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Denver Business Journal: Massage Business has all the right Elements

Jul 24, 2009

Elements Therapeutic Massage appears to be rubbing some people the right way if the company’s numbers are any indication.

From mid-year 2008 to 2009, the Highlands Ranch-based massage franchise bolstered its number of studios by 25 to 77. In metro Denver alone, five new Elements studios emerged over the last year for a total of 14.

Jeff Jervik, president and CEO of Fitness Together Holdings, the parent company of Elements, said the franchise may surpass 100 studios nationwide by the end of the year. The company also oversees Fitness Together, an established personal training franchise with more than 500 studios around the world.

Jervik estimates that revenues under the Fitness Together umbrella are up 25 percent systemwide from the previous year.

Meanwhile, same-store sales from Elements Massage, which was founded in 2006, are up 15 percent from 2008, he adds.

So, why is Elements doing well in a down economy where massage might be considered an indulgence?

Jervik said it’s because massage is considered more than an indulgence in certain quarters — even an alternative to traditional medicine.

“Much has been written about the medicinal benefits of massage in relieving pain, mental stress, etc.,” Jervik said. “A lot of customers come looking for therapy, but we also provide an indulgence for people who are looking for it. We do a good job of balancing both.”

Leslie Young, vice president of the Associate Bodyworks and Massage Professionals, a Denver-based trade organization that represents 69,000 members, said in general, the franchise model is growing for the massage business.

She cites the success of Massage Envy — the No. 1 massage franchise in the world — as an example. Massage Envy, an Arizona-based company founded in 2002, now has more than 420 locations.

Only seven years ago, Young notes, the idea of franchising massage clinics was controversial within the sector.

“There was a perception that franchises were stealing business from the independents and not paying enough,” Young said.

But in reality, massage franchises have been good for the massage business.

“Franchises do the marketing and detail work so that [massage therapists] can focus on their practice,” she said.

Jervik said Elements is growing because many prospective franchisees are looking for new financial opportunities.

“They want a chance to buy themselves a career and control their own destiny,” he said.

Although Elements is growing, Jervik said some deals have fallen through because prospective franchisees could not secure credit. In general, he estimates it costs about $200,000 to start an Elements franchise.

Jervik, who took over the leadership of Fitness Together Holdings last year after serving in executive roles with Krispy Kreme, PepsiCo Inc. and Papa John’s Pizza, said maintaining trust with franchisees has been key in the company’s success.

Since Jervik took over operations last year, the company has worked on:

  • Improving communication — Jervik said the company put a system in place to regularly communicate with the franchisees and to strengthen franchise relations. That includes monthly newsletters, monthly calls and quarterly meetings with the area directors.
  • Building support — The company hired a new vice president of operations for Elements as well as a chief growth officer for Fitness Together holdings.
  • Building the brand — Jervik said the company conducted consumer research, created a brand advertising campaign and is getting ready to launch a new website next month.

Christina Lenhart, who co-owns an Elements studio in Parker with her husband, said despite the new marketing efforts, referrals remain the most powerful tool in delivering customers.

“People are drawn by the environment and the quality,” Lenhart said. “Even with the economy, we’re still bringing in 500 to 600 customers a month.”

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