The evolution from fitness to wellness with Andy Peat | Industry change Episode 24

Welcome to Industry Change. I am Richard Toutounji, and today I'm at the headquarters of Snap Fitness in New Zealand, and I've got the COO, Chief Operating Officer, with me, Andy Peake. Good to have you.

Thank you, nice to be here.

Thanks for that. The offices are pretty cool. We've got a great vibe out there. We've got the hustle quote on the wall here. It's a very, uh, it's a very open space to really create and do some, uh, do some very innovative ideas and some concepts. Is that what it's set up for around here?

Yeah, it's just, it's set up to inspire. It's set up to be a fun environment for, for our team to come in and, you know, and enjoy themselves at work. High energy.

Yep.

And, um, not feel like they are performing a chore more than anything. So if we can make it fun, we get the best out of them and And everyone's happy, you know, outside this office within our network.

Great. Well, we've been visiting here and you've been a great host yesterday. We dropped into a few Snap Fitness clubs, checked out the vibe and the energy there.

Cool.

And I guess what we're seeing here in New Zealand, and especially with the Snapwork, there's over 250 locations, well, in Australia and New Zealand. You've been the CEO of Snap over the years. You've had many leadership positions in that. You're the COO now and you take care of basically New Zealand. I did want to dive a little bit more in New Zealand. What's the differences? You've had 9 clubs, you're very experienced in this gym world. So there's a few, there's a few ways I want to take this interview. One, it's the innovation part. Like, you started very early in this, you were about 17?

Yep.

Yep, you worked on cruise liners, you spent a lot of time learning about sales and marketing like I did on cruise liners.

You don't sell, you don't eat.

Yeah, you don't sell, you don't eat on cruise liners. That's a great experience that we both had. And now you've continued to innovate. You've bought gyms, you've sold gyms, you've moved into very senior roles very fast, very early. Tell me, tell me the level of how you've been able to do that. Was it timing? Was it skills? Was it knowing people? Was it relationships? What were the fundamentals for you to— and you've got also a technology business I want to deep dive in today.

Yeah, sure. It's a good question, and You know, upon reflection, you look at it and it's been a crazy journey going from personal trainer to cruise ships to franchisee to CEO of Snap Fitness Australia, one of the, one of the major kind of 4 24-hour chains over there. And, you know, I did that at a very young age. And

what age were you CEO?

I became CEO, I got the job when I was 24 and I started when I was 25, so there's a bit of a time there. Time thing there. And yeah, it was, to answer your question, it was a combination of all of the above. There was timing involved. Yep. There was a bit of luck and there was proven skill. But in all honesty, the only reason I got that job was because I put myself out there and I knew the people I was talking to in the sense of I knew what they needed to hear in order for me to get that opportunity to then learn and prove myself. When I started that job, I had no right to get that job from a skill and experience. I was 25 years old, no degree. I was great at selling franchises and great at selling gym memberships, but running a $100 million plus business is next level. So I essentially talked my way into it and then did a good enough job to be able to stick around.

Well, I think that's it, you know, you've got to talk your way into everything, but most importantly, you actually delivered the results, you delivered the goods. How do you deliver results and goods when you, when you're learning? Is it learning? How did you go deep in actually making that a success?

You know, the first, first 3 months I really took a bit of a back seat.

Yep.

And I observed, observed, and I learnt both the goods and the bads of, you know, the operators within the industry and within our particular business. And it was, it was backing my own ideas and my own flavor and not just coming up with ideas and telling people about it, like actually going through with it and doing it and That, that I think straight away is a big separator in operators is follow-through.

Yep.

And then I, I've always enjoyed people and relationships. I feel like, you know, I can show a lot of empathy as well. And because I was a franchisee, franchise— other franchisees were able to resonate with me because we were on the same page, as well as me being the franchisor. So But outside of work, honestly, during that time period of my life, it was just a relentless study mindset. I studied business, I became a student of business, a student of fitness, a student of industry, and I just learned from people from 100 years ago, 200 years ago, to the tycoons of industry today. And I read everything I could, and I listened to everything I could, and I watched things on YouTube, and I'd just be my free time studying. And even at the time, you don't— you're not sure that it's paying dividends, you're not sure it's working, but over time you realize you're using things that you learned. And, you know, particularly in that case, I took a keen interest in finance, Wall Street, like that type of life. And it wasn't until 2 years later where I was dealing with private equity out of New York buying up, you know, Snap Fitness and buying fitness chains and But I was able to be on par with them and talk the same language and sit in a room and not be out of place. And I realized it was from all that study I'd done a couple of years prior.

Wow, so you went deep. And when you went deep in that study, it sounds to me that you had a lot of discipline for the study. Was the discipline— did the discipline come because you had the job, or the discipline come because you wanted to see, hey, that's where I want to go in the future?

Yeah, a bit of both. Okay. The urgent need was I had a job. Urgent need. And I didn't tell anyone my age.

Okay,

and the network.

So we've both lied about our age. I remember when I first built my business at 17, I said everybody I was 21. Yeah, yeah, that's, that's a good, that's a good hack, right?

Yeah, when I was on cruise ships, I was, I was 18, 19. I told everyone I was in my 30s.

Yes.

And then when I was in, um, the CEO of Snap Australia, I was just, I didn't want to lie, so I just, but I just didn't,

didn't tell

them, didn't tell anyone. And people would make assumptions, and maybe the beard, and it definitely aged me. So I lost a bit of hair, and they just made their assumptions, and then I'd turn it into a bit of hair. Humor. So until I could prove myself. But yeah, the motivation came to learn adult talk, learn that adult chat early so I could stand toe-to-toe with these franchisees and just give myself enough time. I knew that I'd be able to deliver results. I knew I could do the job. I just needed to buy myself some time to be able to get an understanding and then back myself and on a couple of things. And, um, the true, I think, test back then was actually in adversity rather than everything going well. When a couple of things went wrong in the business,

yeah,

and how I felt dealt with that was very much, um, that kind of— the youth came out of me then where I just got back on the tools and got my hands dirty,

yep,

and grinded out where maybe someone a bit more senior would would still delegate, delegate, delegate, where in certain times of adversity I was able to, um, get stuck in because I didn't know any different. So the youth was both a disadvantage and an advantage.

Yeah, I, I remember back the early days when I was in, when in business, when at Business 17, the youth definitely is on your side, but it is the disadvantage. I think, I think in any opportunity where you're at, you've got advantages. I think you must play with your strengths there.

Yeah, yeah.

Let's start veer towards, because you've been a bit of an innovator as well, you know, you Some would say, okay, wow, you got a job as CEO, you're the COO, you're back from Australia and New Zealand, you've bought and sold many, many clubs both in Australia and New Zealand. But, but you're also looking at the future. And we said before that you're moving into technology. We have moved to a technology business. I'd love to know more about that because you saw the problems of retention, you saw the problems of sales, mental health, you saw the problems as well. And you said, hey, let's put it all together on, on an app that not just is used for Snap or yourself, but actually is used for gym owners as well. I'm very curious about that. Tell me

about that. Yeah, it's been an interesting story. So I, um, when I was running Snap Fitness Australia as the CEO, I, you know, it was right around the time in Australia where, and you'll know from being a Sydney boy, everyone was getting into their like acai bowls and their smoothies and those businesses were popping up. So nutrition was the thing that people were putting on social media and they were talking about it. And whilst I hate that,

yep,

I understand it. And I think if you're going to be a gym operator or any fitness professional and you're serious about results, you have to offer some sort of nutrition.

Sure.

So

makes sense.

I couldn't really find what I was looking for, so I was like, you can't find it, just build it, right? So I partnered with a couple of people, created a business called Nomogy, which the whole thing was food, and it was food to create more energy for people.

That's the name, is it?

Yeah. Long story short, the, um, the— it didn't work out like a lot of business relationships don't. So I, I believed in it though, and I took it on myself, and we ended up turning it into a fully functioning workable app for, for Snap. We built the Snap app for it, um, for them, and the NineRound app for them. And I've since commercialized, and we build apps for gyms and personal trainers to to offer nutrition, programming, so just taking paper out of the clubs and doing all the programming through the app.

Yep.

To allow the gym to connect to their members better and allow members to connect to each other. It's what we use for our 6-week challenges. It's what we use to upload new content on for education. Then we use the power of technology and machine learning to be able to make it as personalised as possible. Fast forward a couple of years later, we've, you know, we've reduced attrition by a couple of percent within the Snap Network from the people that use it. We sell more MyZone belts than any other, any other brand in the world here in Australia and New Zealand through, through that technology. Rather than just selling a belt, we sell a solution to someone's problem, and the belt's just a tool that they use. And we're coming up with a couple of, you know, great features that launch next month whereby Member experience becomes the key feature. So when a member is attending the gym, you know, the app will prompt them to rate their experience out of 5. And if it's a 4 and above, it will push through to their social media ratings and their Google reviews. And if it's below, it will prompt for feedback. So member experience, particularly in our Nine Round brand, our boutique brand, is paramount to me right now. So I'm using technology to measure it, taking a chapter out of Uber's book. where they have their rating system and that's what their KPIs or their drivers are, and that's what my trainers' KPIs will be.

Right. It's, it's so an interesting story because, you know, a lot of gym owners are stuck in that— I don't know, that, that— I don't know if it's rude to say the gym mentality or the retention mentality, not seeing what the future is. You're seeing the problem, you went to technology, and you said all businesses are technology before. What do you mean by that?

I just believe that, you know, moving into the future, all businesses will become technology businesses. They'll just offer different services products.

Sure.

So, you know, we'll always be a service business. We'll always offer fitness as a service. It's just there's been a huge swing in the amount of gyms that are in Australia and New Zealand compared to the population and the amount of people who use them.

Yeah.

So you have to work to reality. And all us, you know, 24/7 gym operators, we were used to 1,200, 1,300 members in every club that we opened.

Yes.

And we'd just pat ourselves on the back and think we were good operators.

Sure.

The truth be told, a lot of it was timing.

Yep.

A lot of it was luck. And now the reality is, is a lot of our clubs get to that number, but they get through hard work. So how do you turn 800 members into the new 1,200 from a revenue standpoint?

Yes.

And it's attrition and it's yield. So offering things like additional services through technology allows us to keep our yield high and our attrition low. Because our whole thing is if we can get the member to commit to us within their first 6 weeks of their membership, we'll have them for a long period of time. And that's what we're trying to figure out. So I think that we're, you know, Lift Brands, through the use of technology, we are the pioneers of onboarding new members.

Yep.

And we have some pretty special stuff that we're releasing this year to ensure that we are showing, you know, the public and the world that we are We are caring about how their first initial six weeks are at the gym and that they're onboarded properly, rather than just being a sales machine or just member, member, member.

So so you're systemizing the sales process, systemizing the retention process, all through technology.

Yep.

And it's interesting because you're now taking that out not just to Snap brand twelve and sorry nine round. Sorry, I'll say it again.

You have to eat it there, but

yeah. I'll go back. It's interesting because you're not taking that out just to the twelve lift brands. You're taking that out to A vast majority of any independent. What was the decision there to go for that?

You know, obviously I like technology. I think I said to you before, the thing I like about technology is you either go bankrupt or become a billionaire, right?

Yes.

And not that money's not really a driver for me, and it just allows me to do things I like, like travel and have fun. But yeah, you know, I see an opportunity with it. So I've commercialized it. And the thing about NomaG is, is it's essentially 90% of any wellness business or fitness business who want their own app. It's about 90% of what they want.

Yes.

So it's a lot cheaper to have me build the 10% to customize it to what they want rather than they go out and do it themselves. And then, because I mean, you'll know from your experience in technology, as soon as you build something and you host it and You've got to develop it further.

Yes.

Take on users, customer service.

Version 2, 3, 4, and 100, yeah.

It's just easier to have someone else, and I've spent the money now, so might as well use me. So I can either white label the product to just be a straight white label for independents who just need that, or, you know, I've even built apps for genetic testing businesses who provide meal plans and workout plans based on your DNA. And that's cool stuff. I like doing cool stuff that's creative. So that's what really drives me.

Very good, very good. So moving forward, if you can predict, you know, what's going to be happening in media, I think you're predicting it through technology, but where's the future of— and I think we spoke yesterday, actually, I'll say that again, if we can cut that out. You mentioned as well yesterday when we were out at one of your gyms was that mental health was a kind of an an area that you're personally working a little bit deeper in your technology, plus Snap itself. Can you just give me a bit of a highlight why, why you've gone down the path of mental health?

Yeah, I think that, um, you know, it's such a big part of society now, and, you know, a thing that really offends me is, um, you know, Australia and New Zealand are 2 of the most beautiful countries on earth, the most free countries.

Yes,

yes, we have our problems, but compared to other places, we have no problems. And the fact that our suicide rates are the worst in the Western world, it's just, it's not good. And a lot can be achieved when someone just moves a little bit better, they eat a little bit better, they connect with some other people, and they feel like they're part of something bigger. So a couple of years ago, I started developing these 6-week challenges, you know, to raise money for charities for mental health.

Yeah.

And now I've actually used my technology to educate people and to give them tips and tools that they can improve their own mental health. And a lot of it comes back to gratitude.

Yep.

So we built a gratitude diary in there. Great,

great.

And it's just about forming positive habits for them to have a healthy lifestyle. So I think that regardless of brand, and you put the Snap thing aside and whatever, if you own a fitness facility and you want to be successful in the future, You've got to create a plan to show that your club and your membership goes beyond the 4 walls of your gym, and you are there for someone's wellness and not just their fitness. And that's both mental and physical nowadays. And that's the way the industry is going. We're going from a fitness industry to a wellness industry. And, you know, if you're going to be part of it, you have to offer nutrition, you have to offer fitness, and you have to offer the mental side of it. And you'll never be A counselor or psychologist, I'm not saying that, and don't try and be because that's dangerous. Yeah. But just let people know that things about things like gratitude and let people know about social connection and connecting your members together. And, you know, that can really change people's lives. And I see, I see stories that we get, you know, through our technology because they're prompted to write a story. And, you know, these are people who were on the brink of of giving up completely on their lives and just moving a little bit more, eating a little bit more, eating a little bit better, which is often more, right? Yes. Um, has saved them. And I just think it's just a simple thing, but to them it's not a simple thing.

So especially when you're in that position, you're stuck, it's the littlest of things of gratitude, thank you, just being nice, a smile.

Man, it's just kindness. We're just so fast-paced, you know, we live in such a busy world and And I think social media has a huge part to play. Both— it's both a good and an evil when it comes on the battle of mental health, because people only post the good things, right? And then you compare.

Well, they post the good things and they use those apps that we teach people to use and they make it look pretty.

Yeah, they make it look pretty. And that's, you know, I get that. That's fair call. Like, I have no problem with that. But I also just think that, you know, people— it's not reality as well. We just need to be careful. I think we need to sometimes go a little bit old school and just pick up the phone and talk to someone. And yeah, like you said, just be kind, smile, um, and that all comes back to your basics within the gym.

Amazing, Andy. You've got such a very inspiring and, uh, very cool unique story. Um, if, if somebody who's watching this who's maybe getting into their business and getting into their, their space, if you can give them one or two tips to Continue going maybe in not the easiest times they're going through, what would they be?

Yeah, sure. So business, like in life, is full of adversity and your character comes out in those moments. And just know that it's peaks and valleys, like they always say, peaks and valleys. And you only have the valleys to make the peaks even better. When you're going through the rough parts, just remember why you're there and use your heart and use your gut and back that up with the logical side of it and the analytical side of it. And if it makes sense, just keep going. But if you get into trouble mentally, financially, it doesn't matter. There's so many people that can help you. And just asking someone for guidance and help and knowing that you're taking action. That's probably my advice, is take action. Whether you're a gym manager, sales rep, or owner who's trying to get hold of the leads and trying to get more members, follow-up and action will solve a lot of your problems.

Sales solves the problems.

So more members solve every problem you've got, right? And now it's keeping more members will solve all your problems as well as—

Keeping more members, that's great.

As well as keeping that sales funnel working. So it's a bit of a balance of both, man. Just, it's a beautiful industry to be part of. It's full of opportunity for everyone, and you are doing social good as well as creating great living and great commercial life for yourself. So just, just enjoy the ride and just learn. Make mistakes, own them, don't make them again, and just grow.

Love it. Love the story. Andy, where's the best place to check out this amazing technology you have?

So nomadji.com is fine. It's O-M-A-D-J-I.com. No, N-O-M-E-R-G-Y. Um, or just, yeah, I don't know, just Andy Peat on LinkedIn.

I heard you on— I saw you on LinkedIn. Yeah, I am on LinkedIn.

I'm on LinkedIn. I'm not really on the other things, but LinkedIn's good. Yeah, yeah, cool.

Awesome. Thanks, Andy. Thanks for your time.

Thank you. A pleasure.

Thanks for tuning in, guys, to Industry Change. If you are watching the video version of this, we do have a podcast version. You can subscribe also on our YouTube channel too. Until next time, I'll see you later. Thanks for watching Industry Change.