Friday, June 09, 2006
“I refuse to join any club that would have me as a member.” Groucho Marx
Over the years that I have lived in the Twin Cities of Minnesota I have belonged to the following private social clubs:
Decathlon Athletic Club
Calhoun Beach Club
Minneapolis Athletic Club
Today only two of these five clubs still exist as the traditional private members' clubs complete with oak paneled rooms and social events. While these clubs offered "reciprocal membership privileges" so that we could utilize other such clubs when we were in that area of the city this reciprocal process was tedious to say the least since it required a card of introduction, etc. The problem I would identify is that these clubs focused on retaining their "island" status refusing to move with the changing market conditions in terms of a more mobile population and families with young children looking for fun activities. I always believed that clubs like my beloved Decathlon Club could have survived against the big chain health clubs by essentially merging into one entity that allowed members to use clubs when and where you wanted. For instance, I could play racquetball at the Decathlon Club in Bloomington on a Monday then on Tuesday use the Minnesota Club in St. Paul for a lunch meeting with one seamless membership card and no "reciprocal" paperwork. Not only would such a "one entity" approach have added value for members it would have reduced overall operating costs for these private clubs by eliminating overlapping operations and by aggregating purchases for volume discounts.
I was reminded of my thinking on these clubs this week when I read this article, "Wirth seeks high end hotel at site of Chicago social club", in the Minneapolis/St. Paul Business Journal. Wirth Companies purchased the former Minneapolis Athletic Club (MAC) in 1998 for a mere $4.5 million then spent $50 million to convert it into today's Grand Hotel complete with a Lifetime Athletic Club (one of the nation's largest chain health clubs). The article was focused on Wirth's pursuit of the Chicago Athletic Association -- another piece of prime real estate -- for conversion into another high end hotel. The MAC is a perfect example of how the private members' clubs I love failed to successfully change with market forces since its ambiance started feeling like a nursing home for old, white men -- not a good place to meet women I can assure you :) versus a fun, energetic place to bring your family.
The demise of private members/athletic clubs in the USA is worthy of an MBA case study project to better understand -- changing market conditions/demograhics, marketing, and operational synergies.
Sadly I won't be seeing my friends at our annual gourmet dinner at Decathlon Club since it is gone having been replaced by a water park. Ah, but the memories are treasured!
Enjoy your own club,