Writer: Meng Xiaobai
According to “2016-2017 White Paper on China’s Fitness Industry” issued by Green Orange, China has nearly 40,000 health clubs and fitness studios. In 2016-2017, fitness centers in many second-tier cities grew by more than 100%.
However, according to CNSTYD (三体云动), a SaaS solution provider involved in the intelligent management of fitness studios, the information they had suggested that there were already about 200,000 fitness establishments across the country, including fitness studios, yoga studios, dance studios, and boxing rooms.
Among them, more than 10,000 clients are using its SaaS management system in their 12,000 physical stores, CNSTYD claims. 20% of the clients run large stores over 3,000 square meters, and the vast majority run small studios with an area ranging from 300 to 500 square meters.
CNSTYD began to realize a profit in December 2016. Its revenue is expected to reach tens of millions in the fourth quarter of 2017. A client pays an annual average of ￥10,000 for the SaaS services it receives.
More than 500 clients joined CNSTYD’s customer base in the past month, largely as a result of public praise.
The services CNSTYD currently provides for fitness establishments include SaaS management systems, digital marketing tools, and intelligent hardware.
Among the three major products, SaaS is a complete solution for fitness establishments that covers both front-end and back-end operations.
Users can do internal management in the background, or directly handle members, who can manage their own information and courses on WeChat.
The demand of a fitness institution depends on its type and size. In addition to the seven versions developed for different scenarios, CNSTYD has also developed multiple modules and plug-ins to facilitate customized development.
Besides shop management, CNSTYD enhances the user’s operational capacity with marketing plug-ins and data analysis. The system provides multiple marketing schemes for users to choose from, such as group booking, lottery, and WeChat interactive wall.
Not only that, the system can also automatically categorize clients as high-net-worth members, middle-tier members or members that are likely to leave, and provide users with effective tools to improve customer retention and value-added consumption when appropriate.
While growing in the fitness industry, the team continues to expand its services vertically and horizontally.
Vertically development involves providing services with higher added value for customers in the fitness industry. A service currently being promoted is associated with smart Internet of Things. It is a complete set of smart solutions for offline stores concerning intelligent access control, gates, lockers, sign-in units, and cameras.
The deployment of a complete set of smart store hardware in stores ranging from 300 to 500 square meters in size will cost ￥60,000 to 100,000 (around $9,072 to $15,121). Another service that CNSTYD may engage in is finance.
According to the big data accumulated by store operators and members, CNSTYD can provide them with installment financial services to help them pay coaching fees.
New areas of horizontal expansion are the beauty industry and the training industry. CNSTYD targets customers in the whole life-support industry that implements membership systems. The prepaying system and semester system in the training industry are similar to those adopted by the fitness industry, so CNSTYD is conducting cooperative tests with more than 100 opinion leaders in the industry. The tests are expected to start in 2018 nationwide.
CNSTYD will eventually set up branch offices in 10 cities to help expand the business in the domestic market and conduct offline marketing targeting regular customers.
CNSTYD’s team has a total of about 100 employees, of which more than 30 are product and technical personnel, more than 50 are sales and customer service personnel, and the backbone staff are from Alibaba. Its founder and CEO used to work as a senior product expert at Tmall, and its CTO was formerly an architect with Shanda Networking.