How do you interpret Equinox’s decision to introduce a luxury gym membership priced at $40,000 annually?
Equinox has moved beyond the luxury gym membership and jumped into the deep end of well-being – defined as mental awareness plus physical health – with the added benefit of structuring the actual time, resources, and commitment for holistic wellness into a person’s daily life. At $40,000 a year, Equinox might be providing a bargain to those already spending heavily to attain a longer, healthier life that challenges the current concept of aging.
Just looking at millennials aged 28-44, 61% prioritize mental health, 40% use technology to manage health, and 39% don’t seek medical care because what ails them might improve over time (Mintel Millennials and Health US 2024). Services covered by health insurance – nutritionist, acupuncture, sleep studies, biomarkers, mental health service, physical therapy – are expensive, hard to obtain, difficult to schedule, and often fail to provide lasting change. Once you do the math, including health insurance premiums, deductibles, out-of-network expenses, and co-pays, $40,000 might be a deal.
From a brand strategy standpoint, what motivations might drive Equinox to offer such an exclusive and expensive membership option?
Current and prospective customers of Equinox are keenly aware of aging and are excited by breakthroughs in longevity. As more discoveries on reversing the aging process are published, demand for good physical health, less stress, more mindful living, a sense of belonging, and a longer, productive life have surged. With demand, the market is flooded with technologies, applications, services, providers, and programs, leaving consumers overwhelmed with the paradox of choice. Understandably, consumers want to know what will work for them – what they need to optimize their health and wellness needs and how it can fit into an over-committed life. With the Function Health partnership, Equinox developed a brand strategy that solves these two problems: personalized health and wellness via the biomarkers and a single bundle of services already scheduled into your daily life. Equinox offers consumers a customer experience that makes it easier to incorporate a lifestyle filled with the promise of an aging well. You go to one place and get everything you need specifically for you. Who doesn’t want that?
In your opinion, is Equinox’s move to offer a $40,000 per year membership primarily a brand visibility tactic, or does it serve other strategic objectives?
The health and wellness industry is a fragmented market that, in many respects, is a byproduct of the proliferation of a food industry that has led to record levels of disease and obesity and a healthcare system monitoring the outcome of poor health and not on the prevention of disease. Firms like Equinox have an opportunity to own a piece of the preventative health, wellness, and longevity market specifically for a target segment that can afford the services and time to focus on their health. It is a very strong, strategic position validated by the halo effect of the medical credentials of Functional Health and the popularity of its founder, Dr. Mark Hyman.
Additionally, this model works for Functional Health, which now has a sales, revenue, and distribution channel to support their current clients with services that allow them to act on their findings and recommendations of the lab results.
What message do you believe Equinox is sending about the types of customers they are targeting with this high-priced membership option?
At first glance, overall health and longevity seem like a natural transition from focus on luxury fitness. The marketing message takes the concierge medicine model and applies it to fitness. They even use the word ‘concierge’ to describe the person coordinating services and organizing the Optimize program team. For current and prospective customers, the promise of a customized program deeply attuned to your medical profile is very appealing. Adding a sleep coach and nutritionist offers two new services that could help improve wellness.
There is also an elevated position of ‘fitness.’ The target customer might lose motivation to ‘look good,’’ ‘be fit,’’ or ‘get in shape.’’ Avoiding disease, preventing illness, and aging well is a new lifestyle that is not a temporary training program. It is your new cost of living well. For many people, slowing the aging process does not feel like a luxury—it is a necessity.
However, this ‘concierge’ message is risky and potentially misleading in that there is no definition of the credentials of the Equinox concierge. We must ask how much a fitness trainer might understand about lab results. There are also issues of confidentiality and HIPAA violations if lab results are shared or leaked. There is also the question of a nutritionist, sleep consultant, or trainer interpreting biomarkers for the prevalence of diseases that may or may not become a problem.
How does the introduction of this luxury membership align with Equinox’s existing brand identity and values?
This model makes sense for Equinox – it is an intelligent decision and aligns with their desire to cater to the personal needs of their customers. It is a vital brand extension that integrates fitness into biology and ties biology to aging. This luxury membership consolidates the services a customer spends with other specialists to a single, convenient location and a team focused solely on you. Exclusivity is still a big part of the identity. The Optimize program establishes a new tier that will appeal to those who desire a holistic approach and have the means to pay for it.
What do you think this means for the future of the luxury fitness industry?
Body positivity, mental health, stress management, sleep disorders, gut health, genes, aging, and access to healthy, whole foods and nutritious meals are part of the disruption of the health industry. For luxury fitness brands, this cultural disruption is happening simultaneously as economic conditions create a deeper wealth divide. The number of potential customers who can afford luxury concierge memberships is small — the ‘haves’ who can afford $40,000 a year are the same haves who have generative wealth.
So, Equinox is going for a first-mover advantage, which might provide a very healthy bottom line. However, a holistic approach that allows individuals to be their healthiest selves and ensures they live productive, fulfilling, long lives free of disease is part of the new promise—just not for everyone.