Flexing muscles
A multi-billion dollar Italian company focuses not just on high-end fitness equipment, but on delivering nifty tech solutions to your everyday workout. Technogym’s founder and president, Nerio Alessandri, talks exclusively to Gulf Business on his vision f
It would be almost entirely inaccurate to call Apple a ‘smartphone company’ or Microsoft a ‘software company’ or even Netflix as a ‘content hosting company’. While it is true that each of those functions occupy a large part of what they do, they have also developed entire ecosystems around their respective business models that account for much more than merely those core functions.
That’s what 58-year-old Nerio Alessandri has strived to do with his fitness and wellness company Technogym – the maker of highend fitness equipment – setting it up as a company that doesn’t just produce and sell exercise equipment, but one that offers holistic technology-driven fitness solutions built around the business of wellness.
With a presence in over 100 countries, there’s a strong chance that you’ve trained on Technogym’s equipment which includes the entire gamut from treadmills and bikes to rowing machines and free weights.
Technogym today is a $2.4bn company listed on the Milan Stock Exchange with revenues of around $595m in 2019, and one that began in a private home garage in Italy. “I founded the company in 1983 when I was 22-years-old. I was very passionate about sports and I had an engineering degree. So, Technogym was born by combining my two passions, technology – “techno” – and gymnastics – “gym”. I come from very humble origins. We didn’t have much money to invest and so I started out by building the first pieces of equipment in my home garage,” says Alessandri.
Back in the early Eighties though, going to the gym mainly revolved around bodybuilding. Alessandri wanted to shift that narrative. “Wellness as we know it today didn’t exist back then. It was only [about] bodybuilding with some dumbbells and rudimentary equipment. My idea was to apply technology to fitness and sport in order to develop equipment, which was not only functional for exercise, but also equipment which was beautiful from a design standpoint and easy for people to use.”
As a self-funded operation at the very beginning, Alessandri would take half the money from clients upfront when commissioned to build equipment and half when delivery was completed. While Alessandri efficiently and sustainably scaled the business over two decades, he didn’t accept private equity until around 12 years ago, before listing on the Milan Stock Exchange more recently in 2016 to raise further money for the company’s expansion plans.
In 2012, he set up a new sprawling headquarters, the Technogym Village, in Cesena, Italy, not far from Bologna. The facility was described as a ‘Wellness Campus’ dedicated to R&D, interior design, wellness culture and physical activity.
But nearly a decade before that in 2003, Alessandri began to take a personal interest in lifting the wellness levels of not just his company, but an entire district in Italy. Through his non-profit Wellness Foundation, he set up the “Romagna-Wellness Valley” initiative that has been promoting and supporting fitness programmes among public and private stakeholders to create what it calls ‘the first wellness and quality of life district in the world.’
The programme has had measurable success over the last 17 years. Reportedly, in Romagna, only 13 per cent of the population is sedentary compared to a national average of 28 per cent. In the region, 40 per cent of the doctors prescribe physical activity as a medicine, as compared to the national average of 30 per cent in other parts of the country.
However, apart from its equipment manufacturing and wellness initiatives, technology has played a central role in the company’s business model.
Technogym began integrating software into its equipment as early as 1996. By 2003, it integrated a TV screen into fitness equipment for the very first time, taking those pieces of equipment online by 2007 and introducing its cloud platform in 2012 – another first in the fitness industry.
Technogym’s Mywellness is an open platform present on all its equipment consoles and also connects with third-party players including Apple Health and Samsung Health. There are believed to be 10 million users globally of its Mywellness platforms that are connected to 15,000 wellness facilities across the world.
The Mywellness platform is connected to a cloud platform that allows users to log in their personalized fitness data directly via the console of the equipment they are training on and then store that data on the cloud which can be downloaded to any of its machines anywhere in the world.
“We call Technogym an Apple-like model. Of course, they do it with mobile phones, we do it with fitness. We call our offerings the Technogym ecosystem, meaning that our equipment is connected online. So people can connect on any Technogym equipment to their personalised training programmes and training data via our Mywellness cloud platform at home or at their hotels if they are travelling, or at their local fitness club, or even outdoors thanks to the mobile app which is fully integrated in the Mywellness cloud platform.”
Apart from the cloud, Technogym is set to go one step further and create live and on-demand exercise and training sessions for its users. “Technogym Live is the sort of Netflix of fitness. It is our enormous content platform that allows people to get access from our equipment console to training classes and videos from the best trainers in the world – on demand or live. So using Technogym Live you can select your favourite spinning class and join it from wherever in the world you are from your hotel or home,” explains Alessandri. Technogym supplies equipment to 65,000 fitness centres across the world. Its equipment is also present in over 300,000 private homes globally. “More than 50 million people train with Technogym every day all over the world,” says Alessandri.
To facilitate its global distribution, Technogym has 14 branches around the world including one in the UAE. “We started developing our distribution in the Middle East over 15 years ago by selecting proven distributors in Saudi Arabia, UAE, Kuwait and Oman. Around 10 years ago, we decided to set up Technogym Emirates in the UAE to serve as a hub for us in the Middle East, which is a key hospitality market.”
The goal of these branches, explains Alessandri, is to go beyond working as distribution channels and instead supplying total wellness solutions and added value services such as design, visual merchandising, education in training for fitness clubs and even corporate wellness programmes.
“Corporate wellness is a big trend internationally. Companies understand that taking care of their employees’ health and wellness is also a return on their business because people who feel well are also more productive and more creative.”
While on a global level Technogym has worked with several mega corporate clients including Ferrari and Maserati in Italy and Salesforce, here in the UAE, the Technogym Emirates division has provided solutions to large conglomerates including ADNOC, Emirates Global Aluminum and du.
The regional team has also provided equipment to residential compounds like Al Barari in Dubai, to universities like the Abu Dhabi University and American University in Sharjah and a number of top-tier hotels in the UAE including Burj Al Arab, Bulgari, Kempinski and the Ritz Carlton in Abu Dhabi.
Alessandri is keen to give the corporate wellness initiatives an even bigger platform by partnering with major global business forums. “I’m part of a very important initiative of the World Economic Forum in Davos to support and to promote workplace wellness as an opportunity for companies to be socially responsible and take care of their employees’ health to have a positive impact on their business.”
Commenting on its global operations, Alessandri says that Europe is the company’s biggest market at the moment, although it’s seen rapid growth recently in North America, Far East Asia, Middle East and Africa.
With the coronavirus pandemic sweeping across the world, it is difficult to imagine that any business will remain unscathed. Technogym has over 2,000 employees globally. “At the moment we are focused on the safety of our employees. We have put in place all the prevention measures indicated by governments in different countries. We are producing and delivering around the world. It is too soon to say what the impact of it [coronavirus] will be on the business.”
There is a silver lining from the pandemic though, as Alessandri explains that the company is experiencing a higher request for home-fitness equipment due to the fact that people tend to stay more at home as a result of the lockdowns being implemented around the world.
Alessandri and his team have another major event though to focus their attention on for the moment.
They have been selected to be the official equipment suppliers to the 2020 Tokyo Olympics in Japan. The company will equip 30 training centres in Tokyo and supply around 1,200 pieces of equipment to the approximately 15,000 athletes who will participate in the Olympic and Paralympic games this year.
“Technogym has a very strong and established relationship with the Olympics. For 20 years, the Olympics has chosen Technogym as the official supplier for training the athletes because of the levels of innovation and safety of our equipment. Also, thanks to our international footprint, athletes tend to be very familiar with our equipment.”
But the decision to partner with the Olympics is also a mutually beneficial one where Technogym gets to showcase its latest equipment to the world’s best athletes. “For us, the Olympic Games are very important in terms of innovation because by working with the athletes we get a lot of feedback and insights to innovate our products. And on the other side, it is also a great opportunity to develop globally our brand in terms of marketing and communication.”
It’s too early to talk succession plans as Alessandri hasn’t indicated he is stepping down from his role as president of the company any time soon. His family remains the majority shareholder though he is keen to reiterate that there is a “very strong governance system and management in place.”
In a year that comes with its own set of unique challenges owing to the Covid-19 crisis, Alessandri strikes an optimistic note, “The guideline we share with the market and with shareholders is profitable and sustainable growth throughout the year.”
“Companies understand that taking care of their employees’ health and wellness is also a return on their business because people who feel well are also more productive and creative”