Bally Total Fitness has hired Eastwest Creative Group for promotion and advertising projects.
The assignment for the New York-based agency includes media advertising as well as national promotions and guerilla marketing to spur annual memberships. Ballyhas 390 health clubs in 29 states; the company spent about $75 million on measured media last year. Starcom, New York, continues to handles media-buying; Grupo Gallegos, Long Beach, CA, handles Hispanic media buys.
The assignment to Eastwest, made in August, comes as Chicago-based Bally wrestles with soft membership sales and top management changes: Paul Toback resigned as President-CEO on Aug. 11, and was replaced by interim CEO Barry Elson. Bally’s board of directors plans to hire a permanent replacement.
Bally signed up 1.2 million new members in 2005, up 3.3% from 2004. Its 2005 sales were $1.07 billion, up 2.2% from the year before.
Bally lowered its earnings expectations for 2006 by 10% to 20% and delayed its report on second-quarter financials until Sept. 11, citing a slowdown in membership growth. Bally had been considering a sale or merger, but is focusing now on financing options, including recapitalization or taking the company private. A class-action suit charging the company with securities fraud was dismissed in July.
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