Business spotlight: powering the online fitness industry
10 December 2020: The growth of online fitness services and apps is one of the success stories of lockdown. ICAEW Insights speaks to Laurence Hodgkins, a chartered accountant at the heart of one such high-growth app.
Goodbye sweaty changing rooms, hello celebrity trainers, dedicated studio DJs and film-grade production values. While physical gyms are struggling – just 31% of gym members have returned to their gym since lockdowns ended, according to a survey by RunRepeat and 60% of the 5,055 surveyed have cancelled or are considering cancelling their memberships – the fitness app market is booming.
The growth of online fitness services and apps is one of the success stories of the pandemic as the combination of enforced closure of gyms and home working have prompted us to explore alternatives to keeping our fitness on track, limiting weight gain and quite possibly alleviating the boredom of all those Zoom calls.
If you’ve not heard of Fiit yet, it’s probably only a matter of time. Since its launch in April 2018, the number of active users regularly exercising through the app has exploded, with users paying subscriptions of as little as £10 a month in exchange for unlimited access to hundreds of classes and more than 20 personalised training plans designed to help good habits stick.
Laurence Hodgkins ACA is the first qualified accountant employee in the company, although he’d already been working with Fiit in a virtual capacity via online accountancy service The Accountancy Cloud (TAC) for some months – just one of a number of startups in his portfolio of clients. Hodgkins left TAC in February to go travelling with his girlfriend but when COVID put a stop to their plans, the job with Fiit beckoned. He joined as a full-time employee in May.
The startup experience wasn’t new. Hodgkins had already cut his teeth working inhouse for a tech startup – then Midlands-based fintech Merchant Money – after graduating from Swansea University with a degree in economics. “I liked the idea of working in the tech industry. I like innovative companies that are pushing the boundaries.”
Hodgkins trained with PwC in London, and just two years post ACA qualification he is enjoying the excitement of being involved in a booming business with its sights set on global success. Fiit’s growth strategy is underpinned by partnerships to further push out its online fitness platform: a commercial deal with Sky means the app is offered as an add-on to Sky TV subscriptions via its SkyQ box. A barrage of promotional activity and advertising is slated for January. Fiit has a similar deal with Amazon Fire TV and also sells via the App Store, where it boasts the accolade of being the number-one-rated home fitness app.
With COVID restrictions likely to be in place in some form or another until at least March next year, Fiit is keen to strike while demand is hot, although Hodgkins is adamant that restrictions have been in place for long enough for people to form new habits rather than head back to gyms when normality returns. “It’s the convenience of being able to work from home and work out from home. Digital fitness is here to stay.”
In addition to the constant demand for new and exciting content from well-known trainers and its in-house team of five fitness gurus, he admits that being able to recreate some of the community aspects of a gym workout is key to driving app “stickiness”, getting people to use the app regularly and ultimately renew their subscriptions. A partnership with UK gym chain The Gym Group offers a Fiit subscription bolt-on as part of gym membership. The next year or so will see the development of Fiitpods, dedicated spaces in its gyms where people can use Fiit’s app.
The app also introduces a competitive gamification element by ranking willing participants on leaderboards according to their effort based on data from compatible heart rate monitors. “We’re also trying to broaden out our class content to make it more accessible – and starting to stock dumbbells and kettlebells on our Fiit store online so customers can buy the equipment they need to do the classes at home.”
The app is already sold into 150 countries worldwide but that’s not stopping Fiit eyeing up further overseas expansion in 2021. “I’m spending quite a lot of time thinking about how we might approach expansion into new territories including the impact of taxes. We need to think about these kinds of things before we can even consider a launch.”
Hodgkins has also spent much of the past six months building up financial controls and processes, and ensuring they are as efficient and effective as possible. “We have documented accounting policies and procedures in place to make sure we’re holding ourselves accountable and comfortable over every number. Things are in place to be able to report accurately and on a timely basis every month to investors.”
Hodgkins admits the journey to date has been a positive rollercoaster ride and the opportunities for personal development at a relatively early stage of his career definitely tick a box. “I’m still fairly junior but you get a lot of responsibility and breadth quite quickly. I’m really excited about the international expansion. Growing to a group with multiple markets around the world is really exciting.”
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