By Chris Cooper, planning director at digital commerce specialist smp
McKinsey research says the number of customers planning to buy fitness and wellness products online has jumped 29% since the pandemic hit. Digital commerce is enabling those brands to build direct relationships with consumers, rather than relying solely on the indirect relationship via wholesalers and retailers.
This is helping brands like Adidas, Peloton and Fitbit shorten the purchase journey. By blending digital marketing and e-commerce into one experience, they avoid what Google describes as the ‘messy middle’, where shoppers bounce back and forth between exploration and evaluation before purchase.
What this means is the days of fitness and wellness brands selling just physical products are long gone – although those products remain a key part of the offering. Today’s successful brands are building their digital commerce offerings around their services and community as well.
A new wave of marketing for physical products
Social media is the driving force behind a lot of modern fitness brands. GymShark, a brand that was born from a direct to consumer (D2C) model, quickly saw the potential in social media after it sold out at the 2013 BodyPower trade show in Birmingham. The Luxe tracksuit went viral on Facebook and resulted in thousands of pounds of sales in only 30 minutes.
This isn’t the only example of how the purchase experience is changing, and in many cases mobile apps are leading the charge. For example, Nike S23NYC is a digital studio in New York tasked with developing Nike’s SNKRS app and reimagining how Nike sells shoes.
It has gamified shopping experiences, including creating high-tech scavenger hunts for limited edition sneaker drops. Patrons were alerted through the app that new Air Jordans would be available at three designated locations – and if you weren’t there, you were out of luck.
The SNKRS team has also tailored its products to its customers. Having learned that most app users in New York were of Dominican descent and based uptown, the team created a product specific to that community, hired Dominican photographers and employed local shops and landmarks to release the shoe.
Nike has also used the app to partner with a famous restaurateur for a limited-edition shoe available only when visiting a Momofuku restaurant.
Services over and above the product
Many fitness brands are also creating new revenue streams and building loyalty through the development of paid-for services that fit into the brand’s ecosystem.
For example, Fitbit might seem like a physical device manufacturer, but the wearables serve as a gateway to a broader digital user experience via the Fitbit app. This is where all of the tracking data collected by the devices is truly brought to life in ways that change fitness and health behaviours.
Alongside standard app functions, Fitbit now offers Fitbit Premium, a subscription that offers deeper insight and coaching on users’ sleep, activity and stress. This creates a direct transactional relationship with customers (as most devices are still bought via retail) and builds further value, encouraging users to stay within the Fitbit ecosystem.
Similarly, competing wearable brand Whoop has bundled its device and services offering into a monthly, subscription-based fitness membership.
There are also a number of brands in the health and fitness space that are going the other way. Services-first brands like software company Zwift, the subscription-based massive multiplayer virtual cycling and running training app, have been creating partnerships with hardware brands.
This approach echoes the use of joined-up ecosystems in other segments, such as the smart home, and by doing so, Zwift users can unlock more functionality within their app. The business recently partnered with hardware brand Elite to enable in-game steering via a hardware steering block that connects directly to the app.
The importance of community
A large number of fitness brands have focused on building communities online, which enables a direct relationship with consumers for ongoing e-commerce sales and loyalty. GymShark was also an early adopter of the influencer marketing model. marketing products through its community of Instagram influencers and YouTubers and highlighting its sponsorships of well-known athletes.
In addition, Adidas Creators Club is building a community through its app, which is tightly linked to e-commerce. Using game style rewards, members gain levels to access member-only product launches, access to limited edition shoes and apparel, and exclusive events.
Nike, meanwhile, connects with culture to sell trainers and apparel, and part of that connection to culture is through building a community. Nike Run Club (NRC) mixes a real-life and digital community centred around the NRC app, which offers members access to tracking, guided runs and personalised coaching. The massive amount of data generated then provides a huge amount of insight for Nike’s e-commerce efforts and helps the brand to encourage loyalty amongst consumers.
But Peloton is perhaps the prime example of the moment, as another brand born D2C that has grown to new heights during the COVID-19 pandemic. It has connected and built a community around its physical indoor bike hardware and spin/exercise classes as a service.
Its community is a key part of driving engagement and retention through social reinforcement. The class experience sees instructors challenging you to keep up with them, pushing users to do their best and keeping their energy and positivity up. Like Nike, Peloton is also building connections to culture, having recently announced a new partnership with Beyoncé to offer bootcamp, strength and spin workouts on the app.
In fact, most fitness brands now endeavour to offer some form of community, particularly at a time when we can’t go to the gym. High-end cycling kit brand Rapha has the Rapha Cycling Club (RCC), which offers members access to members-only products as well as an app-based social network alongside real-life rides and access to high-end hire bikes at Clubhouse (store) locations around the world.
And for many years Lululemon stores have been the centre of the brand’s community, built around workout studios in flagship stores and in-store events. It has focused instead on its online community since the outbreak of COVID-19 and now covers meditation, running, yoga, training and personalised goal-setting workshops.
E-commerce is the new commerce
Since the pandemic, the importance of digital commerce has skyrocketed in every category. Fitness brands, like others, have had to progress several years in only a few months and are focusing on managing their products, services and community development online to help them succeed.
The fact that so many are doing well shows the value of those three pillars, and the importance of a coherent digital strategy to underpin them.