The group fitness industry, a 6 billion dollar industry, is the fastest growing segment of the 27 billion dollar fitness industry as a whole.
“It is a new and developing industry,” says Alicia Thomas, Founder and CEO of Dibs.
Dibs is a pricing platform that helps fitness studios price more efficiently, using a proprietary algorithm. They allow studios to offer dynamically priced schedules in order to fill classes to capacity and maximize revenues, which is similar to airline pricing, hotel pricing, and companies like Uber.
“It allows them not to leave any money on the table,” says Thomas.
Thomas used to run Kiwisweat, a company that brought fitness to unusual locations, which allowed her to get to know all the stakeholders, studio owners, instructors, and students of the fitness industry. She noticed that many of these classes are very inefficient, even the most popular fitness centers still have empty slots in their popular classes.
“What we’re saying is, instead of there being all these excess inventory in the first place, let’s help that not exist in the first place,” she says.
Using a revenue-share model with studios, Dibs will try to get them the most money, but at the same time, making sure that they are increasing their bottom line, depending on the quantity of transactions. They are also focused on creating long-term partnerships with studios and aim on filling slots in classes with people within the studios’ target range, based on information like distance, age, sex, and how much they spend on fitness.
Instead of treating all classes as equal with all the same prices, Dibs looks at classes based on demand and price them accordingly. Users can get into literally any class they want that is convenient for them, and pay an affordable price. Meanwhile, studios can fill empty spots in their classes, and pricing them without giving out huge discounts and losing profit. They also built rewards into their systems so members of studios Dibs works with get priority.
“The discounts across the board are hurting the industry in a lot of ways because it devalues a really premium product,” says Thomas.
Since launching in June, Dibs has been working with 10 studios and has increased revenues significantly, by 57% on a small test pilot in New York, which has been receptive. Food, fitness, and fashion, according to Thomas, are now merging as one entity in health and wellness. In a city well-known for people with daily routines, Dibs caters to them and their fitness routine, ensuring that they are able to get into the class they want, in the studio that they enjoy going to, and at the time most convenient for them. All without spending outrageous amounts of money.
Dibs pilot program is running until September.