‘Famous but misunderstood’: Inside David Lloyd Clubs’ seven-year marketing-led transformation 

The health and fitness sector is highly competitive, with discounting and cost-cutting among the common levers used by brands.  

However, David Lloyd Clubs has taken a different approach. Instead of racing to the bottom, the business set out in 2016 to “race to the top,” its marketing director since 2017, Andrea Dearden, tells Marketing Week.  

For almost a decade, the business underwent a marketing-led transformation to build its brand strength, increase customer numbers and achieve premiumisation – and position itself as not just an “expensive gym” but a “premium family wellbeing destination”.  

Its work to pursue premiumisation in a low-cost category contributed £137m to its incremental revenue between 2016 and 2023, and helped it clinch bronze at the 2024 IPA Effectiveness Awards.

Brand reinvention

While the brand had strong awareness early in its transformation journey – 80% in 2019 – the marketing team identified a disconnect.  

While awareness was high, understanding of the brand lagged at 43%, while consideration was 31%. It suffered from being “famous but misunderstood”.  

The brand was struggling to communicate its broader lifestyle appeal and benefits to consumers, instead falling into the “limiting” gym category, says Dearden. That David Lloyd is a health, fitness and wellbeing club – not just a gym – was something the marketing team needed to convey.  

Faced with these challenges, the leadership team, appointed in 2016 following the business’s acquisition in 2013, decided to push further into premiumisation, rather than following the rulebook used by high street gyms in the UK.  

It meant investing “significant” money into club renovations and the introduction of different membership tiers to convince customers.  

The value equation for customers “is related to dwell”, says Dearden, who says people often approach fitness as something “they have to do” and then finish, whereas at David Lloyd “because we’re bringing people together” they can stay for longer on each visit, bring their families and purchase food and drink.  

Resetting brand and performance

Marketers have long debated the benefits and pitfalls of brand marketing versus performance marketing.  

For Dearden’s team, the objective was to develop a strong brand-response model, but there was an acceptance that this takes time.  

Therefore, the business decided to first up focus on setting the foundations of “efficient” short-term acquisition activity before flexing on brand.  

Ahead of tackling longer-term brand challenges of understanding and consideration, the team set its data and performance foundation in four areas: linear attribution and a performance-driven media plan to build confidence in mass-reach channels, data planning at club level and audience penetration to target efforts to lower performing clubs, share of voice analysis to inform budgeting, and econometrics for each individual club.  

The marketing team has a “test and learn” approach, says Dearden, drawing inspiration from the US and Canada rather than the UK, because health and fitness brands in these regions “tend to be quite innovative in the fitness space”.  

Like many businesses, David Lloyd “had a lot of data”, says Dearden, “but a lot of the data wasn’t quite as usable as maybe it should be”.  

“We spent an awful lot of time trying to understand [data] and that has manifested itself in building media mix modelling (MMM), which allows us to understand, certainly from an acquisition perspective, which channels are working for us,” explains Dearden.  Focus on marketing effectiveness in decline, study shows

Each club has its own “mini MMM” which ladders up to the overall model. It allows for easier comparison between clubs, she explains. “You can go to Acton Park in West London, what kind of elements of media drive that audience, which is very different from somewhere like Hull, which is one of our more cost-effective clubs.” Plus, it allows the business to optimise regional spend and national media investments “dynamically”.  

“The role of data has increased massively. As has the role of creative because we need to be saying the right thing to the right person at the right time, and so we track all of that as well,” she adds.  

David Lloyd has been with the same media agency for seven years, she adds, meaning there’s a “wealth of data” her team can interrogate at any time. “It massively helps with forecasting,” she notes.  

Dearden has “always been a real proponent of integrated campaigns” where all elements of the mix “work together”. It’s changed “a lot” in seven years at David Lloyd, she says, with content development in digital channels growing significantly, as customer data has developed too.  

“The big focuses are obviously data-driven decisions based on much better data and making sense of what we’re actually seeing,” she adds.  

Clear on audience

None of this means the brand isn’t focused on brand building and what Dearden describes as “richer” storytelling though.  

David Lloyd’s storytelling seven years ago was “quite functional,” she says. Now, it’s more “emotive”, particularly for the moving image format, which “works better” for the business – in part because its industry is movement-based so the products can be highlighted better.  

“We’re very clear about who our audiences are and making sure we focus on the right kind of people, but interestingly, we use TV as a broad brand message,” says Dearden. “Then we target very specifically within a drive time of each of the clubs.”Brand building ‘most important’ factor in achieving business objectives

Since undergoing its marketing transformation, acquisition costs have “quite significantly” lowered, she says, because its strategy is “about driving brand consideration”.  

“We used to do a lot more offers,” says Dearden. Indeed, when she joined the business, there were “an awful lot more offers through the sales team”. 

“Today, we keep away from it,” she says. “We’ve managed to shift from being very offer-led, which the gym industry is, to while we might have limited offers at very limited times, we’ve managed to wean ourselves off.”  

Covid and cost of living

Undergoing a marketing-led business transformation is hard at the best of time – let alone when it encompasses the Covid pandemic and subsequent cost of living crisis.  

While its customers tend to be more affluent, David Lloyd recognised all consumers were cutting back on discretionary spending. The business therefore needed “to work even harder to justify value”.  

In justifying its proposition, the business led with a new brand platform, ‘Elevate your Everyday’, to position the brand as an integral part of life rather than a nice-to-have. While its creative approach was focused on growing brand metrics, the media strategy “flipped” the focus back to acquisition.  

David Lloyd “recovered quickly” after the pandemic, says Dearden. It thought recovery would happen by the end of 2021, but the business considered itself recovered by August. “That was because we were relentlessly focused on what the consumer was going through,” she explains.  

The business also benefitted from the rise in wellness trends post-pandemic, she acknowledges, which have “massively exacerbated” since 2020.  

Marketing-led growth

David Lloyd is not always “the early innovator”, says Dearden, but within its overall brand proposition, there’s always “an element of innovation”.  

The business will look at emerging trends and ask how they can be applied to it.

“We’re not necessarily always the first to market – but this business will go to market effectively,” she says.  

Between 2016 and 2023 the business achieved growth by both volume and value by achieving its short and long-term objectives, according to its IPA Effectiveness Awards Bronze-winning case study. In this period, the share of premium memberships (Diamond and Platinum) grew from 10% to 61%, contributing strongly to revenue growth. ‘We are beginning to turn some corners’: Is ROI still king in marketing?

Its total annual enquiries grew 66%, while consumer understanding that it is “more of a club than a gym” grew from 44% to 59%.  

In terms of consideration, the belief that the clubs are “worth the higher price”, increased from 32% to 39%.  

While David Lloyd is “still perceived to be expensive”, consumers recognise its range of services with a sense its worth paying for, according to the brand’s research. Between December 2016 and December 2023, member count grew from 430,000 to 609,000 – despite a significant drop in the pandemic. 

Putting marketing at the heart of the business helped it achieve growth and transformation – and helped it to achieve its ideal premiumisation.  

“When you walk through the door, there’s so much more to it,” says Dearden, “and it’s so much more than just a gym.”