Don’t Be Everything To Everyone

We’ve been running ads for a while at our agency and are well into the millions on ad spend.

One of the golden rules we use when targeting potential customers for clients is that you shouldn’t be everything to everyone.

I forgot this rule when advertising for Rugby Bricks.

We’ve been looking for new clubs to sign up and buy their uniforms and training gear through us.

The people with the most influence in the club's buying decisions are listed in this order: Board Member, Club Manager, Coach, Player, Supporter.

We ran two ad campaigns to target these people - here are the responses:

Campaign A:

Campaign B:

Campaign A brought us more of the customers we wanted, and it was due to one tweak—we called out the customers we wanted.

Campaign A Ad Copy:

Campaign B Ad Copy:

I know the sample sizes differ, but the videos in the ads were the same.

Addressing the people you want to talk to rather than everyone makes it easier to get what you want.

Life punishes the vague wish and rewards the specific ask.

How To Play Business Poker

At different times of our gym's life we've added features that've produced outsized returns.

In 2017 it was no-contract memberships.

In 2018 it was going 24/7.

In 2019 it was getting lifting platforms.

last year it was a 40m astroturf track.

We're talking 20x+ ROI's on the cost of adding these features.

For the gym-goer-readers, none of these "features" are exceptional, in hindsight they're just "well duh" changes. But for our market, for brief moments (<12 months) these features were ahead of their time. They were waves in demand we saw coming and jumped on early.

For those of you pushing new boundaries all together, the Rocketlabs and Halters of this world perhaps this insight isn't helpful. But for the rest of us, operating in siloed versions of broader markets - we can look at what's taking hold elsewhere and make educated bets on it happening here.

I'm certainly not unique in doing this, many many kiwi companies have been built off the back of looking what's happening elsewhere and bringing it here.

But what's more interesting is when not to pull the trigger. Sometimes there are waves that should be left alone.

For instance, everyone, not just gym'ers saw the small group fitness chains, the F45's, Bodyfits etc.. coming. Demand for this aerobics 2.0 training exploded overseas in the late 2010's before heading here.

We were running a reasonably successful small group training program at the time called Tribe, it was 30+% of our revenue. But at the end of 2022 we shut it down. I got lucky because due to other factors I was forced to make this decision earlier than I otherwise would have. But it was one I knew we were going to have to make.

As high as demand was the barriers to entry were equally and oppositely low. I could see there was going to be a flood of new entrants to the market and regardless of demand, supply was going to beat it.

In the 2 years since, many of these new entrants have come and gone. And of the remaining folk, apart from Les Mills, everyone else is struggling.

Now you could argue the same point for going 24/7, lifting platforms and so on. Everyone does it and has them now. But these were one-off costs with immediate payback periods. Being a group fitness operator is an ongoing commitment that would have left us high and dry with staff, licensing fee contracts, specialised equipment and a structurally unsustainable business once our margins were competed away.

The difference is in making tactical bets vs strategic bets. Low risk bets, that are easy to reverse vs high risk bets that are hard to reverse.

A new flavour, a new colourway some extra chairs and tables out front of the cafe are tactical, low risk, no-harm-done-if-it-fails bets, worth entertaining.

Going from an Ecommerce business to a retailer, is a high-risk hard to reverse bet.

The payoff to make one of the later bets should significantly exceed the former to be worth attempting and that means cashflow contribution by the way, not revenue growth or otherwise.