The Future of Digital Fitness Content - Mike Hansen

Level five mentors to helping entrepreneurs to the highest levels of free-finding kind of money related to healthcare possible certified course creation. Speaking entrepreneurs create accredited online certifications that are not only lucrative, but highly skilled go to level five mentors.com for certified course creation.com and learn more. I'm your host, Eric Mountain. And once again, welcome to the feature that we're live like. Welcome to the show, my friend. Thank you. Thanks for having me. Yeah, I'm excited to have you here. I'd like to give a quick shout out to Anne-Marie Barber for getting us connected. So, Ann-Marie, if you're listening, thanks for making the connection. I'm excited to have you, man. I think you and I have a lot to talk about as far as what the future of the industry looks like and how technology is potentially grabbing the reins right now. And I should note that today's recording date is June 5th of 2020. So we're kind of in this very odd time where the pandemic is not really slowing down, although it seems to be not the focal point of attention right now. There is a lot of protesting, riots, all kinds of things going on across the country right now in the United States. So it's a very odd time. And as you note that at some point there is still the killer hornets out there that we haven't been, we haven't been discussing. So Mike, thank you for coming on. As always, if you if you don't mind, maybe give us a little of your background of, you know, maybe specific to the fitness industry of how you got to where you are now.

Yeah, sure. Thanks for having me on, Eric. A little bit of background on myself is I got in this industry in the later 90s, 24 Hour Fitness pretty much held the majority of club operational roles there. And uh one day I decided I didn't want to wear sweatpants the rest of my life. That's kind of a funny part of my story, and I actually went into the Wall Street side of the equation with healthcare specific hedge funds, my educations and economics and finance. It was a good move because I realized that my passion was fitness that I had left it. And so when I came back to the industry, I came back to the industry and I put my entrepreneurial hat on and said, I'm gonna solve what I thought was to be the biggest problem was you know, fitness is kind of boring to a lot of people. So I was like, we're on the mission to make fitness fun. In doing that, we started a gaming company specific to using gaming and movement. Free Nintendo, we got to ride that wave, Top 100 Burke by Entrepreneur Magazine, largest commercial provider. And that kind of positioned me in this whole media tech space within fitness. And I was able to parlay that into becoming known as a serious games expert. That's kind of what the market said it was anyway. So I got to do stuff with like Medtronic Merv and some of the large health insurance companies. And as I was doing that, I kind of realized there was this whole opportunity around technology and fitness. And keep in mind, this is like 2010-ish, roughly in there. And in doing that, I said, I want to own that bridge. I don't want to own the concept of the bridge. I want to walk people back and forth across that bridge. So I got really deep into tech and I got really deep into fitness, and I started to do that. And I did that in sort of a view of like strategy and innovation, helping companies ultimately innovate and think about their strategies relevant to that. And that's why I got to work on really cool things from like one of some of those stuff. So concepted one of the first smart gym designs. We got to do wearable work, we got to build clubs, and then ultimately speeding up to where we are today, I got to work on a lot of media projects. And one of those media projects was we were retained to work on streaming strategy for a very large software company in this space, and ultimately identified this sort of format shift that was taking place within fitness, and that was really relevant to this digital streaming stuff that we're in today. And that's ultimately what led to the creation of endorphins.

Right on. You know, I reflect back. So in 2010, I was really kind of getting going in the fitness industry. I was building my first gym, and technology was not even on my radar yet. Obviously, the iPhone came out in 2007, 2008. So things were, you know, as far as technology, or at least handhelds and things like that, were really starting to get going. Can I ask you some questions about smart gym? So, first of all, how do you define a smart gym? And then I guess the secondary question we should get into is like back then in that time frame you were talking about 2010, 2011, what did a smart gym look like back then compared to what it is now?

Yeah, so I think it was one of those things around just the connectivity side of can we connect a facility? And when I go into a facility, the premise was this. I walk into a facility, they know I check in, but they have no idea what I do, and they probably didn't even know when I left. And I was like, we can connect better with people. And it's already happening with devices in other areas. So I was like, what if we networked a facility that actually knew who I was and can provide that information back? And you can do that through Wi-Fi and cameras and all the different things that were still available at that point in time, even maybe a little bit more expensive. And keep in mind, I had just had worked on the camera that actually ultimately went into the Microsoft Connect. So with gesture tracking and facial rec, and I already knew some of these things. It was just early days. And so ultimately we could understand where consumers go in there. We could ultimately try to send them the right message at the right time. The issue back at that time, and the reason why we probably didn't see that move forward, was in order to do that, you needed to use the application as the identifier with the member. And a lot of members didn't look at a fitness app as something that assisted them in their journey inside the facility. It was more information, just like a website. And so I was like, are we going to format shift the consumer sort of mindset to go and use it that way? I said, maybe not. And so that was one of those things where it was ultimately a timing factor that needed to come into play for that to work. And I think now we're we're seeing that apps are obviously much more viewed as an assistance tool versus an information tool.

So how do you see like in the world of smart gyms, who do you think is doing it really well right now?

Uh, good question. I guess I haven't even seen one fully executed, honestly. If you think about what it ultimately could do, what I see is I see a lot of vendors that potentially solve part of that niche. And I still think it's yet to be fully brought together. And I think about the smart home, right? And so that was one of the things is when I looked at it, I said, what about smart home, smart gyms, things of that nature? And there's still yet nobody who's serving in the position of being the hub within that. Because there's a lot of different communication protocols that happen between devices. I can have a smart yoga mat, I can have cameras in there for facial recognition, I have my wearable, I have my phone. They all work on different protocols. And you actually you actually need a hub. No different than like what I think it was smart things that was acquired by Samsung for the home that integrated and created that seamless experience for the consumer and made it simple. That's just not there yet in our industry.

Yeah, interesting. And I would imagine that, you know, it seems like the smart gym is actually moving into the smart gym inside of a smart home. Exactly. Exactly. Yeah.

And I I test that myself. So I actually set up my office to be a smart office. And I was like, I'm gonna set up my office and tell basically have Alexa control most everything for me, and I'm gonna see how that translates to the other parts of the home. Like, do I walk in the living room and try to tell my TV to turn on in there? Or does it stay confined here? Does that first integration of going smart force me to go smart in other areas? So a lot of times I'll test these concepts on myself.

Yeah, I like testing technology on myself. So you've brought up in recent conversations that you and I have had and alluded to it here in this uh this conversation so far about the kind of hub and the spoke. And maybe if you can help explain it to me, maybe in the context of like a smart home. Like I would imagine the hub would be like an Alexa or a smart fridge or something like that, some central piece of AI, right? Explain that concept to me.

Yeah, I think that's right from a home perspective. I think what I was speaking with you about with regards to the club side of the equation is that there's a multitude of places that somebody can work out. And the consumer ultimately is gonna have an application that's potentially gonna control that. If I want to work out at a hotel today, if I want to work out at a gym, if I want to work out at home, whatever it may be. That's so that central source most likely is the phone. I always call it the power of the pocket, right? The power of the pocket in the phone is such a driving force. And so that could be the hub. But the question is, what's the brand going to be when I enter that application? And that becomes the hub, and everything else becomes a spoke that maybe I give them access into those things, but I still provide that value, I still provide that assistance because I think we're gonna see this personalized anytime, anywhere business model like fully roll out, and you either will be the hub for your member or you'll become a spoke for somebody else's. Interesting.

So from a big picture perspective, Mike, I mean, right now things are changing really fast in the fitness industry. And I think anybody who's had you know at least a little bit of their their eyes focused forward has seen some sort of disruptive event happening within the fitness industry. I mean, I, you know, I was a gym owner for a long time. The boutique gym model is fragile, to say the least. And, you know, a lot of it was people are saying, hey, we have we're relying on technology because we use hard ray monitors. Well, that's not really tech, right? It's still very human-driven and still based on models that are, you know, I would say getting quickly antiquated. Looking at what we've seen over the past 90 days, how much did you expect to see and how much has been a surprise for you?

Yep. So we've always said that there was this format shift taking place, and format shifts take place in every industry, every industry, and it's driven by a consumer, right? And so the businesses have to adapt because the consumer drives that shift. And just as an example, uh smart cars from electric car, or from electric car to smart cars, you know, the music industry went through a format shift from the CD to streaming. So the roadmaps are typically there's a lot of history to look at there. So we knew this was coming up. Obviously, the acceleration, I think the last record I saw what somebody stated 74%. Those clubs are now have a digital or some sort of streaming offering when previous to this, like it was well under 10% of people that had that. And then even when you put a paywall, it was like under 5%. So think about that growth that those numbers are right, was like that fast. I would have never imagined that. Like, not in a wildest dreams, right? It's almost like the perfect storm to force that sort of thing. The other side of the equation is we did a lot of research actually on live versus the video on demand, and live never was used this much. And live was the only option, hence why it got used this much. And Zoom, we knew bi-directional communication was the future. We knew that there was this sort of like barbell economy, even within content, that was going to move to this interactive VR AR market. But at the pace it happened to be was obviously way fast. And I would say the Zoom thing was never accounted for even in the previous research, even. But we get it. We completely understood the attributes and the mechanics of that. But those are things I would say that were surprising.

So let's get into what you're doing now. So you are a managing partner in Endorphins. What is Endorphins? What brought it about?

Yeah. So Endorphins is a full service fitness streaming agency. So we're the first fully dedicated end-to-end integrated agency dedicated to taking businesses online within fitness and streaming. And what brought about this was we were working on a big project last year and we identified a pretty big gap within service. And when I mean service, what I mean is like if I want to go ahead and figure out how to do it, I hire this person. If I need production, I get a production company, publishing, digital marketing, licensing. It's just, it's a very complex market with a lot of things you have to do. And there was nobody serving in the horizontal position across all those functions. So we said we need to get into this business to help navigate people. Otherwise, it's going to be such a rocky road and things of that nature to get people into the market that they may not get there or they may get there and they may get in the wrongs. That's ultimately where this came from. And it was kind of a service company to help companies launch. And so it was kind of the perfect timing with everything that took place with COVID for us.

Yeah, that's interesting. So the way I look at it, let me know if I'm wrong, is that you know, maybe I'm a talented fitness professional. I'm sure there's a couple different avatars that you guys can work with. But if I'm uh someone who has a good following, uh, I've been doing it for a while, I'm an expert of what I do, and now I want to take my brand, my services completely digital. Where do I start? That's where you guys come in.

Yep, that's where we start. And then we ultimately hope that we don't finish and we're just a partner and help you operate and improve that business. We always say from the first time you have the idea, we can be there with you to the point that you collect the dollar, we can be there because we focus on what you do on top of all these platforms versus being the platform.

Yeah, I like it. So give me an example. Give me an example, either theoretical or something you guys have worked on of like who this type of person or company could be, what are some of the steps that you've taken them through, just so our listeners can understand like what the actual processes could look like.

Yeah, so I'll take you through uh entire kind of like process of how this would work. And it's it's a two-headed dragon. So we're gonna start with the left head of the dragon, right? And the left head is really around your strategy. So a lot of people come to us, what tools, what cameras, like the traditional thing you'd think about, they're like, I don't know what I'm gonna use. And we say, well, let's just pause for a second. Let's talk what's your content strategy, because the content strategy dictates those tools and the platforms that you use. So we'll engage with somebody who actually wants to say, Yeah, that's right. Like, am I a brand extension or am I trying to just connect to more people? Like there's a couple of strategic through lenses we can look at. And once we anchor in that, then we can very quickly take somebody through their procurement process to figure out the platforms and tools. Because usually there's only two to three options once you actually define what that strategy is. And once we've gotten to that point, we can very quickly get somebody up and into the market. And it depends on if they're trying to do a custom development or if they're trying to do like an solution where it's just a white label. And once we've gotten to that point, we will do everything from uploading your content into the site and doing the metadata and the tile management and the publishing of that, as well as help you figure out your social channel development, your web channel development, your email channel development. And what we do is we look and say, oh, you got a gap here. You need 2,000 more people to make this business achieve the million dollar run rate you want or whatever it is. And then we say, here's the PPC spend you need to do, and we will execute our creative team on top of that to actually execute that PPC with a, you know, ideally an ROI of at least three plus. And then we actually extend into licensing too, which is a which is another area that people who really embrace this industry understand that that's a way to gain additional audience and gain a little bit of monetary uh value to. So, like I said, it's truly end-to-end because what happens is as you operate this, you're going to create content, whether it's live or video on demand or whatever it may be, you're gonna market it. That content is most likely 80% of it's gonna be consumed in the first two to three weeks. So, guess what? I got to do it again and again and again and again and again. It's just an ongoing flywheel. And so we we saw that as a great opportunity to provide that value.

Do you think as you move forward, do you what do you project? Do you think it's gonna be most of your clients are gonna be individual fitness professionals with maybe some branding already established? Do you think it's gonna be health clubs? Do you think it's gonna be boutiques? Do you think it's gonna be uh you know, outside industry people coming into the industry? What where do you think it's it's gonna hit hard?

Yeah, so our mission is to connect fitness creators to consumers, and I've even internally joked and said, well, fitness creators to the world. And so our primary market is fitness creators. And when you think about what a fitness creator is, sometimes they own a boutique, sometimes they own a club, sometimes they're an instructor, but it's the person that's creating the workout. When we look at our markets, we think that the primary market for a great opportunity actually sits around the instructor and the boutique because boutiques already are creating content for the physical world. Usually it's yoga, pilates, hit, right? It translates really well into digital. We also do help health clubs because they obviously need that help as it relates to figuring out what they're going to do on the content side. And this actually does also drip into the equipment sides. We've had multiple conversations on the connected fitness side, similar in nature to what you might think of the category being the Peloton and the mirrors and the echelons and the tonals and things of that nature. That's also another opportunity. We actually cross over any market that serves content, which also means we've had many conversations and done some work in actually digital native apps that are fitness focused. Awesome. So we have a little bit of a more broad view on that, which also is a value because as you get into content, the question comes up, and it has come up multiple times, and we've worked on this, which is do I extend in the connected fitness? Do I extend into some of these other markets? Which we think the existing people that are out in the market that had good products that grew 500, 700, 800% subscriber growth over the last months are considering things that you might not even think, which is like, do I execute a varis project? Do I execute like Peloton? Do I do some of those things? So I think we're gonna see some change. And when you think about that landscape change, that's pretty interesting change for the market if you had a club, a digital offering and the equipment offering, which obviously Equinox is showing that right now.

Yeah. What was that that you said earlier? Was it a var a varis project? Is that what you said? That's Equinox's uh name. Oh, got it. Okay, got it, got it, got it. I'd like to expand a little bit too, Mike, on what you I believe referred to as like the decentralization of fitness and the hub and spoke model, what's going on. Can you expand on what your your thoughts are on that and what that's looking like and maybe give some more historical perspective on it too?

Yeah, for sure. So I've had this view for the longest time that, you know, as a gym owner and gym operator, we need to break down the walls and not be a location provider, but be a service model. And a service model in today's environment is probably 24-7, right? So I think that's one component of it. And when I think about the consumer, I think about the consumer and think basically there's three options that go through their mind when it comes to the workout. And I call the workout the commerce of fitness. It's the common transaction, whether it's in the hotel or whether it's at home or whether it's at the gym or the studio, paid or not paid. When I'm getting ready to work out, I have three options. I can stay at home and work out. I can go outside and do something, run, bike, climb, whatever, or I can go to a commercial facility whether that's paid or not. So what we've done is we've actually tried to extrapolate and say, let's look at the workouts across those three venues. We already know the check-ins are around what 6.6-ish billion in the US with clubs. Um, we quantified last year over 10 billion streams. We don't know the destination of where those streams landed, but we know that that obviously is most likely a high percentage where we're outside the club. And then we know what percent of people outside run, bike, whatever that part, that those outdoor participation rates are there. And so, in order to support your member as a service company, you have to have the ability to connect with them in those environments. And that may mean a wearable, that may mean streaming, that may mean a lot of different things, but then that means in this hub and spoke model, you need to be able to provide value back to the member with that wearable when they use it. Same thing with streaming and so on and so forth. And so this basically means in order to execute a strategy like that, you're gonna have to embrace technology. And I'm still a big believer in the power of the pocket and that mobile device. And so, what does your application look like today? And does that application provide that value?

Yeah, man, it's such a fascinating time to be in the fitness industry. It really is. There's many times, I'm a personal anecdote. There's been many times over the last two, three years where I've considered just kind of uh just leaving the industry, you know, I'm not doing as much podcasting, not working and coaching and consulting as much as I I do within the industry. But I'm I'm happy I stuck around. Not and I don't say that in a way I'm very empathetic and sympathetic of the suffering of like the small gym owners and health clubs and trainers who are trying to figure it out. But now, as a as consumer needs are shifting so quickly, almost overnight, it's a really interesting time to help people reposition and move into this new thing, whatever it may be, right? I would imagine your excitement levels for the possibilities have increased quite a bit over the last few months.

Yeah, for sure. You know, I've had a lot of dreams and I've tried to take pride in looking around the corner before others do and things of that nature. You know, the thing that I've applied to this that's helped me get a little bit better with the timing of these has been around this whole theory of jobs to be done, if you're familiar with that, which in essence is like defining the consumer why, the causality versus the who, what was the decision point right before they made that purchase, what did they fire in order to consume that? And really, once you start to understand the consumer jobs, you actually can better organize product and you can better organize messaging and organize the business around those opportunities. And when we start to apply that to the consumer today, I think that shows that the change is very rapid and it shows that things are changing. Like we we've done that for streaming as an example, and we identified at the at the macro level, because micros a lot of times have to do with brands too, is that you know, consumers were already consuming this digital stuff because they weren't within proximity. So access, right? The schedule didn't align with my schedule, so I had to do it because I couldn't make six o'clock because I worked till six. It was too expensive, but I liked the idea and I liked the brand, so I tried it online first. I have intimidation, this gym intimidation thing, like is a real thing, and I can see inside the facility, I can try it, and I feel a lot more comfortable, which then allows And to potentially pull in. And so when you start to think about those things and go, I'm going to solve that job for my customer or my prospect, it makes it much easier to create product.

Mike, what do you think the gym model is going to look like in a year from now, from health clubs down to boutiques? Who do you think is going to thrive?

Yeah, I think it's going to be the ones who embrace a hybrid model. And I think that's ones that can service customer the way that consumers are serviced today. You know, a membership gives you access into a building, right? But if we embrace this whole concept of like, I'm not a location provider, I'm a service provider. Well, when you provide service 24-7 in other industries, we might call that SaaS, right? And if you had a SaaS product, it provides you service when you want the service, right? And so with that sort of thinking, you're going to probably have to transform your business into a hybrid model. It's the 24-7 service model relevant to whatever job it is you anchor in. And if it's a workout, it's a workout. If it's fitness, it's fitness. Granted, I know there's a community side to our industry, and I fully support that. I go to the gym all the time. Um, but you have community and convenience in a battle, and we live in a convenient society, and convenience is getting more community oriented. So you've got to embrace that.

Yeah, that's a great point. It's a great way to put it. You know, so Mike, I would imagine as someone who's, like you said, you know, always kind of looking around the corner. As I say, I I like to skate to where the puck is going. Different analogy, same point. That that always comes with some risk, right? Because you're you're you may be wrong at times. I I guess I like to hear maybe some things just anecdotally that maybe you didn't get right and that uh was a challenge for you as you're navigating these waters. Any kind of funny anecdotes of things that maybe you thought were gonna hit but didn't for some reason?

Sure. I put cameras inside group fitness rooms in 2014, 2015.

Okay.

It wasn't wrong, it was the wrong timing because I had to condition the market, right? Costs were a little bit higher too at the time, but that's that that was irrelevant actually. But nowadays, if you think about it, everybody's putting cameras in. I have can't I have calls every day about putting cameras inside group fitness rooms. So there is the timing factor, and I think the only way to really get better at the timing factor, at least for me, has been to root myself in the job side of the equation around the consumer. The consumer is going to drive the B2B side, even if I'm a B2B company. And so we actively pretty much every month do consumer interviews, and those consumer interviews really do help. But yeah, I I definitely had the timing off on that one.

That's funny. So what the goal of that was to be able to stream the classes to other people who weren't there? What what was the intention?

Yeah, so you know, back in the time you had the quote unquote the fitness on request back then, now well be fitness on demand. You had these guys that were piping content into the group fitness rooms, right? And I had good I had just got done doing a bunch of server-side streaming around video games, like live sort of like doing video games from real time back in that time frame. So I looked and I was like, it's kind of like me taking my DVDs. That makes I understand the value, prop, fill the space, whatever, but look at the amount of content that's taking place in your studios already. And I'm like, Blue Ocean Strategy, and like reduce your highest cost factor creating content. I was like, I'll capture it and I'll take it out. I'm like, I will create a broadcast network specifically for gyms to be broadcasting their content out to the consumer and touching them where they're actually at. I said the market's way bigger, and I was like, we can actually build the biggest content catalog. I can give that content catalog to the broadcasters, they'll put it on TV. I talked to the plumber president exercise TV. I was like going through this whole thing. Like, great business idea, great business model, but obviously, you know, it takes a lot to move everybody into that.

Yeah, that is a great idea. It's fascinating how fast people are catching on to something that seems like it has been obvious for so long as like, hey, you're gonna need a lot of content in this new world. Like a lot. Yeah. How are you seeing the gaming industry and the fitness industry merging? Like, where are they overlapping right now? Where is there any other areas or projections that you have with that kind of merging?

Yeah. So I mean we we've looked at the VR and the AR and the holographics, which is that gaming. I mean, technically gaming is when you apply game theory, right? So gamification kind of gaming. I think what gaming potentially brings to this world, and we've we've toyed with the idea, and I'll put it out there, like need to keep it to myself. Would somebody work out to a video game where I actually don't have to put somebody in there and like they stick to their avatar? I think you see a little bit of that. Whether that sticks or not, I'm not 100% sure yet. I think what gaming gives us, and ultimately the view lines that I would kind of look at is like it's interactive entertainment, which in essence is somewhat distraction. It also can create these really cool environments for people. The other side of the equation is like you naturally have a younger society that gaming is probably their social media, it's kind of the way they've positioned it. So, like, yeah, my son's playing Fortnite, but Fortnite is like Facebook for him. And like that's how you need to think about that. So if you're currently streaming into Instagram and Facebook because you're trying to meet your consumer, guess what? You need to actually now figure out TikTok or figure out Fortnite, right? Because those are their social platforms. So their social platforms embrace games, our social platforms necessarily don't. Interesting.

Yeah, I've had um good friend of mine, uh Taylor Johnson. He's one of the world's leading minds when it comes to esports performance coaching. And, you know, one of the things that I find interesting, and I I don't have kids, I have nieces and nephews, so I'm not around it every day, but I do see when I get to spend time with them, which hasn't been a whole lot over the last four months, it's fascinating to me how different things are. And I think, you know, a lot of people are out there and they're they're resisting gaming, right? They're resisting the esports, they're resisting all these things because, you know, they see them as like, well, you know, it's it's sedentary, it's it's sucking my kids away. And then, you know, all these things, right, that you hear. But when you look at it, it's like it's not going anywhere. This is where the kids are. This is where the youth is. How do we meet them where they're at and give them a healthier option moving forward? I think that's the question, right? When it comes to that.

Yeah. And, you know, having a background, having introduced gaming to the space and kind of pioneering that that introduction into the market here, you know, it was a it was an uphill battle. But, you know, one of the things that I always used to say to people is if you're the best teacher in the world and your kids sleeping at the desk, it doesn't matter. So you gotta meet somebody where they're at. You have to engage them first for them to hear you. Otherwise, it doesn't matter what you have to say. They're not gonna hear you. And that kind of goes back to just everything and kind of even back to this hub and smoke side of the equation, which is just meet them where they're at. And then it's your job to pull them through to where you want them to be, but it has to be engaging. And if you bring this back to content today, which I think is an interesting thing to talk about here, is that content is consumed because of two things it's funny or it's educational, right? Yes, yes, the stuff in between is kind of just lost to noise, and so gaming is fun. You can't you can't throw it to the side.

Yeah, it's such a complex thing, put simply. I love it. Mike, there's another topic that you and I had talked to a few weeks ago when we first got connected, and it was interesting. You had mentioned your vision for like a record label model. Can you expand on that?

Yeah, so I think this digital market opportunity is is probably not structured right. And what I mean by that is that most people, you know, create content and they put it out there, and it's sometimes it's even gated, right? It's just specific for them. Traditional media, you put content out, it goes to multiple distribution points, so on and so forth. It's also this whole conversation about brand and instructor, and do brand and instructor compete or do they work together? And so I feel like there's a lot of learnings inside the record label model relevant to how we could structure these relationships between music, between the instructor, between the brands, between choreography, how we approach it, how the approach with creating a label happens has a lot of learnings within that model. And I think that model has application into fitness, and that actually is our vision. Our vision is that we believe we can actually bring fitness label into the fitness industry. And so that's something that we're actively working on. There's a lot of things that go into that, and we're not in the market with that yet, but that's that's where we actually think it would go. Hence why we built the service model to support that.

Yeah, interesting. Yeah, what I like about what what you're doing here is it's applicable to all of them. I mean, I see uh I've asked so many people this question is like, hey, what piece of fitness like technology do you think is going to have the biggest impact on what we do in the next 10 years? And you know, you get all the answers from AI to VR, AR, wearables, social media. You know, most people say, you know, the the person in your pocket, as you said. I think the is that you referred to the cell phone. There's so many things, but you seem to branch across all of those with what you're doing.

Yeah, we we look at kind of three areas. Number one is we want to be the service platform of the future to help fitness businesses launch, right? And so we digital is one side of that. We also think that you know there's potentially the event side to the business that doesn't take place inside clouds. We think there's a lot of areas where fitness may potentially happen. And right now, when you look at the companies that do it, they do it internally. Like there is no third party you can go to and be like, yeah, I want to do that too, help me. And so when this all went down, in our viewpoint is kind of like this there's a gold rush. We have no idea who's gonna find the gold, but we'll sell picks and hammers. And so that's the service model. We're here to serve, we're here, we say built for fitness creators, we're built to help you. That's it. We're not gonna compete with you, we're here to help you. And so that's the that's the baseline of the foundation on the service side. Then we do see opportunity in technology. However, we don't see the opportunity in the media type. We think that's a commodity of the delivery of the video, things of that nature. We see value around content optimization, operational optimization. So we fully intend to move into the tool side to help businesses using technology to improve that side of their business. And then last but not least is the model. And that's obviously the fitness label model. We think the business model has the ability to change. And just as we talked a little bit about in timing being a key factor, there's a timing factor to that. So we're incrementally releasing this and helping our customers in a staged approach.

Yeah, that's great. I I'm a big fan of the picks and shovels analogy because I think it helps people understand what's going on right now. Uh, because there is a mad gold rush. And, you know, some of the picks and shovel companies that I've seen that are just absolutely crushing it are things like online platforms, true coach, team builder coaching services, service-based things like what you're doing here, people who are, I guess, essentially sharpening the new era, right? They're not they're not the miners of gold, which would be the fitness professional, because a lot of them will strike gold, but it's a really good time to be in the pick and axes and shovels and sphere of things. So yeah, it's it's a great analogy. And I think people can really, if they can wrap their head around that, what that concept means, they'll they'll start thinking the right way. Yeah, I agree. You mentioned too, previous to recording, Mike, that there was some machine learning that you're working on, some AI. Can you allude on that as well?

Or yeah, so we identify a pretty big gap in the data side as related to streaming. And what I mean by that is that there's multiple sets of data that are required to operate these fitness streaming businesses. And so we started on this last year where we were focused on how can we go ahead and pull all of that data into one single platform where we can number one present it like traditional BI in a simple, easy-to-read dashboard specifically for fitness streaming, and apply machine learning to that so we can make recommendations in real time using machine learning AI. And so we are already in POC on that with the proof of concept and partner with a great development company specifically around this. And so we will be in the market, probably more towards the latter part of the summer here with that product. So we'll be the first and only company that I know of that specifically has a fitness streaming data layer and using machine learning and AI to make recommendations on top of that. It helps the customer because it saves them time with having to pull all those reports. It also saves them resources because they don't have to hire somebody to infer what that data means and what to do. And then the recommendation comes up, and that actually for us gives us a moat around our service, but it also goes ahead and allows us to get better at service because we have that data too, and we can actually dive into a customer and say, these are your top three things, and we're gonna solve them. We're gonna take this metric to this, and it makes service that much easier to understand and measure the effect of ROI against it.

Okay. So let's say, let's just run me through an example here. Let's say I'm Bobby, mid-level accountant at a firm, now working remotely from home, looking for ways to now engage in my health and fitness and improve my health and fitness. How does this technology or your concept help me improve myself?

Yeah, well, this is more on the B2B side of the equation. So it's gonna be on the on the B2B side versus the B2C.

Okay.

So it would be the flip side, and I'll kind of give you an example of something that's real time right now. And that is how many clubs actually know what percent of their members are using their streaming solution? How many? And then how many of them actually know what members that use their platform are within proximity that they actually should deploy a digital the retail strategy to pull them into their retail facility. And so when you pull the data sets in order to do that, and you figure out where IP origination is and all the different more sort of complex things that people may not understand, and you look at that and I serve that list to you, and I say, here's those lists. Buy these way. This person wants to cancel at 999, they're within proximity to come to your facility, give it to them for free. You don't give it to free to the person who's a thousand miles away, but when you have that data and you can look at it in real time, and now I can say, like, how do I message and how do I market to these people? You can really do proper market segmentation for marketing segmentation. And those things will improve your business because they will improve the retention, they will improve the capture rates. And that's just one example that's really relevant to today because when you go open that facility up of your digital members, there's a certain percentage of them that you could get into the facility, and there's a large percentage of them you probably can't. And you probably need to know that, and you can build these sort of what I have always called this industry need this dynamic profiles. You need a profile on your member that changes. Right now we have a lot of static profiles and people's lives change daily. Yeah, interesting, man.

Data.

Yeah, yep, data, data, data, data. Yeah, data, data, data. That's the that's the gold too, right?

Oh, it is. It absolutely is. I did a uh interview with Ian Millane of uh keep me.ai months ago. It was amazing to me at how even with the most basic data on someone on a member, how much you can learn when it's manipulated correctly, you know, just from their age, their location, frequency of you know, attendance, just the basics, if it's dealt with well, what you can learn from just that. And it's it's pretty mind-boggling. Mike, I always ask this question towards the end of the interview because you know, I like to get people connected and make sure that you know my guests and and my listeners are connecting when and when it's possible. So, what is it right now, you know, at the current state of things and um once again, it's June 5th, 2020. What is it that you need right now? What are some of the challenges that you're facing? What is it that uh the industry can help you with?

Yeah, well, I think what I need is I need more time in my day, that's for sure. Yeah. A lot of opportunities and things to be done is is quite dramatic. But from an industry perspective, I think I need people to embrace this digital online transformation. And just because it's not working for you, don't say it doesn't work. And what I mean by that is that you may be executing the wrong things. And so reach out for the help because I live by this. I don't know what I don't know. And I will give you an perfect example that majority of people who got into this space got into this space to connect with their member longer, extend Lifetime Value. This is pre-COVID. And depending on the business model they ran, I'll just put that caveat out there, they actually realized that close to 70, if not 80% of the users of that platform were not members. And so you set out with an objective to solve something with this strategy, and you ultimately discover this opportunity, you've got to be open to that change and you've got to embrace that. And I'm gonna just say that online, digital, over 10 billion streams, it's here to stay. So if you get frustrated and it doesn't work, just like anything, sometimes you've got to do pivots and sometimes you gotta find that product market fit.

Awesome. Well, Mike, I uh I I greatly appreciate you coming on. Where do people get a hold of you? Give us all that.

Yeah, for sure. So my email address is Mike H at Endorphins. Endorphins is with a z uh dot net. And you can always try us at the office, even though no one's there. We'll get the phone call routed. It's 833-227-4469. And uh we're here to help. And we've been taking calls and helping and pointing people in the right direction, and we can typically get you somewhere within 30 to 60 minutes uh pretty fast.

Right on. Right on, Mike, thank you so much for coming on the show. It's been uh it's been a really interesting conversation and uh yeah, it's fascinating time. So I appreciate it.