Claudia Salem has more in common with Zumba Fitness CEO Alberto Perlman than with most of her fellow Zumba entrepreneurs.
Like Perlman, Salem has an M.B.A. and a strategic vision. And she views Z Club NY, her own little bit of Zumba, as a growth business.
"We're already thinking, How do we set up a franchising model around Z Club?" says Salem. "We have to be really clear about what business we are in. We are in the business of coordinating the uncoordinated."
Z Club NY expects to produce revenue of $350,000 next year, which puts it near the pinnacle of Zumba businesses. Salem started the company in 2010 with her own favorite instructor, Edmee Cherdieu D'Alexis. D'Alexis was group fitness manager at the Sports Club/LA in Manhattan when Zumba launched its New York City program there. She has since trained many of the city's most talented instructors.
D'Alexis sought Salem's advice about starting her own Zumba studio. Salem, a vice president at AIG, helped D'Alexis with the business plan, then decided to join her. She put up $100,000, which allowed D'Alexis to quit her job and rent space in two locations. Now in six spaces, the company holds 40 to 50 classes a week, with class size averaging around a dozen. That's smaller than most Zumba classes but gives each student more space. At $19 for drop-ins, Z Club NY is on the pricey side.
The company offers numerous grace notes, such as a receptionist who greets customers by name; themed classes, including a popular one called Afro Fusion Burn; and sessions that are followed by mingling and drinks at a club. The partners also coordinate social events that incorporate Zumba. But the instructors are the major attraction. The company hires instructors the same way stage producers hire dancers, with group auditions. Thirty ZINs turned up at the last one, many attracted by D'Alexis's reputation.
Salem says the company will expand in New York. "We are both riding on the Zumba brand and promoting it," she says. "Our commitment to them is to make Zumba look as good as it can look.
"If Zumba is a burger," says Salem, "we are the black label of burgers."
00:01 Claudia Salem: I've been enjoying a lot growing this business and all the entrepreneurial activities, and the possibility and the dream.
In 2011 Edmee Cherdieu d'Alexis and Claudia Salem started a Zumba instruction business in Manhattan.
Their Z Club NY is one of several thousand start-ups Zumba has spawned around the world.
00:38 Salem: So, for me, Zumba as a student and also Zumba as an entrepreneur trying to build out our own business, it's a huge opportunity.
Some 14 million people in 150 countries take Zumba classes at least once a week.
Zumba makes money licensing and supporting those who teach Zumba classes, who, in turn, can become entrepreneurs.
01:00 Salem: Zumba is still in growth mode. A lot of people still haven't heard of it.
01:05 Cherdieu d'Alexis: So, in the beginning, like any new business owner, we were like, "Oh, let's find a big studio in Manhattan and have 50, 60 plus classes a week." But reality hit us pretty hard, and we realized, "Wait a second, this is Manhattan. Unless we're gonna cash out 20 Gs a month to get a rental space and then you fix it up and down, before you know, we'd be in the red". So, we went a different route, which is partnering with studios and gyms that have space that were conducive to Zumba classes and that meet our requirements so far as location, size, sound, showers if possible, just space that people would wanna be in, and then we started basically having classes in those places.
For now, Z Club NY rents studio spaces on an hourly basis.
It started in two locations, and has grown to six.
01:56 Salem: We call the model we're pursuing, kind of a pop-up model and also a lot of on-demand. So, we can test the market. We can listen to what our customers want. So, we're lucky that it's still in growth mode.
02:29 Cherdieu d'Alexis: Although it is a program that is structured, within the structure of the program, it allows each instructor to have their own personality and their own class. The music, I think, it says a lot about the personality of the teacher. Of course, each instructor have their own choices.
02:49 Salem: I would even go as far as saying, instructors have following, and it's a huge fan base, it's like extreme loyalty, but the energy of the instructor makes all the difference, that's what attracts people.
03:14 Salem: So, the balance is going to be, "Do we keep our expansion plan and our light footprint or should we start as certain locations, you know, have enough time getting our own locations?" We haven't figured this out yet. I think we're just figuring it out as we go and whatever makes sense.