Investor Newsletter – February 2021 In this month’s investor newsletter, we look at the key growth segment of home fitness, a rapidly evolving market with music at its core. We consider fitness trends and the role of 7digital, catch up on client news and put Apex Rides under the spotlight. INVESTOR NEWSLETTER February 2021 Update From CEO Page 2 Industry News & Insights Page 5 Spotlight on Apex Rides Page 4 News Bites - FORME Life and GrandPad Page 3 “Music has become critical to online fitness services amid the Covid-19 pandemic; instructors have become like DJs” - Wall Street Journal
Transcript
Investor Newsletter – February 2021 In this month’s investor newsletter, we look at the key growth segment of home fitness, a rapidly evolving market with music at its core. We consider fitness trends and the role of 7digital, catch up on client news and put Apex Rides under the spotlight.
INVESTOR NEWSLETTER February 2021
Update From CEO Page 2
Industry News & Insights Page 5
Spotlight on Apex Rides Page 4
News Bites - FORME Life and GrandPad Page 3
“Music has become critical to online fitness services amid the Covid-19 pandemic; instructors have become like DJs”
- Wall Street Journal
Investor Newsletter February 2021
2
This past year of global lockdowns and the accompanying shift to home workouts has highlighted a fact well-known to fitness innovators and trainer teams everywhere. That is, the vital role digital music plays.
For 7digital, it is a hugely exciting market and we are positioned to be the dominant music solution provider to the home fitness industry.
Music is such a powerful tool, creating emotional responses that boost happiness and enhance quality of life. Our newsletter last month highlighted the scientific evidence for music’s health benefits. This month, we focus on its importance to the fitness industry and our clients. Music increases enjoyment, motivates, makes hard work less arduous and keeps customers coming back for more.
Digital services grow in popularity every day and home fitness services place music at the heart of their appeal. 7digital offers these service providers a full music solution including a pre-licensed music catalogue, content delivery, reporting and rights-holder payments, curation and playback of playlists for recording live classes.
In the recent past, even big fitness players have occasionally fallen foul of licensing rules. But because we take care of all the back-end technicalities, our clients can focus on providing a great product and service to their customers, worry-free.
We expect to sign about six deals in 2021, generating substantial year on year revenue growth in this segment.
UPDATE FROM OUR CEO
Music is central to the fitness market – and now more than ever
Paul Langworthy Chief Executive Officer
“We are positioned to be the dominant music solution provider to the home fitness industry“
2
“We expect to sign about six deals in 2021, generating substantial year-on-year revenue growth in this segment“
Investor Newsletter February 2021
3
GrandPad, the world’s first purpose-built tablet for the over-75s, is widely used in the US to counteract loneliness and connect with family, friends and carers. The good news is, since our client teamed up with Ericsson and Orange Belgium, the tablet has become available on the other side of the pond too.
This means older citizens in the UK and Ireland can now buy GrandPad via specialist retailer TechSilver – and there are plans to expand to other European countries in future.
GrandPad features a pre-loaded music service, as well as other stimulating activities. Because of its 4G LTE, no pop-ups, built-in security and ease of use, it is simple for older adults to stay in contact, even amid
lockdown restrictions. 7digital’s music platform has been integrated with GrandPad since 2016. Our contract was renewed last year, and users have access to more than 30 million songs and customised playlists.
“In a world where health concerns and limited mobility may distance seniors physically and emotionally, this technology can help reduce the negative health impacts created by isolation and loneliness and make family caregiving much easier," says Scott Lien, GrandPad’s CEO.
A new era of connectedness for Europe’s older generation
Learn more about our partnership with GrandPad on www.7digital.com
At the end of February, 7digital added connected fitness company FORME Life to its growing roster of clients in the home fitness market.
FORME Life trainers will utilise 7digital's music-platform-as-a-service to access a licensed catalogue to cache or stream music content that can then be synchronised with a training video and played on-demand and live.
An immersive and engaging home fitness experience, FORME Life transforms an elegant, full-length mirror into a personal strength studio for body and mind.
“FORME Life looks like an expensive mirror but is in fact a touch screen, voice-activated, wall-mounted studio that also has attachable equipment,” said Vogue magazine. The company has also been featured on Bloomberg and CNN.
The FORME Life hardware and programming launches in Spring 2021 and will be available in the continental US for the first phase of the rollout.
“Of all the B2B providers, 7digital have the best solution and own the ‘fitness' space," said FORME Life. "Their support and knowledge is second to none, plus they were the most responsive and knowledgeable during the tender process. We have had a fantastic experience working with their team so far and their support is excellent.”
Find out more about our new client on www.7digital.com
“Of all the B2B providers, 7digital have the best solution and own the ‘fitness' space.”
In September, 7digital signed a 12-month contract with smart-bike and in-home fitness platform Apex Rides. Following a successful launch, the London-based company is powering customer fitness classes using our playlisting tool and global music catalogue.
HOW DOES IT WORK?
Exclusively partnered with boutique fitness pioneer Boom Cycle, Apex Rides provides a full bike and subscription service with live and on demand interactive classes. Bluetooth technology connects to users’ iPads or iPhones so they can stream and take part in classes. Real-time interactive leader boards measure RPM and resistance, with Apex reward points up for grabs.
WHERE DOES MUSIC FIT IN?
7digital’s platform ensures instructors have access to fully cleared and compliant music, enabling customised playlists curated by genre, tempo or theme to fit a particular class ethos.
“We recognised from the start that music is an essential and powerful ingredient in the context of fitness and wellness, and we needed to make sure our instructors had the tools to give members the best overall user experience,” says Simon Cook, who co-founded Apex Rides in 2018 with Charlie Lucas.
Bikes are available from the Apex Rides website and John Lewis retail store.
As the newest kid on the block in the UK exercise bike market, Apex Rides’ fresh, ergonomic design, state-of-the-art tech and gamified software, plus accessible pricing, have quickly attracted attention. Pre-orders of its bikes hit 2,500 in the first six months. In January, the company announced it had raised £3 million, including backing from ex Formula 1 boss Eddie Jordan and Capita founder Sir Rod Aldridge, which will be used to fuel app and hardware development, wider content creation and international expansion.
“Beautifully designed and sold at a more accessible price”
- Forbes
Read all about our contract with Apex Rides on www.7digital.com
For many of us, local gyms were a haven in our daily or weekly routines. They were a space to de-stress, improve our fitness or even socialise against a background of our favourite pumping beats or a spot of something quieter for, say, a yoga class. Then along came Covid-19.
It seemed the $94bn global fitness industry would be hard-hit by the resulting enforced closures. Yet fears of its demise have been, as Mark Twain once said, greatly exaggerated. We have seen a transformational shift to home fitness among the 183 million paying subscribers and other casual exercisers, complemented by a Millennial and Generation Z-driven demand for music.
‘Music has become critical to online fitness services amid the Covid-19 pandemic; instructors have become like DJs,’ says the Wall Street Journal.
In the UK alone, home gym equipment sales spiked more than five thousand per cent. The US market is predicted to rise from $11.16bn in 2018 to $23.27bn by 2025 - with 63% of regular exercisers likely to retain a home/gym mix post-pandemic according to Fortune Magazine.
Research by Brunel University for LesMills showed on-beat music was key to enjoyment - inspiring, engaging and keeping members coming back for more. The right music reduced perceptions of exertion by 12%, increased the effects of exercise by 15% and boosted endurance by 15%, among other benefits.
Great music is the key to any good workout, and with home fitness set to become commonplace in our health regimes even after the pandemic, we are likely to see many more music-based apps come to the market.
INDUSTRY NEWS & INSIGHTS
Fitness powers up
The right music reduces perceptions of exertion by 12%, increases the effects of exercise by 15% and boosts endurance by 15%
