How Ben Francis built Gymshark to a £1 billion global fitness phenomenon

Hey Friends,

This week we’re looking at Gymshark.

So… How do you build a £1 billion global fitness phenomenon?

Story Time

When Ben Francis started Gymshark to sell the sort of gym wear he was looking to buy in 2012 he couldn’t of known that he was actually making the first steps in building a global fitness phenomenon.

But that’s exactly what the Birmingham University student was doing.

From a 400 strong headquarters in Solihull sales reached £176 million last year.

Gymshark is a posing a credible challenge to industry giants like Nike, Adidas and UnderArmour.

I really believe in Gymshark as a brand that has the power to dominate long term. This week I wanted to take a look at some of the factors behind its success.

A deal with General Atlantic this summer values the brand at £1 billion.

So… how do you build a billion pound business with international growth at rates over 100% year on year?

Background

Francis started Gymshark whilst at University. He had dabbled in website and app building since school, and had created several small businesses with varying degrees of success.

When talking about this, you can see Ben had developed a mindset for experimentation, leverage and a pure self-confidence to give things a go.

He’d bought and sold car number plates, developed iOS fitness apps for the App Store and was always trying new ideas.

This all led to Gymshark, which started as an online store for fitness supplements and clothing.

Having no cash to actually buy stock, Ben and his partner Lewis Morgan, designed the stores order system to trigger an actual distributors website to do the hard work of processing and sending the product. Gymshark just collected a small margin.

At minimal risk they could make money.

What is remarkable is that from here, to the point where they were doing a quarter of a million in revenue, Ben was delivering pizzas to hedge the risk of failure and invest everything back into the business.

Eventually he would quit his pizza delivery job but even then, only because the work was clashing with his lectures.

To this day, Gymshark has no debt on the books and generated pre-tax profits of £18 million last year. It has always driven growth through its own cash flow.

Ben would eventually quit university too.

Getting high on your own supply

Whilst still there, and with cash in the bank from skimming margins, Ben and Lewis were able to stock all the gym wear they could get their hands on.

But looking across their suppliers, they were finding that no one was making the type of clothing they actually wanted to wear.

Little did they know, they were not alone as underserved gym-goers. This was a first eureka moment.

The boys invested in a screen printer and sewing machine to produce longer, stretchier and better fitting gym tops that people would actually want to wear in the gym.

They spent the next year producing these products by hand.

When not sewing, they found themselves watching endless hours of bodybuilders and gym goers on Youtube.

So it came naturally to send the Gymshark product to them at the first opportunity. These influencers shared their thoughts in videos on their channels which were watched by audiences of like minded gym goers who in turn would check out the product.

What they had discovered was influencer marketing long before it would become known to be the highly effective marketing strategy.

This was a second eureka moment.

Gymshark would go on to create one of THE playbooks for influencer marketing.

Not only were they creating gym wear for themselves, getting high on their own supply, but they had discovered this team of equally gym obsessed athletes who were passionate about the brand.

It was a perfect loop:

• Creating a product to meet an unfulfilled or under-served market need
• Feedback and marketing from super users with their legions of highly engaged fans
• The ability to come back at the next product drop with something even better based on that feedback
• Back to the start of the loop

When you look at early product releases such as the Lux Tracksuit, the reaction to each drop is fanatical.

Brand Building

If you’ve read Phil Knight’s book ‘Shoe Dog’ you will know that the Nike Founder fuelled the rise of his all time great company through brand ambassadors such as Michael Jordan.

Famous athletes and sports people were the way to sell sportswear and the cost of working with them today reflects this.

Gymshark discovered the sports brand ambassadors of the digital age: everyday athletes, gym-goers and fitness models with little or no mainstream following but highly engaged profiles on social platforms.

Not only are these influencers much easier to work with than mainstream sports stars but their followers can have a much closer affinity with them. Every day people who share their lives online and who’s lifestyles seem more attainable.

Yes Gymshark has a brilliant product, but it’s brand is equally as strong.

Gymshark athletes are stacked, ripped, and have model good looks. Traditional marketing tells consumers that, they too, can look like that if they buy the brand’s product.

But with Gymshark, there is notable importance given to the character behind the image: healthy, fun and approachable.

Gymshark athlete MattDoesFitness makes videos ordering ‘circle sized’ pizza with his young son and doing fitness challenges with his wife. He is a former PE teacher with a relatable story that he shares with over 1 million followers.

Gymshark balances the Apple-like clean good looks of an exclusive brand in it’s website, choreographed events and instagram channels, with a realness behind those good looks that makes everyone feel welcome.

Temples To The Brand

Gymshark does 20 events a year.

Its early traction was borne out of the annual Body Power expo in Birmingham.

Gymshark’s booth would be the launch pad for new product drops and be manned by it’s athletes, creating a frenzied rush at the expo to be in first in line. The crowds drawn in would grow so big year on year that Gymshark would eventually outgrow the show itself.

There is something very powerful about the pop-up store and Gymshark has made it an annual event in countries around the world.

A one day or weekend event where people can come and literally touch the brand: Gymshark Athletes, Ben himself and racks of fresh product exclusively shipped in.

In Scott Galloway’s ‘The Four’ he describes the Apple store concept as a temple to the brand: beautiful white churches with incredible architecture, served by high-priests called ‘geniuses’ who spread the good word of Steve Jobs and brand Apple.

Gymshark has found something similar. Transforming super cool spaces into one day temples to the brand, manned by true disciples: Gymshark athletes . These choreographed events have been a runaway success.

They too feed the user feedback loop. Ben describes an interaction at a pop up in Canada: “a guy came up to me and asked why we didn’t do camo tops, and I said: To be honest, I’ve no idea. We went back and made them and people have loved them ever since”.

This openness and interaction does not happen with the CEO of Adidas or Nike.

Coming For The Swoosh?

Gymshark is fundamentally a strong business with a great product that really gives its market of gym-goers what it wants. As more and more people hit the gym and exercise, I can think of few brands that better serve this space than Gymshark.

There is no doubt that timing has played its part in the Gymshark story. The rise of social media and the move to online retail have propelled its success. Gymshark has been powered by new e-commerce platforms like Shopify to help it scale online.

But what separates Gymshark is its ability to take full advantage of every opportunity it has found infront of it. Whether that be skimming margin in the first days, building the first team of online fitness influencers or in it’s pop-up stores.

Gymshark has a knack of executing extremely well 9 times out of 10. That’s Ben and the team’s superpower.

This year, Gymshark raised funds for the first time. It will fund a £100 million push into Nike’s backyard. Few companies have what it takes to put pressure on the Nike swoosh, but Gymshark might Just do it!

Lessons

1. Experimentation

Ben and Lewis didn’t start with the Luxe tracksuit or Gymshark as we know it as a gym wear brand today. They played around in an area that they were interested in, drop-shipping supplements, building fitness apps and websites. It was fun for them.

That experimentation led slowly but surely to a product with genuine market fit and the foundations of the brand we know today. Gymshark continues to experiment with pop-up stores, new product lines, non traditional sports sponsorships such as MMA.

Experimenting is baked into the culture.

2. Leverage

Gymshark has mastered leverage.

No stock? No problem. We will drop ship and skim a margin. No audience? No problem. We will build relationships with undervalued influencers who have. No IT infrastructure? No problem. We will use the worlds no1 e-commerce platform.

Gymshark prove you don’t need piles of cash to start a business today. Leverage the power of the internet.

3. Customer obsession

Ben and the team have a major advantage in genuinely caring for the products Gymshark creates. They are all Gym fanatics and essentially creating products for themselves. There is no buyer persona they are trying to figure out or predict. If they love what they’re making, the chances are the Gymshark community will too.

When Ben goes to the Gym he knows if he is genuinely making great kit because he’s wearing it. That authenticity pays.

4. Community

The relationship we have with an influencer who invites us into their life through an instagram story we watch every day or in a 10 minute weekly Vlog, goes way deeper than any billboard or 30 second TV ad.

Gymshark has built a community of influencers who each have an almost daily interaction with their followers. Their affinity with the many faces of the brand go far deeper than traditional marketing allows.

5. Execution

Underpinning everything that Gymshark does is a knack for executing really well. They have a knack of taking the right opportunities at the right times and are precise in how they do so.

The complex choreography of product launches or pop-ups that go off frequently without a hitch is proof of that.

For more of Ben and Gymshark’s story, I recommend checking out his blog here or Lewis’s podcast.

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This post was originally written for the Digital Evolution newsletter.

Check it out here: https://digitalevolution.substack.com/welcome