Across from a Midtown office I sometimes use there are two gyms. One is a meticulously kept “experience,” boasting new equipment and colors “scientifically proven to boost moods”; the other is a bare-bones joint where you pump iron to B-sides from the 80s. There are no classes; you bring your own towel and, if you’re smart, soap. Your “experience” is up to you.
The kicker: they’re two faces of the exact same gym. Blink Fitness, a project of the high-end chain Equinox Fitness, is both a core gym platform that charges a mere $25 a month for the basics, and an upgradable experience for those who choose to spring for a few extras. The Blink franchise, beta-launched in 2011 and now expanding rapidly, brings à la carte to a level Southwest Airlines would envy. Want them to provide your towel? That’ll be $3-5 more, depending on its size and logo placement.
It’s just one more example of companies that are now answering the call from today’s burgeoning gig economy for products and services that are stylish and fun but also cheap and focused—and customizable. Used to working on-demand anywhere and anytime, gig economy freelancers expect the same kind of flexibility and focus from the vendors who provide the picks and shovels of their often-blurred personal and professional lives.
The focus on cheap and stylish core services is challenging the all-inclusive model within the health club industry, and in many others as well. One Blink competitor, Town Sports International’s (CLUB) New York Sports Club (NYSC), used to charge me more than twice Blink’s rate for an all-inclusive corporate membership. Nowadays, they’re offering a $19.95 monthly rate—on a BYO towel basis.
At the same time they are being made to pivot to a core-services-with-extras model, established companies like NYSC are also being challenged by another hallmark of these gig economy pick and shovel providers: style. Like Casper Sleep or Chop’t Creative Salads—two other trending brands that do just one thing well—Blink pledges a healthy product in welcoming, winking terms. (“Blink responsibly,” urges one wall.)
Equinox Fitness is privately held. But there are many public companies in a range of industries that are taking sharp aim at the gig economy culture. The smarter ones are getting it right.
One example is the provider of that office of mine across the street from Blink: Regus, a global co-working chain that provides entry-level members low-cost access that comes with little more than a desk and a cup of coffee. Traded on the London Stock Exchange, the company epitomizes the anywhere/anytime nature of a workforce that travels light. Though priced for growth with a P/E of nearly 29 at 1.8x sales, it’s risen from under £200 ($300) per share a year ago to close at £345 on Friday.
For affordable style, the Blink approach has a long pedigree in retail. Hennes & Mauritz (HNNMY), Fast Retailing’s (FRCOY) Uniqlo, and Target (TGT) all strive to combine fresh looks with fresher pricing. Though each has been buffeted by headwinds in the retail market this past year, Target—a pioneer in faux chic for Gen Xers—looks particularly faded against the nimble global names that have helped define the Millennial aesthetic.
And the ultimate provider of picks and shovels to the gig economy? Apple (AAPL), of course, whose MacBooks and iPhones are the uniform of the white-collar TaskRabbit. Though now an established corporate player, Apple has used its distribution network to address the needs and tastes of today’s flexible workforce.
Freed from AT&T’s (T) exclusivity since 2011, the iPhone has become available on terms that vary widely by carrier. When paired with a flexible network provider, both handset costs and monthly charges can be managed from the day you sign on. That brings us to T-Mobile (TMUS), whose stylish advertising and aggressive pricing appeals to sole proprietors paying their own bills for the first time. Over the past year its stock price has risen from around $29 to more than $38, while AT&T’s has been stuck between $32 and $36.
Is the foreseeable growth already all priced into these gig economy providers? Equinox Fitness clearly doesn’t think so. These days, its subsidiary Blink is focused on growing their footprint: between pitching T-shirts ($12) and ear buds ($6), flat screens by the free weights highlight the franchise opportunity for members.
Yes, with a three-year track record and $500,000 in liquid assets, all this can be yours. Just please, bring a towel to wipe down the bench for the next guy. If you forget it, that’ll be another $3.
