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Martial Arts Business Strategies: Thriving in Tough Times

Learn how martial arts schools are adapting to economic challenges and utilizing advertising and social media strategies to attract more students.

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Martial Arts Business Strategies: Thriving in Tough Times

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  1. Trained for Tough Times • The Great Recession dealt martial arts schools a significant blow. Parents who were losing their jobs or were working only part-time had to reduce the number of activities in which their children were participating. • According to data from the Sports & Fitness Industry Association, prior to the Recession, during 2007, there were 6.9 million Americans of all ages participating in martial arts. By 2012, the number of participants had decreased 26%. • As of December 2014, there were more than 8,500 martial arts schools in the US generating $3 billion in annual revenue. From 2009 through 2014, the annual growth rate was 1.2%, and is forecast to grow at a faster rate through 2019.

  2. The Martial Arts Business Model • Most school owners operate a full-time school at a strip-mall location, teaching fewer than 200 students. Many of these owners are more focused on teaching their art than building their businesses. A smaller number of school owners have larger facilities, and with 300, 500 or more students. • The martial arts sales and marketing model is essentially the same as health clubs. With youth classes generating more than 40% of total industry revenue, school owners offer parents and their children a beginner set of classes for 4 or 8 weeks, at either a package price or a per-class price. • As students progress through the belt system, owners attempt to upsell parents on signing longer-term and much larger contracts, so their children can earn a Black Belt. These are typically a small percentage of the original class of students.

  3. More Students on the Mat • According to the Sporting Goods Manufacturers Association’s (SGMA) Manufacturer Sales by Category Report, wholesale sales for martial arts increased 5.8% during 2011, to $417 million, another indication of the revitalization of the industry following the Recession. • While all martial arts experienced a modest 0.8% growth in participation from 2011 to 2012, cardio kickboxing and Tai Chi increased their participation rates 3.7% and 7.7%, respectively. • SGMA’s 2012 study, The Journey of Sports Participation, reported that youth and teens active in martial arts spend approximately $580 per year for event registration, apparel, classes and other costs.

  4. The Influence of Mixed Martial Arts • Mixed martial arts (MMA) gained popularity through 2010, primarily because of the founding of the Ultimate Fighting Championship and its TV contract with Fox. Martial artists and school owners were concerned it emphasized fighting and not the benefits of character development and fitness. • Many school owners, however, recognized the value of adding MMA to their curriculum and many MMA-only facilities opened, catering specifically to young adult males. • During recent years, the TV audience has declined significantly. Pay-per-view events decreased from 9 million viewers during 2010 to 6 million during 2013. Spike TV Channel’s broadcast of Bellator MMA has experienced an average decrease in viewers of 15% from 2010 through 2013.

  5. Advertising Strategies • Show martial arts school owners how well television reaches parents of school-age children. Spots directed at parents should emphasize character development and anti-bullying skills and will be more convincing with testimonials from current parents and students. • Look for the large, “mega” martial arts academies in your SMA, as they are more likely to have the advertising budgets for regular TV flights. They have significant turnover and must attract a constant flow of new prospects to maintain their school size and profitability. • Since many martial arts schools offer after-school programs and summer camps, TV advertising is the perfect method to reach parents who need these programs, so their children are safe and occupied while the parents are working.

  6. Social Media Strategies • Because most consumers are attracted to informational, even educational, content on social media that helps them decide where to spend their money, martial arts school owners have a long list of topics, such as character development and self-defense, about which they can write in a regular blog. • Video is the digital marketing medium for martial arts schools. Children are often sold on participating because they see the fun and excitement that others their age are experiencing. Plus, video testimonials from parents will do more to sell a school than any sales pitch from a school owner. • School owners should encourage students and their parents, who are typically heavy social media users, to share their martial arts experiences, especially photos of students’ graduation ceremonies where they receive their next belt and any offsite activities, such as tournaments.

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