training at that point?

Um I was going about an hour in the mornings, five about five days a week, and then I had two and a half to three hour sessions, generally right around the middle of the day, so 11 or 12 o'clock start. Um, and that was another five days a week, so at at least at least 10 sessions a week. Um, which at this point, you know, for a games athlete is not that much, but you know, for for most human beings, it's a good amount of training.

That's a ton of training. Excuse me. Did you have a coach? Did you have some coaching you?

Yeah, I I mean I did my own stuff way, way, way back in the day. Um, and then when I started to learn about OPT at the time, um, I met James, and then James coached me uh as I went into regionals individually, and then I moved to OPEX to start working here. It had gone from OPT to OPEX. Uh, and then Mike Lee coached me uh for about another year. And since then I've had Robin Lyons coach me as well. And so I just I I've enjoyed some different coaches from OPEX over the years.

Cool. So let's switch to the other gym. Let's talk to Jim, the businessman. Um, I know you've you've owned some businesses, um, but walk walk us through that history.

Yeah, well, I mean that that probably starts when I was a kid. I I I always had sort of a uh a deep interest in how business worked. I had a I went way down the rabbit hole, 15, 16 years old, when terms of stock trading and and trying to understand that whole game. And then in college, um, I was a double major in finance and economics. I went to Penn State and played tennis there, so I did have some athletic background. Um, but when I got out of there, I was a I became a hedge fund trader. So I was trading natural gas, crude oil, all that stuff for a hedge fund for about five years, and and that's kind of what took me to Austin, Texas, which is where I found CrossFit. And I always tell the story I had a great trainer, his name's Miles, and then I went over to CrossFit Central with Jeremy Teal and Carrie and all those guys. Um and then when I was there, I I I was really feeling like I wanted to um to get out of the finance game. And you know, I had great experiences there. I learned a ton about the world and finance and in trading, but I maybe it's maybe I had an inner confidence about myself where I thought that I could be successful doing anything, you know, or maybe naive was a better word. Um and so I really got into the idea of CrossFit, and if the big thought process in my mind was there's no barrier to entry here, you know. So back in 2011, sorry, sorry, sorry, back in 2009 is where I started kind of learning about it. And then in 2010, I I instead of staying in Austin, because I didn't want to, you know, those were buddies of mine at CrossFit Central. So instead of opening up, you know, across the street, I went back up to where I went to high school in Pittsburgh, opened uh my first CrossFit gym with a buddy of mine from high school. Um, we grew that into a pretty big operation, opened a second facility in downtown Pittsburgh, grew that into a pretty big operation. Um, I think all told we had about, you know, when I sold my shares off, we had about 500 clients between two gyms and had built it into something that was really great. And I I enjoyed it. But what what I really started to enjoy was, you know, the business aspect of it. And I think maybe where your question was going is I always default to business. So one of the things that we talk about in OPEX and CCP and life coaching is you know, where are you consistent? Where do you spend your time? Where do you prioritize your time? And for my entire life, it's always been prioritizing towards growth and work. Um, and you know, say what you want about that, but that's what I like to do. And so for me, I've I've just really enjoyed the process of understanding what fitness is, what it is in business context, how gyms are built, how the business of fitness is built, um, how partnerships in this industry are very different than in the financial industry and any other industry, um, how it connects to health and wellness and how it doesn't actually connect to health and wellness. Um, and so I've had a really interesting time kind of digging down that rabbit hole. And when I came to OPEX, I was actually, I started as a coach even after I sold my businesses. Um, and so I kind of tell a funny story where it's like I got here and almost instantaneously I started looking for what I could fix because that's just kind of where I go. Um, and that sort of just turned into an evolution that that led me into being the CEO of OPEX. And it's just that's a perfect fit for me. Um, I love being in the fitness game, but truth be told, I prefer to play on the business side as opposed to the pure coach. You know, so if you look at me versus Mike Lee, it's clear as day who should be where, right? The guy is an unbelievable coach, he's a deep passion for it, and I'm on the flip side in terms of the business, where it's like we're both in very, very solidly aligned roles. Um, and so I've really enjoyed that process of learning and growing and seeing other gyms now through the licensing program um grow up.

That's um that's it's a really cool point because I think it's a huge point of self-realization. Because as when I own my gym, now I would ask people all this time, because you you really do see two types of people getting into the industry, right? You see coaches who have to learn business, and then you see businessmen who have to learn how to coach, right? I was I was the second. I got in, I was like, you know, I really enjoy the business side of it. In fact, my partner, um, my old business partner, Traver Boehm, he's the one who pulled me in. He's like, I just need I just need you to run the business. So I'm like, well, what does that mean? Like, that's that's a lot. You know, he's like, No, you just run the business. Like, that's it, no big deal. I'm like, well, no, there's a lot to it. And uh I always equated too, because when I was growing up swimming, we would say that there are um swimmers and then there's athletes who swim well, right? So I kind of see like you know, in the fitness industry, there's business businessmen who just choose fitness, and I kind of see that's that's where you are, and you realize that it took me a little while to realize that because I always wanted I had this grasp on like I want to be a great coach and uh educated the shit out of myself on it, but in my heart, I always wanted to do the business side of it, and that's kind of where I am now too. Um and I think what we can really talk about today, which is really interesting, is the business of fitness, right? I think it's um it's so young, but this industry's 40 years old, max, you know, really.

Yeah, well, I mean, James, you know, you've spoken to James about this very recently, and and he's a huge proponent, I should say James Fitzgerald. Um, he's a huge proponent of understanding the real deep history of fitness if you're a coach. And so it's fascinating to think about in the last 10 years, CrossFit's completely changed the entire industry. You know, I mean, completely changed it, where all of the big box gyms, LA Fitness, Gold's gym, they all now have to pay attention to it because people now have an interest, and I won't even say athletic, I'm gonna say able to do things in fitness that they had no interest in doing 10 years ago. So I don't even just mean a barbell, I mean a kipping pull-up or a muscle up or a rope climb or something like that. That just wasn't in the psyche of most people. And for you and me, as business people in fitness, we have to recognize that evolution because what's gonna come next is gonna feel like something totally different. You know, so if you look at, I just take an example of curves, right? I remember when I was what, maybe 12, 13 years old, it's like curves was gonna take over the world. You know, remember how fast they grew that franchise? I mean, they had thousands everywhere, everywhere, right? And then I swear to God, overnight it's like somebody burned them all to the ground.

Yeah.

I mean, I I have to this day I'm trying to figure out the rise and fall of curves just because it's it's wild to me. Um, but you have so many examples of how the industry or the game was changed, and then what happens is most of these models in fitness have no longevity. So if you look at what the most long-standing fitness business is, it's yoga. Really, at the end of the day. Now, maybe somebody wasn't making money in yoga a long time ago, but people have been doing yoga forever. Right. So one of the best businesses around in fitness is yoga in terms of the numbers, right? Because I can put 40 people into a thousand square feet and say, hey, it's better that you sweat all over each other because that you know it it gives you togetherness or whatever. And now I can put 40 people times $30 a class every hour and pay an instructor 40 bucks. You know, so I'm not saying that's the model that most people want to go with, but it's like the business of yoga makes perfect sense because the numbers add up. You know, so a lot of these models, the numbers ultimately don't add up for somebody, and so that's where our big mantra and ethos right now is what's happening in fitness over the last 10 years is not sustainable for a coach. And I don't mean an owner, I mean a coach. So generally, what that's gonna look like is the coach churn is gonna start to look the same as the client churn, and that's where it starts to get really uh interesting, not necessarily in a positive way. Because if a coach can't stay in a facility, every time they walk out, clients leave because they are the front-facing uh person in that facility. So, you know, to not go too deep down a rabbit hole, the history of fitness is one where we need to see why it changed and how did the connection to coach or client, or how did the connection to towel service and uh five showers and everything, how is it different? Like what CrossFit did is it put some grit into fitness, but that grit was also met with community. So it's really interesting, right? So it's like you do have this Lubby W, and I'm saying that in a positive way, you have that, you have that cultish feel inside of a community, tribal style, right? But you also were able to put it into a facility that from a cost structure made sense because you were in a warehouse at $2,000 a month. What's changed in the last couple of years is everybody thinks they need a 10,000 square foot, 15k a month facility. Now you're competing with the big boxes, and that's where most people who are coach owners who really aren't business people, that's where they'll get buzz-sawed because they don't know how to compete against a low-cost, high commodity product, which is Planet Fitness, LA Fitness, all those different places. They're not gonna beat them in amenities. Impossible. They just don't have enough cash.

And I agree. I, you know, when I own my facility, I really did my best, right, to make sure that I can I had a place where coaches could actually make a full-time living. And that's that's not an easy task. No, it's hard, right? It really is. I really wanted to have coaches stick around for a while. And at some time it was it hurt me personally and financially because I would uh try to do things that um you know maybe didn't all the pieces didn't fit, right? And you see all these different models coming in. Um I'm not gonna name them, but you know, where they talk about this piece of pie and then you know, giving all these slices of pie away to different pieces, you know, for for the coaches to the owner, to you know, percentage-based, and then you're like, well, that pie's not big enough for that. And that's the other pie is just not big enough for that particular thing. So uh when you look at uh and what I love about you guys are doing is you're really uh focusing on uh making uh coaches um the have the opportunity to make it a profession. Like you can actually make a living at this, right? You can do this. This is what you're passionate about, you can do this. Uh you look at other countries that were so far behind, right? I mean, you look at like a Russia or China, people like this who have uh coaching where you actually go have to go through a three-year degree, you have to go to school for it, you have to get a license, right? Here an online course in a matter of 12 hours will get you there. Um so now I'm ranting a little bit. So when you look at these, uh when you look at fitness professionals and the industry as a whole, right, uh, and you compare it to more established um sectors of business, where do you think the fitness industry has the biggest blind spots? Right? Where is the average uh gym owner or fitness professional? Where are they blind and what do they need to be looking at?

Well, um James and I did um uh a large summit a couple days ago, and he brought up a really interesting point. Um, is that many people believe that they're the center of the universe. You know, so if if I'm doing this style of training, whatever the style is, if I believe that that is the only way to do fitness, that is very naive. Now, certainly you might have a bias, and perhaps it's a good bias to say it's the best way of doing fitness, but if you're not open to there being other ideas, that's a huge problem, and I do think that that's a blind spot specifically in functional fitness. There are numerous ways to perform fitness, there are numerous ways to lose weight and cut body fat and get stronger. So people need to be open to the idea that maybe it could be done in a different way, and possibly, depending on the human being that is a client, it might be better for them to do it in a different way. So it's really important that somebody doesn't have a blind spot of being unwilling to recognize that there are different ways to skin a cat correctly. And I think that that's crushed a lot of fitness businesses over the years, is you know, they think that there's only their way, and especially something very fad-related, right? So think about how many different styles of group-based fitness there have been in the last 20 years. I mean countless numbers, right? From different styles, there's 50 different styles of cardio kickboxing and cardio boxing. Like I don't even know what the format is anymore, right? Um, and so if that's the only way that you think you can do business, that's probably not the best way to do it. But you know, one thing that we would say is really important is where people have a blind spot is they're not actually creating relationships. So there's not actually a coach-to-client relationship, but that's what they're trying to sell. Um, and that I think is hugely detrimental to a fitness business. So we talk about this a lot in that you have to know what model you really want to go in, right? So I'll go back to the yoga model. And by the way, yoga is a fantastic thing. So I hope I didn't sound like I was coming down on it. Um, but let's go back to yoga for a second. If I wanted to go into a model where I really didn't have a big touch point on clients, I would put as many bodies into the room as possible and not try to sell that I'm gonna have a relationship. Because if I sell that I'm gonna have a relationship and they don't get it, they get upset. But if I sell that I'm going to give them a good yoga practice and I'm also gonna have 50 people in the room for community, that could be great. You know, but if I go to something that's talking about, oh yeah, we have the best coaches, you have the best relationship with people, and then all of a sudden you do everything the exact same as everybody else, you know, that that to me just brings a red flag up where I think that people need to recognize the model they should be in. So essentially, if I'm looking at business models and fitness, you know, there's kind of two layers of it. One is are you differentiated or are you low cost? And the thing is, is if you don't build relationships, you have to ultimately become low cost. You have to because you're not differentiated. Now, technology can certainly pad that gap, but if everybody ultimately has that technology, which you know, we're talking to app developers, etc., right now, the cost to develop an app is dirt cheap now compared to what it was a couple of years ago. So even that technology becomes less of an attribute. So, unless you can pivot and create a new technology, which at the micro gym level is not happening, you have to differentiate yourself in a way that is built on the individual human being connection. So if you don't do that, you have to become a low-cost model. And a lot of people think that they are not low cost when they actually are. So, what are they doing? They're going into more expensive facilities, they're going into blah, blah, blah, blah, blah. They're putting up the variable cost structure for each client and they don't know how to profit. So they might be going up in revenue and going down in profit, which I can't tell you how many sets of books I look at and see that happening. We're scaling great. Cool, how's profit? Well, we haven't, we're we're making less. It's like, you know, how do you plan on stopping that? Because this is not like an internet company that's gonna all of a sudden have network effects and go from no profit to billions every year. This is not the game that we're playing. The game is how do I develop consistent cash flow on a monthly recurring basis? If you can't figure out how to do that and turn it into profit early, you've never proven the model and it's not gonna scale. You know, so it's just an interesting conversation. But to the second point, you know, you really have to look at um are you broad or niche? You know, so if I'm a broad market, right, that's Amazon, right? So, and I I truly mean that. Like, that's not just an example, right? That's broad. But look at fitness businesses right now, they're saying that they work with everybody. It's like get over yourself. No, you don't. You do not work with everybody, and that's perfectly okay. So somebody has to recognize who their perfect human beings. Is to walk foot in that gym. Because if they know that, they can market. Because look at how marketing's, I mean, this is your business, right? How is marketing being done? It's by the individual now. It's not through TV nearly as much, especially for micro gyms, right? That's not happening. It's through individual conversations through Facebook, through Twitter, through LinkedIn, through Google AdWords. If I don't have an experience that resonates with me individually, I do not know who you are or like who you are. That's just the way that people buy.

Yep. And I totally agree. You know, what we do, what we tell people all the time is we optimize and we amplify what the fitness pro is doing. That's our job, right? We um we are the marketing department, and as the fitness pro, you are the CEO. You need communication, you need to make the big decisions, we just amplify it. And I can't stress enough because I think I've talked about this probably on half the podcasts I do now. Know your ideal client. It's business 101. It's business 101. Well, can I stop you for a second, though? Of course.

It's not fitness business 101, because there isn't such a thing as fitness business 101. Okay. So, but but really, and and I I will say that with the the growth of CrossFit, unfortunately, the gym ownership standpoint wasn't part of their program, nor did they ever ask it to be, right? If if somebody opened a gym for a number of years, it was highly successful because CrossFit did such a great job building their brand. You know, but unfortunately, now with a lot of saturation, and the United States, at least from what I'm seeing, is not growing in affiliate ownership. Now these affiliates have to figure out how to separate themselves versus other affiliates. And so, how are they differentiating from the person who's a hundred yards down the street? That's the thing that's tough, right? And so CrossFit did a brilliant job of growing, and they have a really interesting and unique product, except for the fact that now everybody's doing CrossFit. So, how do you differentiate against that? That's difficult. And so, what are you seeing across the board? All these different challenges, all these different boot camps to bring clients in. It's like, is that actually your right client? And what's happening is a lot of these gyms are completely changing their entire um onboarding process because they don't know how to market, they don't know who they're going after.

It's it's an interesting thing too because I've seen, you know, I've owned a gym for nine years, so I've seen a lot. And one thing I don't know if this is unique to the world of CrossFit or not, but you know, a new gym would open up and they would go after another CrossFit gym's clients, right? Like what the f that's all over the place right now. It's it's crazy. And it's like, well, if that's and I, you know, if that's your business model that you're just gonna go after the same 500 CrossFitters in a region of, you know, let's say Santa Barbara, same hundred thousand people out of a hundred thousand, there's only uh six hundred CrossFitters. If that's the pool you're fighting for, uh then it's screwed, right? The whole thing's screwed. Now, if people are really understanding, like, okay, no, we're gonna we're gonna find our niche somewhere else. You know, when I uh at the point I sold the gym, it was very clear to me. I knew exactly who that person was. And they weren't a CrossFit competitor, right? They didn't care about their franti, right? They're more worried about you know what their next visit to the doctor would say, right? Yeah, and how they feel and their stress levels and all these things. And as soon as you start communicating that, and that's and this is why marketing is so important, but maybe people understand that maybe this is business one. As soon as you start talking to those people and letting go of the rest of the distraction, magical things happen.

Well, but it's it's really interesting though. Um in what other industry would it be looked at as bad practice to go after your competitors' clients?

That's a great question.

So it's it's interesting, right? So just because CrossFit's on the door, I'm absolutely in competition with somebody 400 yards down the street. And I think what we have to at least recognize is that that's true. So we don't have to like it or dislike it or anything. We just have to see that somebody's gonna have a choice and they're either gonna come to our gym or their gym. And so if I'm in finance, do you think that Goldman Sachs isn't going after JP Morgan's clients? No way, right? But but what is this bullshit in our heads that makes it sound like they're in the wrong for bringing in clients? And I know that's incredibly uncomfortable in the CrossFit community because everybody's supposed to be everybody's friend. Right. But that's not how it actually works. Because if I can't eat, I either shut down or I figure out how to find clients. And again, I'm not advocating for you to be a dick about it. I'm just saying that that's the reality. They're either coming to your gym or they're not.

Right.

So, how are you different and how are you going after clients? And so it's like people can be as upset as they want or they can eat. You know, so and I'm sure part of this comes from I was brought up in the school of you eat what you kill. I I heard that every week for five years at the hedge fund, you eat what you kill. And the thing is, is I want to explain that on a on a medium like this so that a gym owner is not surprised when it happens. You know, I'm not saying that they need to do it. I'm just saying that it's gonna happen. And so you better not be naive to think that somebody's gonna just claim that they don't want your clients, because that's not true.

Well, I think the first step when you face a challenge like that is what you're saying, is not being naive, accepting it, realizing it's there. Okay, so that's step one. Step two is doing something about it. So what's step two, Jim? What do you what do you do?

Well, I mean, I I look at it from a framework standpoint, right? Why would somebody actually want to go to my gym or somebody else's gym? Well, if I can understand what's underlying and what their buying persona, their buying cycle really is, I can set up a marketing platform as well as a service that talks to them in a way that makes sense to them. So let's say that somebody really needs, let's say that they just need accountability, right? Just the the universal idea, well, I just I don't feel accountable. I need somebody to help me feel accountable. Well, I can build an entire fulfillment sequence that hits them consistently with technology, with emails, with coaching talks, with conversations, with consultations, so that when I talk to somebody in a sales process, it's like, here's what you get, and here's how we help you, and here's how we support you, which makes total sense. I can then take that idea and turn it into my marketing and my advertising platform through video, through Facebook Live, through PDF, you know, lead magnet type content. And now all of a sudden I have an entire channel that speaks to that client who doesn't feel like they have proper accountability to their fitness. So take that example and multiply it by lose weight, get strong, get healthy, play with my kids, all those different things. But to your point, if they don't know who they're working with, they can't build any of that out. So if you want to defend against somebody coming after your clients, you have to serve them better so that nobody wants to leave your gym and you have to recruit or onboard or acquire clients more effectively through marketing and advertising. And the gym that thinks that they aren't gonna have to market and advertise is dead. They're literally dead in the next couple of years because you know, you want to know who's scarier than other CrossFit gyms close to you? Orange Theory. Because they spend what, 30 grand a month in Facebook ads. You know, so I love Orange Theories close to our gyms because we can prove a differentiated service because of the support that our clients get inside of our OPEX gyms. It's beautiful. So if you want to talk to an Orange Theory client who's not very happy, you talk about the support that they're gonna get from their individual coach, and they're like, oh my god, you know, and I don't even have to pay anything more than what I'm paying at Orange Theory. I mean, it makes complete sense for that avatar of a client. But yeah, go ahead.

So I was just gonna ask because it's it's a perfect segue. So how are you helping OPEX coaches, you know, CC people go through your training or you know, the licensees? How are you guys differentiating yourself from the market? Um, and maybe kind of reflect on some of the business lessons that other fitness professionals can learn from that.

Sure. I think up front, what we're trying to do very initially, and this is through the OPEX education CCP, we're trying to help coaches actually be professionals. So we're trying to pull them out of that, you know, one-day seminar that makes people think that they're a professional. And that's unfortunate, but that's where a lot of people are, and they really don't have the acumen to coach people effectively. So it's not just about writing a workout on a board, it has to be about relationships and support and longevity and understanding where a client is when they walk in the door. So I don't want to understate how important the knowledge or the education of coaching really is. And it's not just about the physical, it has to be about what happens outside of the gym, it has to be about the consultation, the life coaching that happens without the client even recognizing it. Right? Think about master coaches, right? They can say one thing, three words, and it changes somebody's entire life. So as you evolve as a coach, that knowledge is incredibly important. And we kind of, I guess, I guess we would say, you know, brand that as professional coaching. We don't think that most coaches are very professional. We want to help coaches become professional because what is that? That's a differentiated attribute inside of your facility. So that's number one, and we want anybody with OPEX associate coach next to them for that to mean something. So one of the funny things is our final project, as you would know, is very difficult. So to get through our course, not only is it six plus months of content and education and mentor calls with James Fitzgerald, etc. etc. etc. It's a final project that makes you actually prove that you can work with clients. And until that happens, how are we supposed to stamp our name on somebody? You know, so it we have a lot of people come in and some people don't finish the course. Well, that's good for us if they don't have OPEX next to their name because they've not actually proven that they can do this thing. And then on the more on the business side, when when our gyms come in, the first thing that they have to do is CCP education. We have to know that they can coach. So once that has been put in place and that's the foundation, now we move into what we call the business accelerator. And so what they have to do is six full months with James and I, where every single week they get content, videos, PDFs, all that. They have to post homeworks in private Facebook groups that I check. So think about that. I'm checking their homework every week. So I know exactly what these people are doing, thinking, executing on, not executing on. After six months, the way that they graduate the accelerator is they actually pitch us their business plan for the next 12, 24, and 36 months. And we crucify them for the couple weeks leading up to that so that they're prepared to, you know, to go forth. That's one of my favorite Cody Leffler and Emily Leffler and OPEX Upper Mainline, they use the term go forth and they just do it brilliantly. Um, but within that six months of education is a lot of frameworks and principles and implementation pieces around marketing, advertising, and sales. Because that is critical for these folks. Critical. And so as OPEX, the you know, our you know, our HQ brand, as we build out our brand, they're doing the same thing individually, but they have a baseline of education in order to do that. What are we doing outside of that? We're working with companies like yours to ensure that not only as are we as a headquarters, but also our licenses are putting better technology, better ad structures together to have consistency. So, what we don't want is to just have kind of a nuclear option where you can get 30 people into the facility, but they're really bad fits. So we want to have the option where we can put 15, 20 in consistently, and they're great clients with longevity and good relationships. And now all of a sudden, the fulfillment on the back side of all of our gyms takes those clients and then resurfaces their success stories, right, and their reviews as another way to build more consistency and momentum. You know, so that's kind of a surface answer, but we actually teach them how to do this. Um, and we don't claim to be a marketing agency, you know, so it's it's not as if this is our number one core competency, but through so many conversations and through a lot of gyms coming through the program, we now have a couple of very strong go-to methodologies and implementation plans that our gyms are using, and now we've got websites that are being built for them with technology on the backside to incorporate pieces of content that we're building out for them. You know, so there's there's just a lot of things that are kind of moving in the same time, but if they understand the principles of it, and if they have support from us and support from technology or other companies like you guys, that's where it starts to make consistent sense for them on the marketing side and the differentiation side.

Well, I mean, as a business owner, that there just is a lot of stuff going on, right? I mean, there's an infinite amount of distraction that can take place. And uh, you know, when you when you're coaching these these people to be business owners or coaches, uh what metrics do you have them focus on? What are the the key metrics that you want them to look at and just really hone in on those because you know if they focus on that, then success will follow.

Yeah, from um from a fulfillment standpoint, um the number one metric that they must track is total client retention by month and total coach, I'm I should say by coach retention by month. The sheer awareness of by coach changes everything because now all of a sudden each coach is accountable to making sure that they are retaining their clients. But remember, in our model, each coach has a client and that is their client. So it's not like this coach is accountable to somebody they don't work with. So if they have these clients and they're coaching these clients and they're building relationships, and that client walks out the door, something changed. So we have specific metrics for our gyms that we want them to hit on a monthly basis, but we also want them to build procedure behind it that says if I lose a client, what do I do? You know, exit, interview, all those other pieces so that I can recognize what part of the process either broke down or what we can do to solidify people's longevity in the gym for a longer period of time. So if you count that plus a lifetime value of a client, that really takes all the numbers that you need and puts them into essentially one or two metrics that can tell you everything about your gym because that's going to get to revenue, that's gonna get to everything else. On the acquisition side, request to consult is the number. So in our gyms, we go through a sales process. So that sales process is achieved, if you will, if somebody opts in or requests a consult. That's the key. The key or why it's the key is a couple of reasons. One, it's very, very easy to track. So you know this, Eric, and you know, we're talking about some of our social metrics and everything that we want to track and some more complicated stuff. That's not where these gyms need to start. They might want to hire somebody to track that stuff, but there's no way that these gyms are going to be able to track you know pixels and UTMs and all that different stuff out of the gates. If they track requests to consults, what that tells them is are my aggregate efforts working to acquire clients? If the answer is yes, that number's trending higher. If the answer is no, it's either flat or actually declining. So those two, in terms of request to consults and retention, those baseline are the two that they need. To go one layer farther, that's the lifetime value, that's the revenue piece. And now we're talking about opt-ins or conversations had on either social or in-person conversations with people. So we view it kind of as this bow tie, right? Where it's like to the, I'm, I guess that might look left, but to my right is the fulfillment of the service. That's where you have program design, nutrition, ongoing consultations, retention. In the middle, that's where you have your initial consult and your assessment. Okay, so if I can track that as one, if I can track the actual fulfillment as one, and then to my left, that's where I have advertising, marketing, and sales. So we look at it as a very specific, we call it the bow tie, um, and we look at it as such. As people get more um understanding of the initial metrics, that's where we start to build out the picture that they look at. But if we can't get them to get retention and request the consults, we're not going out farther. Um, and that's just reality. And for some people who don't sit as far on the business end, if they can track those two things, that gives them a shitload of insight into what's working and what's not. Because if I spend a month doing a huge Facebook campaign and my request to consults are this, how successful was that campaign? I don't care how many views, clicks, whatever else, if I get no request to consult, it's currently unproductive. Doesn't mean that in a month you might not get some request to consult, but you have to set up the strategy to say in two months this strategy should lead to X number of requests to consults. And the only reason I'm not saying close clients, Eric, is because our close rate is intensely high once we get them into a consult. So that's just our um I I guess that whether it's lucky or or good process, that's that's how ours works. So I want to see request to consult.

Well, yeah, I think it's a whole nother problem. If you're not converting consultations, that's a whole different conversation, right? Definitely. Uh so I'm gonna give you avatar. Let's say I'm I'm flow, the fitness pro, right? I've got a small studio. Um, you know, I I work, I'm a kettlebell specialist. I've I've been open for a few years. Um, I have a couple loyal clients, but the referral network isn't really quite kicking in, and I don't have budget to spend on marketing or a service like ours, or you know, even to put a whole lot into Facebook. What do you what do you tell this person to focus on? What's the first thing that you would you would coach them through?

The the first thing I would do is actually not tell them anything. I'd ask them a question. And that question would be how many conversations are you having face to face outside of your gym with people who you didn't talk to last month? And almost always, Eric, the answer is crickets. Because they're not building relationships. So it's very difficult for many business owners to actually think that they have enough time to go build relationships. But the fastest pathway to clients in a localized market is to have a better network in person. We know that for sure based on the gyms that we work with. If I have good friendships and relationships in four or five, whether it be local businesses or a chamber of commerce, whatever you want to call it. And I don't just mean bullshit, you show up every once in a while. I mean like relationships. You do that, and all of a sudden referrals magically start to come in. You know, so I always ask the question, what are you doing in person? Because if you don't have budget, you had better be making conversations and friendships with people in your neighborhood, in your town. And when you do that, all of a sudden people just magically start to know who you are, right? Just the sheer fact if I walk into a bike shop and I'm wearing an OPEX shirt, five or six people see OPEX. They don't know what it is. But if I walk in there four or five more times and those people see it again, now they start to ask the question. So, you know, you and I both know the statistic better than most. How many conversations does it take to actually get somebody to be prepared to buy? It's now 16. So if you think that you're gonna post on social media once and get a client, you're out of your mind. You're out of your mind. So you have to build pathways, channels, whatever marketing term you want, where you can have multiple or numerous conversations with people over and over again so that they get to understand who you are, what you believe in, and if your beliefs align with theirs. We're no longer in this world where it feels really good to talk to people who you don't like. Just look at the political landscape. That's not where we are. Social media has put us into silos based on our likes and our actions. So if I'm going to certain places over and over on social media, I'm going to get those ads. That's just the way that the algorithm works now. So you have to put yourself Into like-minded places who have clients who are your perfect ideal client. And you have to build relationships with those business owners, with those group leaders, with those influencers. And when you do that, that's when you can start having a conversation about what you do. But until you know them, it doesn't make any sense. Like I wouldn't walk into a bike shop and just say, hey, you should give me clients, because the bike store would be like, Why the fuck would I give you clients? They don't know who you are, they don't know what you you know what you do. But if I build rapport, no different than sales, if I build rapport and build credibility, now all of a sudden that person is more interested in learning about what I do. And that's a more authentic conversation, which by the way, welcome to the new wave of content marketing. That's what it is. You can't post one blog and expect the world to show up. And so we have a lot of honest conversations with our gyms. It's like you want people to come in, conversations over and over and over and over and over again. Think about how easy it would be for you to sell somebody, Eric, if you were in person face to face and you had 20 minutes. Think about how difficult it would be if you had one Facebook message. So I'm all for organic social media. I'm all for paid social media. I'm just not for it if you're not building relationships along with it.

Yeah. So I 100% agree with everything you're saying. And I I I love the concept of hustle, right? When I first opened my gym, and this was a long time ago, CrossFit actually just brought people in. If you put the name on the door, it did, right? But I didn't know a single person in Santa Barbara. So my my business partner and I, and this was an anecdotal, we we had a thing. We're like, okay, at the end of the week, we're gonna give each other 20 bucks if we hadn't talked to five people and gotten five new business cards, right? Nothing that beats that. And for people who are listening, like, well, that sounds so uncomfortable. It doesn't have to be. And and somebody, you guys are on the two-brained business podcast with Chris Cooper. He always he has a great concept for it. And I don't know if it's new or if it's one the way he framed it, but it's called help first. Like you just know, you're just going to help somebody, right? So if you want to go to a bike shop, you want to build a relationship, you're like, hey, you know, I like to bring uh you in so you can, you know, trying to think of something like uh I want you to be educate our people on how to ride bikes. It's oversimplistic, but you get the point. You go to them because you want to help them, and it's not that hard. So if you if you take away that fear of like, uh, I'm just gonna go up and I'm gonna give a card to somebody and I'm so nervous, right? Uh no, you just gotta get out there, and and the fact of the matter is, is once you do one, it's not that bad.

No, oh, it's amazing. I mean, uh, two things really come to mind about that. You know, we're we're in the fitness business, and and everybody has this concept of adaptation, right? You do something and it's challenging, and magically your body gets better. What do people think that sales and marketing are? You think that you're just gonna be the best salesperson or marketer the first time you do it? It's like they don't comprehend that there might be a progression to understanding how to do that more effectively, which is why you know companies can be very beneficial if it's the right fit. Um, the second thing is that I think it's it's really an interesting concept to think, nope, not nobody, I shouldn't say that. Many people don't actually think about adding value first. They go in with that mindset, like you or like Chris are saying, of I'm going to extract value from this interaction. And that just doesn't work. I can't tell you. I mean, how many people try to get to you? So many people try to get to me with phone calls, with emails, with whatever. And every once in a while, if somebody writes something that looks intriguing enough, I'll ask a question to see how serious they are because five out of six people either won't respond back or it'll take them a week to respond back. It's like gone, you know. And so if people are wondering how this um weeding out process works to become the player of gyms in your area, it has to be consistent and you have to actually add value to the conversations that you have. Because if you can't respond quickly, if you don't have good conversations, if they don't understand what value they're getting. And by the way, value could be entertainment, it could be conversation. So there's no singular definition of value, but if you don't give them something that they actually enjoy or value, why would they actually send you clients? You know, and that's why I'm so adamant about you can't just show up to a networking group. That's bullshit. That's not gonna get you anywhere. If you get ingrained into a networking organization and you produce and you um provide value to them, sure, you're gonna start to get some people who come knocking on your door. But I think a lot of people think that you can still open your doors and have clients flow in. And maybe if you're a nationally franchised, highly brandable business, possibly. But guess what? You also paid $100K for the privilege of having those clients walk in the door. So if you're a local micro gym, you have to plan out and execute on how you're gonna go have these conversations digitally and in person.

Yeah. And as the fitness pro too, I you know, I'm and I'm speaking to you people, is you have a ton of value. It's it's as simple as going to a local high school team and saying, hey, you know, let me do a free nutrition seminar for you. It's that easy, you know, and then go ask how and that feels good, right? It feels good. So go out and do it. Um, Jim, I know I'm I'm running short on time with you. So give me um how do people get a hold of you? How do people get involved with what you're doing at OPAX? Uh, give us that whole bit of information.

Yeah, probably the best way to do it is just to go to our website because we've got a couple of different uh offerings, right? Essentially the the three businesses that we have. We have remote coaching for athletes in the sport of fitness, we've got CCP education, which is both digital and in-person education courses for coaches, and then we also have the gym licensing program. And I want to say it now is that you have to go through coaching education before you get to licensing. So make sure that you check that out. But our website is just opexfit.com. Um, and that's the best place to get in touch with people. And if you want to email me, it's just gym at opexfit.com. And here's the actual challenge. I'll bet you not that many people email me. I always find it fascinating. That's why I'm willing to give an email out, is because generally the people who take the time to do it are worth having a conversation with.

Yeah, and that's really interesting. And just to sign up before we go, is everyone I actually I'm the one who takes people up on that. Like Dan John did it, so I email him right away. Now I really should. Dan John James Fitzcherell does it. All these people who do it, I write it down, I email them the next day. You know, they almost always respond. So um, yeah, take them up on it, people. If if uh do it. In fact, let's see if we can get them like 50 in a day.

I'm up for it, right? Because value for value, right? Who knows? Maybe you'll get into our coaching program and then we can work together on licensing.

Yeah, awesome. Well, very smart guy. Thank you, Jim. I appreciate it. And uh I know we'll be talking very soon anyway. So have a great day.

Yeah, thanks, Eric. I appreciate it. It's always good chatting.

Thank you for listening to this episode of the Future of Fitness podcast and webinar series. Uh, we're working really hard here to keep great content coming out, and we like to express our gratitude by offering you a free seven-day marketing crash course. So here's how you can claim it. If you go to fitnessmarketingalliance.com forward slash free gift f R E E G I F T, and you enter the promo code FitMARK F-I-T-M-A-R-K, you can claim it that way. The other way is you can text us. So you can text the phone number 805-619-5550, and you text the word Fitmark F-I-T-M-A-R-K. So thank you. Keep listening, go claim that offer. It's a ton of value. And if you ever want to get a hold of me, or if you have suggestions for guests, topics, or anything else, or if you just want to ask me questions, uh, I always respond. You can reach me at Eric E R I C at Fitness Marketing Alliance.com and keep listening. We have a lot more coming down the pipe, and uh we'll make sure that we're keeping the value great for you guys. And farewell till next time.