BUILD or BUY?Club Mobile Apps:

By

My role at a leading mobile technology company focused specifically on health clubs has

exposed me to many great discussions about mobile strategy with leaders of the fitness

industry. With large organizations, these conversations have converged on the same

fundamental question: Do we buy or do we build our mobile apps?

This guide represents my perspective on the buy vs build question in the context of

mobile apps for health clubs. This dilemma is nuanced by the rapidly changing, consumer-

facing nature of mobile technology. It’s set with a backdrop of a brick-and-mortar

industry that is struggling to understand its digital future, and a mandate for useful,

relevant, and personalized interactions.

I’ve strategized with large organizations in the fitness industry that have gone both ways

(bought and built), and I’ve learned quite a bit about the motivations driving these

decisions. I hope my perspective will highlight some potential pitfalls and assist you in

your decision making process.

JOHN FORD

President of Netpulse

“If you don’t launch a Club Mobile Appthis year... you’ll be behind.”

BRYAN O’ROURKE

President of Fitness Industry Technology Council

Table of C�tentsPART IDecision-Making Framework

PART II8 Criteria for Analyzing Health ClubMobile Strategies

PART IIIBuild or Buy?

PART IVSelect a Fitness Industry-FocusedMobile Platform

pg. 4

pg. 5

pg. 12

pg. 15

3

Technology projects are often made or broken in the very early stages when organizations

are establishing the criteria for success. In addition to some classic technology project

criteria, there are several principles that address the major forces present in the health

club mobile space. Specifically:

I’ve identified 8 key criteria for use in analyzing health club mobile strategies.

I break them down in the next sections.

A significant gap exists between consumer expectations and current club mobile app offerings.

Consumer-facing mobile is a rapidly evolving landscape.

Digital disruption is real. Risks and opportunities for the fitness industry are significant. Winners and losers will be determined.

Devel� a Decisi�-Making Framew�k

4

8 Crit�ia f� Analyzing Health Club Mobile S�ategies

Get to Market Quickly1

Getting to market quickly is a standard consideration for any technology project.

However, it’s especially important here given the growing number of fitness industry

leaders who are already up and running with health club mobile strategies. All 10 of the

top 10 global fitness brands have either recently launched or are working towards

launching a major mobile initiative. The adoption of mobile applications over the past

several years continues to demonstrate a willingness and an expectation to inform, interact,

and transact in mobile environments. Yet health club mobile applications are not meeting

customer expectations today. This gap represents a clear, high value opportunity that

leading organizations are pursuing aggressively. Competitive pressure, combined with a

clear opportunity to provide a better member experience, equals a premium on speed to

market for the project.5

Develop a long-term strategy, not a feature list2

A common issue that I’ve found in discussions with operators is the perception of a

mobile app as a static “thing” that they need to have rather than what it actually is:

a rapidly evolving and critical new business channel. Below are a few common decision-

making patterns that organizations have:

The problem with the three mindsets above is the same: they will result in a feature-

focused, short-term mobile solution that may meet an immediate set of needs, but may

also handicap the organization long term.

We have internal initiatives for new programs and services that require mobile.

We need an app that supports these new programs and services.

Mobile is in, desktop web is out. Members should be able to access everything currently available on the website via a mobile app.

We need an app that does every-thing that our website does.

Motivation Common Reaction

Competitors have launched apps that do A, B, and C.

We need features A, B, and C in a mobile app as soon as possible, usually with additional feature D to differentiate from the competitors.

6

Plan for Constant Changes in the Plan3

A long-term focus shouldn’t simply be an

extended list of features that will be

completed in later phases of the project.

Ideas for what the organization might do in

the future are great to have as part of a

larger set of requirements, but they don’t

meet the need on their own.

The issue with feature-driven planning is

that consumer-facing mobile technology is

changing so quickly that no one can accurately

forecast what opportunities or risks are

ahead for the fitness industry. If plans

shouldn’t be focused on the short term and

purely feature-driven, long-term plans aren’t

the right answer either, then what is?

The specific features to build in version 1 should be secondary to this goal. How much will

it cost to develop and implement a totally new digital program that we think up next year?

How long will it take to respond to a new compelling digital offering by a competitor?

These are questions you should prioritize in your decision making process.

The solution is to ensure that the right foundation is in place for efficient, rapid iteration and

experimentation with digital platforms.

7

Without partners that are highly focused on andexperienced in the risks and opportunities in the fitness space, you’re much more likely to make costly mistakes.

Deliver a Technology Hub5

The same uncertain, rapidly changing landscape that warrants staying flexible also drives

the need for involving deep, industry-specific mobile expertise in your project. Heading

into uncharted territory at the same time as your competitors means that you can’t

borrow someone else’s technology roadmap to guide your journey.

4

The average app that my company launches today already contains 15+ integrations with

various club systems and 3rd party technologies. Clubs are rolling out an increasing

number of integrated digital services and this trend will continue. Loyalty programs, booking

systems, eCommerce programs, nutrition programs, training programs and more are all

going digital, and they all need to be accessed by your members easily in one place.

That place is the Club Mobile App.

Your plan must consider the resource burden of all of the integrations that you’ll require

to deliver apps that truly serve as a digital hub for your expanding programs and services,

as well as all the external apps and services that your members will expect to access.

Involve Fitness Industry-Specific Mobile Expertise

8

Plan to Keep Your Mobile Platform Current6The modern app requires constant effort to take advantage of new mobile platform

enhancements. New devices and operating system releases from Apple and Android

need to be supported quickly. New authentication, communication, payment, and other

mobile platforms provide tremendous opportunities to leverage the most advanced

technologies. Just keeping mobile apps connected, integrated, and up-to-date requires a

substantial amount of resources, expertise, and focus going forward.

Focus on Innovation and Differentiation7

A club’s mobile app must represent its brand in every way. In the future, it’s quite possible

that more member-brand interactions will take place within the club’s mobile app than

anything else. Brand isn’t just about look and feel, it’s about exposing the right digital

services for the club’s demographic and pushing innovation that fits the brand.

With that said, innovation is hard. It’s an all-consuming process that requires focused

energy by people with a wide range of skillsets to execute successfully. Innovation is

where knowledge of the customer is most critical, and no one should know the members

of the club better than the club organization itself. For all of these reasons, innovation is

where the organization’s efforts should be focused.

9

Choose a path that lets youfocus on the customer-facingexperience, not the plumbing.

Unfortunately, supporting successful mobile apps is a continuous process that requires

much more than just innovative new digital programs and services. It requires quite a bit

of infrastructure and a significant amount of grunt work. This work comes in the form of

foundational app technology, basic feature requirements (such as a club locator),

integrations, and seamlessly addressing app lifecycle issues, such as the OS and device

updates.

Building these foundational elements takes a lot of resources and provides no

differentiation for your organization.

Brick and mortar businesses would never consider building their own power plant for

electricity, nor do they think about setting up their own dedicated water system. Building

these things would come at massive expense and give them no advantage over their

neighboring competitors, who also have water and electricity for their businesses. The

same concept applies to digital plumbing.

10

Fitness organizations who ensure that they meet all of these 8 key criteria will be positioned best for success.

Recap

We all know that mobile is critical

to business in the future, but

without clarity as to exactly how,

ROI and budget conversations

can be difficult. The goal should

be to avoid a high-risk, massive,

multi-million dollar version 1

project. By staying flexible and

efficient with your resources, you

can get in the game and prove

out specific digital programs that

warrant further investment

before breaking the bank on

unproven strategies.

$

$$$$$

#####

Deliver a Future on Today’s Budget8

11

Build � Buy?

BUILD BUY BUY + INNOVATEHaving established 8 key requirements to guide the buy vs build decision, the next

considerations are the purchase options. There are several choices here worth identifying:

complete mobile solutions, club-focused mobile platforms, and generic mobile platforms.

I would define these as templated apps that offer some light customization on top of the

template and not much more. I’m not going to spend a lot of time covering these, because

they are obviously a bad fit for the fitness industry. These apps are quick to get to market

and inexpensive, but fail badly on requirements #3 (stay flexible), and #7 (differentiate and

innovate), primarily due to limited customizability and lack of integrations to key industry

technologies.

Complete Mobile Solutions1

$

12

Once it’s established that a flexible mobile

platform is the right purchase, the question

turns to which platform. There are a significant

number of mobile platforms available, and

many custom app developers have their own

platforms that they use as a base for apps that

they churn out.

I believe that any time you are embarking on a

technology partnership as significant as your

core mobile initiative, it’s critical to find the

right partner. Buying a platform is buying into

a long term partnership. While any good

platform can provide advantages over starting

from zero, requirements #4 (include strong

fitness industry expertise) and #5 (deliver a

connected hub) dictate going with a fitness

industry focused platform.

If you choose a partner that does not do health club mobile apps as their core focus,

then you are not adding the health club mobile expertise that you need to be successful

long term. You’re not adding partners who have done it before and understand the

pitfalls. You’re also not choosing a platform that is already linked to dozens of industry

digital providers (billing systems, etc.) that will be required to deliver truly enabling solutions.

Choosing a fitness industry-focused platform partner results in full realization of the

significant resources that the partner invests every year to build and evolve the platform.

All platform improvements are targeted at the fitness industry and relevant to your

organization. It becomes clear that the most successful organizations will choose an

industry-focused partner.

Mobile Platforms: Club-focused vs Generic2

13

‘Build’ vs ‘Buy + Innovate’3

After establishing 8 key requirements for successful mobile strategies and identifying

industry focused mobile platforms as the viable solution on the ‘Buy’ side, it becomes

clear that the ‘Buy’ option actually has a heavy dose of ‘Innovate’ in it. In order to meet the

requirements of a digitally-experienced member base, leading brands must focus on

customer facing innovations and experiences. The question left to analyze becomes:

Do I build from scratch, or buy the platform infrastructure and innovate on top of that?

Let’s analyze this question against the 8 key requirements:

Requirement

Speed toMarket

Avoid FeatureFocus

Flexibility toHandle Change

Are you budgeting for theinfrastructure that you needto handle the changes?

Has the team done a healthclub mobile app/platformbefore? How many times?

Requires significant timeand investment.

Requires substantialexpense and focus cost.

Involve Strong,Industry-SpecificMobile Expertise

App as aConnected Hub

Plan to StayCurrent

Innovate andDifferentiate

Deliver on aReasonable Budget

Build Buy + Innovate

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3

4

5

6

7

814

Select a Fitness Indus�y-Focused Mobile Platf�m

I’ve spoken to many organizations that assume that if they don’t build everything from

scratch, their ability to differentiate will be constrained. After all, company X uses the same

mobile platform they’re considering. The irony is that leveraging a platform that provides

and maintains infrastructure actually allows the organization to focus all of its energy

on creative innovation, greatly increasing its ability to differentiate with mobile technology.

As seen below, you can build the innovative features and buy the rest.

A good mobile platform gives the organization a mobile base on which to build on. It

allows the app to look and function the way the organization envisions. Finally, it enables

the organization to focus on the high-value initiatives that are going to make a difference

for their business.

Custom UI and Digital ServicesCustomer-facing innovation space

Native iOS/Android Mobile PlatformOut-of-the-box support for basic required features, device, and OS standards

API PlatformCritical integrations with industry service providers, fitness tracking support, 3rd party fitness app and device support, out-of-the-box support for basic features

1

2

3

DOYOURSELF

BUY

BUY

15

I hope this guide provides a framework to support your decision-making process.

I would enjoy any opportunity to share further insight and experience, so please feel free to

reach out to me any time.

JOHN FORD

President of Netpulse

planetfitness

fitness club

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