Case 5: CrossFit at the Crossroads
CASE
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CrossFit at the Crossroads
“I’m not trying to grow a business . . . I’m doing the right things for the right people for the right reasons”
-Greg Glassman, Owner of CrossFit, Inc. [3]
It’s a pleasant July morning in Carson, California, in 2016 as Greg Glassman, the founder of CrossFit, Inc. makes his way across the Stubhub Center turf and sits down on one of the black Rogue plyoboxes that line the back perimeter of the stadium. He gazes out past the ongoing rows of boxes, connected rigs, and zigzag sprint course to see the sun starting to rise over the grandstand can- opy. Just 15 hours earlier those grandstands were filled with thousands of passionate screaming fans cheering on the final contestants of the 2016 Reebok CrossFit Games. A slight grin appears across his face as he lets out a faint but subtle chuckle to himself, almost as if he can’t believe that he has built the fitness industry’s fastest-growing brand.
The tenth consecutive CrossFit Games, the larg-
est CrossFit sporting event in the world, was now over and Glassman started to reflect back on how quickly his creation has risen in just a few decades. In 1995, he was a personal trainer looking for a place to train his loyal clientele after being kicked out of yet another commercial gym because management did not approve of his unorthodox training methods, and now, he is a multi-millionaire who owns one the largest brands in the fitness industry. That unorthodox training method, well, it is now one of the most popular fitness workouts in the world and is arguably becoming one of the fastest grow- ing sports of all time. Everything has happened so fast, he thought to himself while watching the cleanup crew start to tear down the event setup, we barely even have a concrete business plan, he jokes but deep down inside he knows that it is true. CrossFit has evolved so rapidly that Glassman and his relatively small but fiercely loyal employees have been forced to make important company decisions on the go. Evident by CrossFit’s unprecedented growth, those decisions have more often than not been correct but with little time to reflect on the company’s aim and future, how could he be fully confident in the
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direction his company was heading and what does the future hold for a fitness company operating in an ever changing, potentially fad-like industry?
As Glassman got up to leave the stadium to catch the quick flight back to the Silicon Valley in the company jet, he decided he was going to disrupt his normal rou- tine and take a few days off to think. His plan is to use this time to genuinely reflect on where his company has come and how the business has reached elite status as one of the largest fitness brands in the world. What can CrossFit, Inc. do to improve, what new trends can they capitalize on, where is the future of the company and sport going, and how can they avoid that dark irrelevant fate where so many fitness startup companies eventually end up?
History of Crossfit
Greg Glassman
Greg Glassman, born on July 22, 1956 to a rocket scien- tist father and a stay at home mother, was raised in the Los Angeles, CA suburb of Woodland Hills. Around the age of one, Glassman was diagnosed with Polio, a dis- ease that affects the nerves in a person’s spine and affects muscle movement. Growing up though, Glassman did not let this disease define who he was as he turned to sports such as gymnastics, cycling, and weightlifting to counteract his inability to participate in contact sports. His aptitude on the pull up bar along with having pow- erful upper body strength led him to excel at the rings in gymnastics, but a freak injury on a routine dismount in high school left him with a permanent limp and unable to compete. Glassman subsequently turned to coaching, a decision that would eventually define who he is and create a legacy most people only dream of.
Glassman refers to himself as a “rabid libertarian,”
[1] a term defined as “an advocate of the doctrine of free- will.” [2] In high school, Glassman habitually read and studied the theories of Milton Friedman, an American economist who wrote such books as ‘Capitalism and Freedom’ and the 50th anniversary edition rewrite
This case was written by Andrew Callaghan and Dr. Charles B. Shrader of Iowa State University, July 2016. It is intended to be used as a basis for classroom discussion rather than as a demonstration of either effective or ineffective management of a situation. The case reflects the views of the authors and not the exact thoughts and opinions of CrossFit, Inc. management. Part of the information in this case is derived from the authors’ personal experiences with the case company. Some of the opening and closing managerial situations included in the case are fictional and are for illustrative purposes only.
of F.A. Hayek’s ‘The Road to Serfdom.’ It’s here where Glassman’s management theories would form the basis of his future business model, or lack there-of. At age 18, Glassman took a job as a gymnastics coach at the YWCA in Pasadena, CA. Little did he know at the time, this being his first real coaching gig, that it would eventu- ally be his calling in life. He attended college but never graduated, stating “I went to a half dozen institutions, but I was just there for the girls.” [3] His passion was fitness training and throughout the late 1970s and ‘80s he worked as a personal trainer. His commitment, knowl- edge, and extremely brash personality attracted people to enlist his services in the Silicon Valley area, but it was also his unique and unconventional methods toward fit- ness that allowed him to lure in not only the computer tech leaders and local service workers but also celebrities and professional athletes alike.
Results are what ultimately define success and
Glassman knew how to attain them, but his methods were unusual and his workouts were seen as in your face and bordering on intimidating. So intimidating to the average gym goer in fact that he had been kicked out of seven or more commercial gyms as a result. Glassman’s attitude toward fitness can be described as confident and assertive with firm beliefs, but that con- fidence can also be interpreted as defiant and arrogant. In a 60 Minutes episode, when asked if he doesn’t like to be told what to do, Glassman responded with a chuckle and said “Oh, I don’t mind being told what to do . . . I just won’t do it.” [4] But that is who Greg Glassman is and that defiance is why he now owns 100% of the fastest growing fitness program and emerging sport in the world, CrossFit.
The Beginning
In the late 1980s and early ‘90s, Glassman tinkered with his workouts and found success with his clients by com- bining High Intensity Training (HIT) with heavy fun- damental movements and sprints. His workouts were loud, intense, and demanding but also successful and his client base started to expand. In 1995, after being asked to leave what would be his last commercial gym, Glassman decided to open his own training facility in Santa Cruz, CA. CrossFit (at the time Cross-Fit) was born. Glassman had a goal in mind to establish a fitness program that would not only motivate participants to exercise but also to constantly work toward achieving a high level of fit- ness. [5] At the time, Glassman was still training clients solo, but after he started to become overbooked he soon realized that he could train multiple people together and
still provide a safe environment as well as the required attention to each participant to be effective. With that he would also be able to increase his profits by charging a reduced rate to each member but add more members to each session. [6] Glassman found that his clients enjoyed the idea of group fitness, and after he was hired to train the Santa Cruz Police Department, the idea of “The CrossFit Community” was formed.
In 2000, CrossFit, Inc. was legally established by Glassman and his (now ex) wife Lauren. When prompted by his oft-traveling clients to build a website and post workouts of the day (WOD), so that they could train on the road, Crossfit.com was created. In 2002, the first CrossFit affiliate was started in Seattle, WA (CrossFit North) by former Navy Seal Dave Werner and part- ners Robb Wolf and Nick Nibler. In the same year, the CrossFit Journal was published in which Glassman wrote three seminal articles explaining CrossFit’s principles and theories, titled “What is Fitness?”, “Foundations,” and “The Garage Gym.”
Crossfit Philosophy
What is Fitness? (According to CrossFit, Inc.) One of CrossFit’s first newsletter articles [7] set out to explain the company philosophy by questioning previously proposed definitions of what it meant to be truly fit. The article challenged the notions of Merriam-Webster, Outside Magazine (“Fittest Man on Earth”), and the industry leading National Strength and Conditioning Association (NSCA), by conclud- ing that their definitions were either too broad or too narrow. The CrossFit article concluded that previous attempts to define fitness were inadequate. Glassman, however, defined fitness through a meaningful and measurable way as “increased work capacity across broad time and modal domains,” [8] where broad time means “length of duration of effort” and modal domains “variety of activity.” [9] In the What is Fitness? article, Glassman defines three standards/models that they use for evaluating and guiding fitness. Together they outline CrossFit’s view of fitness as 1) ten general physical skills widely defined by physiologists, 2) per- formance of athletic tasks, and 3) energy systems that drive all human action (Exhibit 1). CrossFit’s aim is not to specialize in one certain task of fitness but to be a “jack of all trades.” The article states, “Our specialty is not specializing. Combat, survival, many sports and life reward this kind of fitness, and on average punish the specialist.”
Exhibit 1 CrossFit’s 3 Standard Principles
- 10 recognized General Physical Skills:
– If your goal is optimum physical competence, then all general physical skills must be considered:
- Cardiovascular endurance/Respiratory endurance – The ability of body systems to gather, process, and deliver oxygen
- Stamina – The ability of body systems to process, deliver, store, and utilize energy
- Strength – The ability of a muscular unit or combination of muscular units to apply force
- Flexibility – The ability to maximize the range of motion at a given joint
- Power – The ability of a muscular unit or combination of muscular units to apply maximum force in minimum time
- Speed – The ability to minimize the time cycle of a repeated movement
- Coordination – The ability to combine several distinct movement patterns into a singular distinct movement
- Agility – The ability to minimize transition time from one movement pattern to another
- Balance – The ability to control the placement of the body’s center of gravity in relation to its support base
- Accuracy – The ability to control movement in a given direction or at a given intensity
- The essence of this view is that fitness is about performing well at any and every task imaginable. Picture a hopper loaded with an infinite number of physical challenges where no selective mechanism is operative, and being asked to perform feats randomly drawn from the hopper. This model suggests that your fitness can be measured by your capacity to perform well at these tasks in relation to other individuals.
The implication here is that fitness requires an ability to perform well at all tasks, even unfamiliar tasks, tasks combined in infinitely varying combinations. In practice this encourages the athlete to disinvest in any set notions of sets, rest periods, reps, exercises, order of exercises, routines, periodization, etc. Nature frequently provides largely unforeseeable challenges; train for that by striving to keep the training stimulus broad and constantly varied.
- Three metabolic pathways that provide the energy for all human action
- Phosphagen Pathway – Dominates the highest powered activities (10 seconds or less)
- Glycolytic Pathway – Dominates moderate powered activities (up to several minutes)
- Oxidative Pathway – Dominates low-powered activities (excess of several minutes)
Total Fitness 5 The fitness that CrossFit promotes and develops requires competency and training in each of these three pathways or engines.
Source: Glassman, Greg. “What is Fitness?” The CrossFit Journal (October 2002): 1–4. Web.
Foundations
The Foundations article presented CrossFit’s approach to generalized comprehensive fitness and away from the traditional workouts of isolation movements and extended aerobic sessions that the majority of the population participates in. [10] CrossFit works with “compound (functional) movements and shorter high intensity cardiovascular sessions” because they believe that the two theories combined are “radically more effective at eliciting nearly any desired fitness result” than any other form of fitness. The CrossFit workout can be universal as the movements and weights can be scaled to fit any participant, or “athlete,” as CrossFit’s members are called. Outsiders are often amazed that CrossFit athletes range from professional athletes and military special ops to the elderly and handicapped and everyone in-between. In the “60 Minutes” episode, when Glassman was asked if he would have a 75-year- old doing deadlifts his answer is simply, “Uh huh, yeah, to say no is to say that if you drop your pen on the ground, you’re not going to pick it up. It’s a deadlift, it’s picking something up off the ground. It does not
require a physician’s ‘Ok.’ If your physician doesn’t think you should deadlift, you need to get a new doctor.”
The Garage Gym
Glassman also strongly believed that the equipment in a typical gym was useless. In simple terms he believed a gym should resemble a barn or garage. It should be open and uncluttered, and the equipment should require the use of muscle in the most natural fitness sense. CrossFit boxes were basic and austere. Modern gyms had fancy weight machines focused on isolation work. CrossFit, on the other hand, tried to develop overall fitness and con- ditioning as a philosophy. The whole thing was oriented toward a natural and more primitive approach to basic conditioning.
Glassman is such a firm believer in his methodology that he strongly believes that between diet and exercise, CrossFit can even be a solution to chronic diseases. The Centers for Disease Control and Prevention (CDC) has identified lack of exercise, poor nutrition, tobacco use, and high alcohol intake as health risks that contribute toward many of the illnesses and early deaths related
to chronic diseases. Glassman advocates that CrossFit targets two of those four conditions which are normally prescribed with prescription drugs (high blood pressure) or steroids (low muscle mass), “the problem is being inactive and poor nutrition. It’s a lifestyle issue.” [1]
The CrossFit Journal, or newsletter, became an
important means for the company to disseminate Glassman’s philosophy. Newsletters were published on a monthly basis and included articles dealing with box operations, fitness training, and lifestyle. For example, the August 2014 CrossFit Journal contained a story about how affiliate owners compensate coaches and trainers. The story offered ideas on how to go beyond simple financial incentives to motivate coaches and trainers. Motivational ideas included: equal pay for both affiliate owners and trainers, enhanced education and certification programs for trainers, specialty pro- grams for members, and building long-term relation- ships with trainers. Examples and success stories from CrossFit centers in California, New England, and New Zealand were shared. The goal of the newsletter was to offer affiliate owners and trainers alike ideas on how to make each box more capable in terms of enhancing fitness and changing lives. [48]
Workout Methodology and Structure CrossFit workouts are based on constantly varied func- tional movements (real-life movements) that incorporate a mix of aspects from gymnastics, weightlifting, and car- dio all while being performed at relatively high intensity (Exhibit 2—list of exercises). The workouts are typically
Exhibit 2 List of CrossFit Exercises
performed in a gym, or “garage gym” because of the rough appearance and similarities to at-home stripped down style gyms, that the CrossFit community refers to as a “box” and which includes an array of weights, racks, boxes, bands, and balls but is void of commer- cial style machines (Exhibit 3—list of equipment). The workouts are roughly 60 minutes in length and typically include four phases: Warm-up/Stretch, Skill Development Segment (SDS), WOD, and an Individual or Group Stretch (Exhibit 4). The SDS focuses on Olympic type lifts or calisthenics (bodyweight move- ments), and the WOD generally contain a combination
Exhibit 3 List of Equipment
Weightlifting | Gymnastics | Cardio/ Calisthenics |
| Squat Racks/Rig System | Pull-up Stations/ Rigs | Medicine Balls |
| Bumper Plates | Rings | Bands |
| Barbells | Ropes | PVC Pipes |
| Dumbbells | Hand Chalk | Ab Mats |
| Kettlebells | Rowers | |
| Sand bags | Boxes | |
| Dip Belts | Hurdles | |
| Steel Plates | Jump Ropes | |
| Large Tires | Foam Rollers | |
| Push Sleds |
Exhibit 4 Daily Workout Example
Weightlifting | Gymnastics | Cardio/ Calisthenics |
| Deadlifts | Bar Muscle Up | Air Squats |
| Front & Back Squats | Rings Muscle Up | Box Jumps |
| Power Clean | Dips | Jump Rope |
| Hang Clean | Strict Pull Up | Rowing |
| Sumo Deadlift High Pull | Kipping Pull Up | Wall Ball |
| Snatch | Sprints | |
| Overhead Squat | Jogging | |
| Push Jerk | Jumping Jacks | |
| Push Press | Sit Ups | |
| Shoulder Press | Push Ups | |
| Thruster | ||
| Tire Flip |
of all movements performed in high-intensity bouts that can last anywhere from 4 to 24 minutes long depend- ing on that day’s goals. The workouts are designed to arouse an athlete’s competitive nature not only within themselves but also with the other competitors. Times and repetitions are recorded on either large white- boards or computer systems, which then rank the athlete’s performances.
The CrossFit philosophy that workouts should be repeatable and measurable is the basis for self- improvement. The “Benchmark Workouts” were origi- nally named after “girls,” so that the athletes could easily identify the unified workout, and have grown to include Hero WOD in honor of fallen military, law enforcement, and firefighters (Exhibit 5). The intent of the Benchmark workouts is for athletes to perform them periodically, say
Exhibit 5 “Girl” WODs
| “Amanda” | “Diane” | “Jackie” | “Nicole” |
| 9-7-5 | Deadlift 225 lbs | 1000 meter row | Run 400 meters |
| Muscle Up | Handstand push-ups | Thruster 45 lbs (50 reps) | Max rep Pull-ups |
| Squat Snatch (135/95) | 21-15-9 reps, for time | Pull-ups (30 reps) | As many rounds as possible in 20 minutes |
| “Angie” | “Elizabeth” | “Karen” | “Cindy” |
| 100 Pull-ups | Clean 135 lbs | Wall-ball 150 shots | 5 Pull-ups |
| 100 Push-ups | Ring Dips | (men 20#-10’ – women 14#-9’) | 10 Push-ups |
| 100 Sit-ups | 21-15-9 reps, for time | For time | 15 Squats |
| 100 Squats | As many rounds as possible in 20 min | ||
| “Annie” | “Eva” | “Kelly” | “Helen” |
| Double-unders | Run 800 meters | Run 400 meters | 400 meter run |
| Sit-ups | 2 pood KB swing, 30 reps | 30 box jump, 24 inch box | 1.5 pood Kettlebell swing 3 21 |
| 50-40-30-20 and 10 rep rounds; for time | 30 pullups | 30 Wall ball shots, 20 pound ball | Pull-ups 12 reps |
| 3 rounds for time | |||
| “Barbara” | “Fran” | “Linda” | “Nancy” |
| 20 Pull-ups | 21-15-9 reps, for time | Deadlift 1 1/2 BW | 400 meter run |
| 30 Push-ups | Thruster 95 lbs | Bench BW | Overhead squat 95 lbs 3 15 |
| 40 Sit-ups | Pull-ups | Clean 3/4 BW | 5 rounds for time |
| 50 Squats | 10/9/8/7/6/5/4/3/2/1 rep | 5 rounds for time | |
| “Chelsea” | “Grace” | “Lynne” | |
| 5 Pull-ups | Clean and Jerk 135 lbs | Bodyweight bench press | |
| 10 Push-ups | 30 reps for time | pullups | |
| 15 Squats | 5 rounds for max reps. . | ||
| Each min on the min for 30 min | |||
| “Christine” | “Isabel” | “Mary” | |
| 3 rounds for time | Snatch 135 pounds | 5 Handstand push-ups | |
| 500 m row | 30 reps for time | 10 1-legged squats | |
| 12 Body Weight Dead Lift | 15 Pull-ups | ||
| 21 Box Jumps | As many rounds as possible in 20 min |
continued
Exhibit 5 (cont.) “HERO” WODs
| JT | Michael | Badger | Nate |
| 21-15-9 reps, for time | 3 rounds for time | 3 rounds for time | As many rounds as possible in 20 min |
| Handstand push-ups | Run 800 meters | 95 pound Squat clean, 30 reps | 22 Muscle-ups |
| Ring dips | 50 Back Ext | 30 Pull-ups | 4 Handstand Push-ups |
| Push-ups | 50 Sit-ups | Run 800 meters | 8 2-Pood Kettlebell swings |
| Daniel | Murph | Josh | Jason |
| 50 Pull-ups | For Time | For time | 100 Squats |
| 400 meter run | 1 mile Run | 95 pound Overhead squat, 21 reps | 5 Muscle-ups |
| 95 pound Thruster, 21 reps | 100 Pull-ups | 42 Pull-ups | 75 Squats |
| 800 meter run | 200 Push-ups | 95 pound Overhead squat, 15 reps | 10 Muscle-ups |
| 95 pound Thruster, 21 reps | 300 Squats | 30 Pull-ups | 50 Squats |
| 400 meter run | 1 mile Run | 95 pound Overhead squat, 9 reps | 15 Muscle-ups 25 Squats |
| 50 Pull-ups | 18 Pull-ups | 20 Muscle-ups |
*For a Complete List log onto https://crossfitiota.com/bench-marks/hero-wods/
a few times per year, and compare scores to track their overall fitness progress. Glassman presented his theory in the September 2003 CrossFit Journal article in which he introduced the “girls”: “only by repeating workouts can we confidently measure our progress.” [11]
The CrossFit Diet
Greg Glassman’s regular response when asked about what CrossFit can do for a person is that it can deliver you to your “genetic potential.” “Look at her! That’s what nature would have carved from her a million years ago” was Glassman’s reaction after seeing one of his well- toned athletes working out, but it is not just the workout that CrossFitters are encouraged to practice. [4] They are also urged to follow one of a few specific diets that, based on personal goals, will provide CrossFit members with increased energy, optimized health and will reduce the risk of chronic diseases. The seemingly most widely used diet is the Paleo Diet which is based on every day, modern type foods that “mimic the food groups of human’s pre-agricultural, hunter-gatherer ancestors.”
[12] In Glassman’s World Class Fitness in 100 Words [7]
statement, he provides some CrossFit diet advice: “eat meat and vegetables, nuts and seeds, some fruit, little starch and no sugar. Keep intake to levels that will sup- port exercise but not body fat.” The Paleo Diet generally fits these criteria as its directions suggest people con- sume high protein, lower carbs, high fiber, and moderate
fat intake (Exhibit 6—Paleo Diet food options). While a few of CrossFit’s top athletes have confessed about not following a strict diet to a ‘T’ [13], it’s made quite obvious that following one of the suggested diet options while participating in CrossFit is recommended and will posi- tively affect the athlete no matter if they are beginners or top flight competitors.
Some CrossFit diet followers have become celeb- rities and authors in their own right. A good example is Christmas Abbott, author of the Badass Body Diet.
[46] This diet combines healthy eating guidelines with high-intensity workout plans for individual body types. Following this plan, athletes at all levels can set personal goals for developing toned cores and reducing body fat. Ms. Abbott also has infused an element of fun into each workout—noting that people tend to stay with a workout plan longer if the workout is enjoyable.
Business
CrossFit, Inc. is 100% privately owned by Greg Glassman—an ownership situation that totally fits his style. In 2012, CrossFit began business as a 50/50 part- nership between Glassman and his ex-wife. At that time, because of a contentious situation, Glassman’s ex-wife’s share was almost sold to Anthos Capital, an investment firm looking to invest in one of America’s fastest grow- ing brands. In the 11th hour though, Glassman was able
Exhibit 6 Paleo Diet Foods
| Do’s:Meats | Seafood | Veggies | Oils/Fats | Nuts | Fruits |
| Poultry | Shrimp | Asparagus | Coconut Oil | Almonds | Apples |
| Pork | Lobster | Avocado | Olive Oil | Cashews | Berries |
| Pork Chops | Clams | Brussel Sprouts | Macadamia Oil | Hazelnuts | Peaches |
| Steak | Salmon | Carrots | Avocado Oil | Pecans | Plums |
| Veal | Tuna | Spinach | Grass-fed Butter | Sunflower Seeds | Mango |
| Bacon | Shark | Celery | Grapes | ||
| Ground Beef | Tilapia | Broccoli | Lemon | ||
| Venison | Trout | Peppers | Lime | ||
| Buffalo | Walleye | Cabbage | Oranges | ||
| Bison | Crab | Zucchini | Bananas | ||
| Jerky | Scallops | ||||
| Oyster | |||||
| Don’t’s:Dairy | Grains | Legumes | Snacks | ||
| Cheese | Cereal | Beans | Pretzels | ||
| Non-fat Creamer | Pasta | Peas | Chips | ||
| Butter | Bread | Peanuts | Cookies | ||
| Milk | English Muffin | Peanut Butter | Pastries | ||
| Yogurt/Pudding | Sandwiches | TOFU | Hot Dogs | ||
| Crackers | Mesquite | Fries | |||
| Oatmeal | Miso | Artificial Sweeteners | |||
| Corn | Soybeans | Pop/Soda | |||
| Pancakes | Fruit Juices | ||||
| Hash Browns | Energy Drinks | ||||
| Beer |
*These are an option list/not exact. Please see source for more information. Source: http://ultimatepaleoguide.com/paleo-diet-food-list/
to secure a matching loan through Summit Partners (Boston) for $16,093,000 and put a halt to the potential sale. [14] With Glassman in full control, he could operate the company autonomously, without input from outside corporate investors.
CrossFit, Inc. does not have to answer to sharehold- ers or a board of directors. The headquarters, which han- dles the business operations, is located in Washington,
D.C. and the Media Office, the lifeblood of CrossFit’s day-to-day technology operations, is based out of Silicon Valley. CrossFit’s model resembles its owner’s libertarian beliefs, as the growth of the company has come directly
from its affiliation program that permits individuals to own and operate their own box while using the CrossFit name and allows them to run their business with inde- pendence and autonomy.
Affiliation
CrossFit-affiliated boxes started in 2002 with the CrossFit North opening and have spread like wildfire through- out the world. To open a box, essentially all one has to do is fill out an application, pay $3,000 per year, attend a 2-day seminar detailing the business and the work- out methodology, and pass a test to become a Level 1
instructor ($1000). When confronted about the seem- ingly easy nature of this process, CrossFit’s fearless lead- er’s response was:
“Amazing huh?… Here’s how it used to be: all you had to do was have the money. . . and you don’t even have to take a test. That’s where every other chain came from, someone just launched ‘em.” [4]
CrossFit box owners have the freedom to manage their box in their best interests so that they can cater to the local demographic. To Glassman, his main con- cern is not about what hours the affiliate owners are operating, the location in which they choose to open their business, or the music that is played; his only concern is that they follow CrossFit’s physiology and methodology. [1] Each affiliate is locked into their orig- inal annual fee in case the fee is ever raised. In fact, there are affiliates, who got in early, that still pay only
$500 per year.
CrossFit, Inc. created CrossFit RRG (Risk Retention Group), which is a captive stock insurance company that allows American affiliates to purchase specific CrossFit general liability and professional liability policies designed to cover the unusual risks boxes are susceptible to. [15] CF-RRG is a form of self-insurance where the affiliate owners purchase stock and become shareholders (1-time fee of $1,000). Box owners who buy into the group are involved in the underwriting, risk management, claims administration, and financial committees. [16] Boxes earning less than $125,000 per year pay a yearly premium of $1,185 with boxes that earn greater than $125,000 per year paying an extra
$8.70 per $1,000 of gross revenue earned. Affiliations
are urged to purchase insurance from CF-RRG rather than an outside vendor because CrossFit endures unique circumstances that most liability policies may not thoroughly cover. Owning this specialized policy, box owners are eliminating the possibility of omis- sions and will have the most comprehensive cover- age available. International CrossFit boxes are insured through somewhat similar companies such as the CrossFit International Insurance Programme, which is run through Lloyd’s of London and covers box owners in the UK. [17]
Growth
Glassman admits that when he started CrossFit he did not have a business plan, that his goal was simply “being committed not to screw it up,” and that he has
stuck by that plan ever since. [18] The numbers, though, would suggest otherwise. In 2016, a little over a decade and a half since CrossFit, Inc. was formed, Glassman’s corporation has become one of the fastest growing fit- ness companies of all time. With roughly 13,000 gyms in 142 different countries, CrossFit, Inc. rakes in close to
$100 million and the CrossFit brand’s estimated ecosys- tem is approximately in the $4 billion range (2016). [18] The scary part? The company is still growing. “I don’t know how you compete against me” said Glassman in an interview with CNBC.
CrossFit, Inc. brings in most of its profits from two main sources: 1) affiliates and 2) CrossFit Training Certification courses. But even with CrossFit’s rapidly growing business it is hard to look anywhere else but the core concepts that have brought them to this point: technology and having a loyal group dynamic culture that has adopted CrossFit as more than a workout but a way of life. CrossFit is a technology company. It started with Glassman posting workouts, journal articles, and an easy-to-use blog onto www.crossfit.com. Since then, the company’s success has followed the growth of the Internet. One ten-minute browsing session on their web- site and you can find CrossFit’s mission, workout meth- odology, limitless instructional videos, workouts of the day, nutritional ideas, gym locations, and much, much more, all for FREE. Yes, for free! When asked about the financial implications of giving away free content and how that makes sense in today’s capitalistic economy, Glassman replied “it didn’t until we did it, the more video we give away, the more money we make.” [4] The all exposure is good exposure philosophy has assembled one of the largest viral communities in the world and when combined with their devout and enthusiastic alle- giance toward the brand, largely explains why CrossFit, Inc. has been able to grow at the record-breaking pace it has.
The Community
CrossFit is much more than just a fitness regimen—it has evolved into a distinctive community within itself where its followers are amazingly loyal and dedicated. For many, CrossFit has become a way of life. CrossFit affiliates have been extraordinarily successful in cre- ating an atmosphere where its members feel a sense of belonging which motivates them to come back day after day and push themselves harder, whether that’s to beat the person next to them or just to improve from their previous scores. The CrossFit Community members have taken a leading role in marketing the
CrossFit brand. They have created an almost obses- sive-like adoration for CrossFit to the point where they actively promote the sport through any outlet possible. It has prompted outsiders to joke that “the first rule of CrossFit is that you never stop talking about CrossFit,” parodying a line from the Brad Pitt movie, Fight Club.
[19] Whether box members are viewed as loyal, fanatic, annoying, or crazy one thing for certain is that their dedication to spreading the brand, whether intention- ally or unintentionally, has been an exceptionally lucra- tive model for CrossFit, Inc.
Glassman insists that he has not recruited one person to CrossFit. To him CrossFit has an open door policy and anyone who wants to join is welcomed to do so. [4] Through tremendous leadership and coaching, CrossFit has been able to provide an atmosphere where its mem- bers seek to live their lives in a state of optimal health and fitness in a time where health and fitness are becom- ing less of a priority. [5] The members work out together multiple times per week often creating a team-like bond. This type of interaction, uniting by a common goal or interest, is similar to the family-like atmosphere most sports or military teams have. The CrossFit Community is also able to attract members through their group vol- unteer and charitable.
American sociologist Ray Oldenburg introduced
the idea of a “Third Place” for healthy human existence.
[20] He believed that humans must live in a balance of three realms: 1) Home/Family Life, 2) Work Life— where people spend most of their time, and 3) a Third Place—inclusively sociable places. Third Places are described as “anchors” of community life and facilitate & foster broader, more creative social interaction. One of the main characteristics of Third Places is that they act as a “leveler,” which means they place no impor- tance on an individual’s status in society and allows for a sense of commonality between members. They are highly accessible places, where friendships develop that fill the human need for “intimacy and affiliation.” In what used to be the traditional Third Place, church, studies have shown that the new generation of millen- nials have been leaving the religious life behind, [21] thus creating a void in many people’s lives. The CrossFit Community, through its affiliates, have been able to provide that Third Place for many of its members. The box offers its athletes a place where they can build those social relationships and have a sense of “place.” In turn, its members adopt the CrossFit lifestyle as one of their main identities and that which becomes a part of who they are. This could explain why they “always
talk about CrossFit” or post CrossFit related content to social media outlets. CrossFit, in a (smaller) sense, is as much a part of many of its members’ lives as say their families, therefore creating that automatic impulse to constantly want to talk or interact with other about their CrossFit lives, the same as they would about their children or significant others.
In a 2014 CrossFit demographic study, the data did illustrate that the millennial generation had the highest level of participants but not by as much as many would think. They only comprised 40% of participants while the 35–44 age group consisted of 20% with the under 18’s covering 18%. [22] Along with the age demographic they found that CrossFit is evenly split 50/50 between female and male participants thus attesting to the fact that the CrossFit workout is feasible at any age, male or female.
Technology and Social Media
The shift toward social media outlets becoming a primary form of contact in today’s society has vastly affected the field of communication, marketing work and advertising. Gone are the days where the major- ity of adults actually dial someone’s number up and speak to them over the phone as social media has increased the ability and frequency in which people can “checkup” on one another in a much less personal way. In a 2014 social media study, it was found that 52% of online adults now use at least two forms of social media sites and the numbers showed that usage of young adults (18–29 y/o) on Instagram, just one form of social media, was around 53%. [23] The CrossFit Community is no stranger to this as the basis of their growth can be attributed to increased action on the Internet and social media sites from its members.
When CrossFit, Inc. launched its first blog system,
which allowed box owners to communicate not only with headquarters, the media team, and other affiliates at the click of a mouse but also with their own clientele, they created an easy medium where information could be shared at a faster pace and to a larger audience. Just because Glassman himself has not recruited anyone over social media that does not mean his loyal follow- ers have not. The Internet communication concept has spread to more common and interactive uses of social media (YouTube, Facebook, Twitter, Instagram, etc.) now within specific box communities as a way to mass market their new and exciting fitness program with outsiders. Since the mid-2000s box owners and community members have hit the social media world
running and are no strangers to posting pictures, videos, or workout statuses from their experiences or the CrossFit world. Social media is an incredibly accessible and cost- effective way to reach a wide audience in little time, and the more community members post the more CrossFit’s ecosystem grows. It’s a multiplier effect that spreads the CrossFit brand like wildfire. A 2012 study on Internet usage found that 23% of U.S. Internet users under the age of 35 said they would buy a brand because of a friend’s social endorsement, such as a “like” on Facebook. [24] This is a growing trend in the capitalistic technological world we live in, and for businesses looking to grow it is almost a must that they use social media as a market- ing outlet.
Although many of the CrossFit customers who
actively post personal information on social media understand the logic or intent of spreading “the word” about CrossFit, often times they are also engaging in a form of self-promotion. As adults, people start to have fewer tangible goals they can point to and share as a source of pride. Their high school accolades have lost social value and their current work accomplishments usually do not translate well to social media. CrossFit fills that void and allows members to take pride in their accomplishments, whether it is losing weight, hitting a new personal record, or even simply proving that they have gotten off the couch and are participating in an intense workout. [25] A 2014 sociological study [26] on “trophies of surplus enjoyment” (photo’s, merchandise, trinkets, etc.) found that people hunt for trophies at events they attend not just for their fandom and remem- brance but also as envy-inducing commodities they can share on social media so that others can acknowledge them through “likes,” “favorites,” and “retweets.” This is often what CrossFit community members are doing when posting photos and videos to social media. The pictures or videos of them participating in CrossFit act as “acquired trophies” so that others can socially recog- nize their efforts and potentially elevate their “status” in the viewer’s eyes.
The CrossFit Community’s indulgence in social
media, evidenced by the rapid success of CrossFit as a sport and a brand, further proves that their presence in the technological and social media world has been a surefire benefit. The CrossFit Community as a whole understands the value of social media, and whether their intentions are of the conscious or unconscious nature, they use this medium to pique the interest of outsiders about as well as anybody.
The CrossFit Games
From the very first journal article introducing CrossFit to a larger scale, Greg Glassman has challenged the idea of who is the “fittest on earth.” The CrossFit philosophy of defining fitness through meaningful and measurable ways opened up a door for competition to exist. Enter, The CrossFit Games, which have been held annually since 2007 and continue to grow at record numbers each year. The games are a physically and mentally demand- ing competition held over a few days where competitors are blind to the certain events until right before they participate. At the end, the overall winners are awarded the title “Fittest on Earth.”
The first games in 2007, held on CrossFit Games
Director Dave Castro’s parents’ land in California, consisted of first-come participation with the win- ner receiving a $500 prize. Popularity grew with The Games as the company grew and in 2011 The CrossFit Games hit a banner year as CrossFit, Inc. signed Reebok to a 10-year title sponsorship as well as having the games broadcasted through ESPN3 (online). [27] With the rising number of participants yearly, CrossFit adopted an online qualification format that included three stages. Stage 1, known as ‘The Open,’ occurs in March when contestants submit weekly scores online from recently released competition workouts from crossfit.com. The scores are validated through affiliates, or video is uploaded proving participants score times. The top qualifiers from pre-determined regions will participate in Stage 2, regional events, held throughout the world in order to qualify for Stage 3, The CrossFit Games. In 2011, online participation totaled 26,000 sub- missions and has grown exponentially as 2016 online submissions totaled 308,000 people, a CrossFit Games record. [28]
With Reebok and ESPN on board, The CrossFit
Games are now considered a top flight fitness compe- tition and are broadcast worldwide live on ESPN. The winners in 2016 will receive $275,000 and the total prize pool, paid from the Reebok contract, is $2,200,000 and will rise annually throughout the length of the contract (Exhibit 7). Even though The CrossFit Games are not a large profit source for CrossFit, Inc. the magnitude of what The Games brings to the company is immeasur- able. The exposure of the competition alone is one of the driving forces in making CrossFit the number one fitness enterprise on the planet and looking at the yearly increase in participants, prize money and attendance, The Games momentum does not appear to be slowing down.
Exhibit 7 The CrossFit Games History Data
| Participant DataYear # of Participants | ||
| 2007 | 60 (no open) | Games |
| 2008 | 300 (cap – no open) | Games |
| 2009 | 146 (post regionals) | Games |
| 2010 | 86 (post regionals) | Games |
| 2011 | 26,0001 | Open |
| 2012 | 69,240 | Open |
| 2013 | 138,0001 | Open |
| 2014 | 209,0001 | Open |
| 2015 | 273,0001 | Open |
| 2016 | 308,0001 | Open |
Year | Participant Data (Open)Winner Total Prize Purse | Sponsor | |
| 2007 | $500 | $1,000 | |
| 2008 | $1,500 | $3,000 | |
| 2009 | $5,000 | $10,000 | |
| 2010 | $25,000 | $50,000 | Progenex |
| 2011 | $250,000 | $1,000,000 | Reebok |
| 2012 | $250,000 | ? | Reebok |
| 2013 | $275,000 | ? | Reebok |
| 2014 | $275,000 | $1,750,000 | Reebok |
| 2015 | $275,000 | $2,000,000 | Reebok |
| 2016 | $275,000 | $2,200,000 | Reebok |
| 2017 | ? | $2,400,000 | Reebok |
| 2018 | ? | $2,600,000 | Reebok |
| 2019 | ? | $2,800,000 | Reebok |
| 2020 | ? | $3,000,000 | Reebok |
*Spaces with ‘?’ mean we were unable to find accurate numbers.
Sources: http://www.everylastrep.com/fitness-for-beginners/look-crossfit-games-history http://games.crossfit.com/content/history
Industry Competition
At the beginning of 2016 there were numerous fitness centers competing in a growing national and global mar- ket. Primary activities for this industry included operat- ing health clubs, gyms, aerobic and exercise centers, and other fitness-related facilities. The industry was frag- mented with many companies that were growing and
combining across regional and product lines. Demand for fitness and recreation centers continued to increase thereby causing the number of people employed in the industry to increase. By 2015 there were almost 33,000 fit- ness centers in the United States. The industry employed approximately 568,000 people that same year. [29] In 2016, the overall industry had grown to $27.1 billion in reve- nue and $2.8 billion in profits. Membership fees were the
single largest revenue component and member retention was the key to a center’s profitability. Fitness centers com- peted on brand recognition, customer service, price, and services offered. [47]
Even though competition was great, industry entry barriers were considered to be low. It was possible to lease equipment and buildings and both equipment and buildings had long life spans. Many start-ups were able to use second hand or previously used equipment. Wages were low. There were not many regulations other than zoning and building permit processes at the local levels. Access to capital for start-ups was readily available in most instances. The only real entry barrier was the brand loyalty and recognition built up by established gyms and fitness centers. Fitness center memberships were on the rise. However, in the future, it was expected that entry barriers would rise due to the possibility that corpo- rate wellness programs would create strong demand for large-scale memberships, thereby creating barriers for newer companies. [47]
Yet even with all this activity in the business of fitness
there was evidence that additional growth was possible. A 2016 study of nine countries by Censuswide, a global consultancy, found that the average person spent only 0.7% of their life exercising—or stated differently, out of an average person’s 25,915 days on earth, they tend to spend only 180 days exercising. [30] However, the num- ber of adults aged 20 to 64 spending leisure times exer- cising and on sports was increasing. Plus, the number of employers viewing exercise as an important component of employee health was also on the rise. Therefore, in the minds of many these findings established the need for increased emphasis on global fitness. The view of indus- try experts was that there was plenty of room for growth for both large companies and niche players (See Exhibit 8 for possible fitness niches). The industry was expected to grow, in terms of industry value added (IVA- a measure of the industry’s contribution to the economy overall) by approximately 3% from 2016 to 2021. [47]
CrossFit competed in this industry with a unique
value proposition that was more a philosophy of fitness than a business model. It appealed strongly to the largest market segment—consumers aged 34 years and younger.
[47] Still, other companies thrived in the industry as well. Among the industry leaders were Anytime Fitness, Arcadia Fitness, Gold’s Gym, GoodLife Fitness, LA Fitness, Planet Fitness, 24 Hour Fitness and Zumba. LA Fitness and Planet Fitness were publicly traded companies while most other competitors were private or closely held firms. Each company sought large-scale expansion while at the same time targeting particular segments for growth.
Anytime Fitness. As the name implies, Anytime Fitness operates fitness centers that are open for workouts twenty-four hours a day 365 days a year. Anytime Fitness, with more than 3 million members, was one of the fastest-growing and most progressive fitness businesses in the world. It received notoriety as one of Entrepreneur Magazine’s top 10 fastest-growing franchises across all industries in 2015. From its first center in 2002 it grew into all fifty states and twenty countries with 38 wholly owned and approximately 3,000 franchised centers worldwide in 2016. For example, they opened a fit- ness center in Rome in 2016. The co-founder Chuck Runyon, used private equity and franchising to finance the company’s rapid growth. Also to facilitate growth, in 2016 it moved into a new building and expanded to 300 employees at its headquarters in Woodbury, Minnesota. Runyon expected to continue growing the company at a rate of approximately 400 franchisees annually toward of goal of 4,500 centers by 2020. Starting a franchise cost between $100,000 and 500,000 plus a $30–37,500 fran- chise fee. Anytime required franchise owners to pay a
$549 monthly royalty. In 2017, the parent company of
Anytime Fitness, Self Esteem Brands, was diversifying into salons and other fitness-related businesses. [31]
Arcadia and GoodLife. With more than 365 operat- ing fitness centers, GoodLife Fitness was the largest fit- ness company in Canada. Members could join for around
Exhibit 8 Top 20 Worldwide Fitness Trends for 2017
Source: Worldwide Survey of Fitness Trends for 2017 by Walter R. Thompson, PhD., ACSM’s Health & Fitness Journal, November/December 2016
$50 a month and specific classes were available for an additional fee. TRX suspension training classes were the most popular starting at $199 for six weeks. These classes kept members involved through a progressive training structure—each new class building upon what members learned in previous classes. Many GoodLife centers were oriented toward women’s fitness. GoodLife provided individual trainers as well as individualized workout sessions for class members in order to mesh with mem- ber work schedules. Another Canadian fitness company, Arcadia, specialized in fitness programs for women taught by women that emphasized the use of gravity and body weight as resistance. Arcadia and GoodLife occu- pied some of the same competitive space in a growing market. The Canadian fitness industry generated over
$2 billion in revenue and was growing at an annual rate of
over two per cent. Approximately five million Canadian citizens were members of fitness clubs in 2012. [32,33]
LA Fitness. This company began in 1984 in Covina, in Southern California. It mission is to provide lifelong good health benefits to an increasingly diverse member- ship base. The business model was to tailor each individ- ual fitness center to the specific needs of the community into which the company expanded. LA Fitness viewed its competence as being able to understand and meet the dis- tinctive needs of the metropolitan communities in which they operated. They offered workouts and programs to people of all ages and fitness levels. The company strove to be family-friendly. Growth goals for LA Fitness centered on the idea of making fitness more available to larger seg- ments of the community. It offered access to free weights, weight machines, and cardio to members. [34]
Planet Fitness. Planet Fitness was also a large and fast-growing competitor in this industry. In 2015, it maintained over 1,100 spacious and clean facilities (most of these were franchises) in 47 states with a large selec- tion of Planet-Fitness branded equipment. Their slogan is: ‘We’re not a gym. We’re Planet Fitness.’ Typical cen- ters were 20,000 square feet filled with purple and yel- low cardio and weight-training equipment of all types. Memberships were inexpensive relative to other centers and Planet Fitness offered unlimited fitness instruction to all members. Their goal was to appeal to a broad mar- ket by creating a welcoming and non-intimidating,‘judg- ment-free,’ fitness environment for anyone. Company revenue for 2015 was $1.5 billion and it had aggressive plans that included growing equipment sales, expanding franchise royalties, driving revenue growth, and growing into a broad range of markets. Planet Fitness planned to
increase the number of stores in the United States to over 4,000 and to grow into Canada in the near future. [35]
Gold’s Gym. Gold’s Gym considered itself the orig- inal fitness company. Founded by Joe Gold in Venice, California in 1965 it gained notoriety in the documentary movie Pumping Iron starring two young weight-lifting sensations Arnold Schwarzenegger and Lou Ferrigno. Gold’s had over 3 million members in 22 countries and 38 states in 2016. It offered weight-training primarily but also cycling, martial arts, muscle endurance, Yoga, and Zumba. However, it was strength training that set Gold’s apart from other centers. The company claimed to be able to enhance the strength of members, with the additional claim that with physical strength came strength to excel at other aspects of life. Gold’s Gym was privately held. [36]
24 Hour Fitness. 24 Hour Fitness competed in a mar- ket space similar to Anytime Fitness and Planet Fitness. 24 Hour operated 400 centers for four million members in seventeen states. The company had run successfully for over thirty years offering convenience to its mem- bers. It had accessible, affordable, convenient places for people of all fitness levels and abilities. Its business model was oriented toward allowing each individual to seek out his or her own fitness goals and pursue them on their own terms. [37]
Zumba. Zumba began operations in 2001. By 2016 it had grown to almost 200,000 centers or locations worldwide. The basic idea of Zumba fitness was to burn calories through dance-related aerobic routines. Zumba centers or classes were found in churches, hospitals, schools, and universities. Almost any room large enough with a good sound system would suffice as a Zumba center. The company also aggressively sold Zumba workouts on CD. The main goal was to provide a non-threatening atmosphere where participants could dance and have fun. Zumba tended to appeal to moth- ers because they could work out at home. Company executive also claimed that people tended to stay with Zumba longer than other competitors because it was fun. Zumba sold itself as being ‘fitnesstainment.’ [38]
Criticism
The growth of CrossFit is undeniable and the future of the company and sport is still as bright as ever, but CrossFit like most fitness industry startups is facing a certain degree of criticism and skepticism. Throughout the first decade and a half, CrossFit has faced an array of
naysayers who criticize CrossFit’s methods, techniques, safety measures, and legitimacy. The following are a few of CrossFit’s most common criticisms:
Cult. One of the most widely mentioned criticisms of the CrossFit industry is that it is a “cult.” Doubters of CrossFit feel that the family-oriented atmosphere that CrossFit revolves around resembles that of a cult-like following. Typical arguments insist that CrossFit brain- washes its members with their workout effectiveness, paying large membership fees (generally around $100/ month), to being led by a ‘leader’ who dictates how they should act, to being elitists who only socialize with other CrossFit members.
Injury/Safety. Outsiders have often claimed that the CrossFit workout can be unsafe for its participants. The intensity and competitive nature can lead to too much heavy lifting and improper form all the way through the rep sets opening up opportunities for injury. The most commonly mentioned injury/disease used against CrossFit is rhabdomyolysis. Shortened in the CrossFit world to “rhabdo,” this is caused by the death of muscle fibers and the release of their contents into the blood stream. [29] Rhabdo results from overexertion, which leads to the body’s muscles breaking down and poten- tially causing kidney failure. Although it can be deadly, it is usually a treatable disease.
Legitimacy. Many proponents of CrossFit argue that the workout methods do not produce realistic results— that the libertarian methods of allowing box owners to create their own workouts within an entire methodol- ogy opens up the risk for unqualified coaches to piece together workouts that are not safe and do not translate into results. [30] High Intensity Interval Training (HIIT) is widely considered one of the best forms of exercise to burn fat, and CrossFit is no stranger to utilizing this method. But many feel CrossFit fails at this in their mix of intensity versus volume. Some contend that CrossFit uses HIIT as a fitness test and not necessarily for the best results. For example, a widely used HIIT method is TABATA (named for Japanese Scientist Dr. Izumi Tabata), which uses eight rounds of one exercise (bike, sprints, etc.) that includes 20 seconds of all-out work and 10 seconds of rest. CrossFit has a workout called ‘TABATA THIS’ in which athletes complete rows, air squats, pull ups, push ups, and sit ups . . . for 40 intervals! Critics say that this far exceeds the accepted mix and exposes participants to a decrease in intensity because of the large volume as well as a breakdown in technique,
which both can lead to less effective and more dangerous results. [31]
Saturating the Market. While most of CrossFit’s crit- icism comes from outside the community, there are affil- iate owners who have concerns regarding the rapid pace at which CrossFit has grown. One box owner who has seen the rise of CrossFit through increased usage of social media pointed out that “growth doesn’t equate to quality.” He wonders if the rapid growth is just inflating a trend or if CrossFit will become a permanent fitness fixture. [32]
While many business owners are reluctant to respond to public criticism for fear that it will damage their repu- tation, CrossFit, Inc. and their legion of followers are the exact opposite. CrossFit has a team of employees who patrol the Internet looking to defend the brand with an iron fist against anyone and everyone who tries to deface it. Glassman has an entire team of lawyers dedicated only to defending the brand name as well as its trademark from people around the world who attempt to use the CrossFit name without paying for it. When asked why, Glassman explains, “if you don’t defend it, you won’t have a brand for long. We are in shark-infested waters and I’ve got shark-repellant attorneys.” [4]
What Next?
After a few days of relaxation, reflection, and thought, Glassman came to the confirmation that he was content as to where CrossFit was, both the brand and the work- out. He understood that he is one of the fortunate ones to break through the “fad” stage in the fitness industry and is truly on the verge of creating not just a revolu- tionary workout but an entirely new sport, and he did it his way. With that thought though, he knows that there are future decisions that must be made to allow the brand to continue to grow and some of those decisions could conflict with CrossFit’s current culture, values, and philosophies.
Sticking to CrossFit’s roots as a technology leverag-
ing fitness company, he thought about the future, how they can continue to stay on the cutting edge of technol- ogy and what avenues would be beneficial to continue to grow the CrossFit brand. Now that CrossFit, Inc. is in a place of financial stability, he also kicked around the idea of starting to get involved in large outside advertising to increase the brand’s recognition and reach, such as sta- dium naming rights and national television advertising. Would the opportunity to increase his brand awareness through mainstream advertising, a path that CrossFit typically has not followed, help or hurt the loyalty aspect
of his devout followers, and what would the impact be at the local affiliate network?
The sport of CrossFit is undoubtedly growing. The Reebok CrossFit Games are increasing each year in par- ticipants, attendance, and revenue. His firm belief that CrossFit athletes are the “fittest on earth” due to their well-rounded abilities is something that he would ada- mantly defend anywhere. With the Rio 2016 Olympic games approaching, he cannot help but dream about CrossFit being an event in future Olympics. The expo- sure of CrossFit, at the largest stage of worldwide competition, has the capability to solidify CrossFit as a major sporting event, not to mention the potential financial impact. The ability for CrossFit’s dedicated athletes to have the opportunity to compete for their countries would be incredible, Glassman thought. But, for this ever to happen, he knows that drastic changes would have to take place. First off, in addition to the International Olympic Committee (IOC), an interna- tional governing body would be needed to oversee the sport [33], undoubtedly limiting his power as CrossFit’s sole decision maker. Policies and regulations would be altered and CrossFit staples such as the random nature of events that the CrossFit Games are known for, amongst others, would most likely change. Is this something that he, personally, is willing to do to grow the sport? Can the sport of CrossFit survive and grow on its own? What would the impact be at the national and local levels with the radical changes that would likely occur?
Glassman’s thoughts then reverted to CrossFit, Inc.’s
affiliate business model and how current trends could impact the company’s growth. How could they address some of the criticism surrounding CrossFit and how would potential remedies impact the company finan- cially? For example, should CrossFit, Inc. mandate con- tinuing education for coaches and do they charge for this, or do they go in the opposite direction and invest in their coaches, in an attempt to increase the com- petency at each affiliate? Lastly, his attention turned to how he should handle the issue of large corporate CrossFit gyms, such as Boston’s Reebok CrossFit Back Bay, who operate full-service, state-of-the-art boxes.
[34] Since the beginning, the “Garage Gym,” a stripped
down, rather unsightly facility with only the essential equipment needed for a hard-core workout, has been the standard. Allowing corporate companies to open “globo-gym” type facilities with full service amenities such as locker rooms and all hours’ access could change the landscape of CrossFit affiliations as they currently exist. Even if these facilities stay true to CrossFit’s roots (equipment, loud music, etc.), what would the effects be
on the local affiliates’ ability to survive? Would there be a ‘Walmart-Effect’ [35] and if so, should they increase the corporate-sized gyms’ yearly fee to offset the loss of small affiliates? Would this be detrimental to the CrossFit phi- losophy or would it further legitimize CrossFit as a high end fitness option?
As Glassman sat at his desk wondering how these opportunities and potential changes would affect the CrossFit world, he leaned back in his chair and scanned the room looking at all of the pictures, posters, and plaques hanging on his wall. Each one represented some- thing different but all of them contributed to the growth of CrossFit in their own way. Then he noticed one in par- ticular. It was a small 8 3 10 frame, somewhat lost among the other flashy pieces, but it carried more meaning than anything up there. It was a photo of him and the offi- cers from the Santa Cruz Police Department, the original CrossFit group. He realizes that changes are inevitable, but the photo reminds him that CrossFit grew from the dedication, commitment, and loyalty of its community. Moving forward he would like his decisions to remain true to those roots and his libertarian approach, because that is the essence of his success.
Exhibit 9 Eight Things You Probably Didn’t Know about Crossfit
Source: http://www.interesticle.com/fitness-and-health/8-things-you
-probably-didnt-know-about-crossfit
Exhibit 10 CrossFit, Inc. Growth Contributors
Exhibit 11 Worldwide CrossFit Box Locations Map
Source: https://map.crossfit.com/
Case 5: CrossFit at the Crossroads C-79
NOTES
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