Friday, December 14, 2007
You will need your current number of accounts, the average retail value of those accounts, and a calculator.
Take your current number of accounts and multiply that number by a factor of just 2%. Then take that product and multiply it by the average retail cost of your accounts. That answer is the increased revenue that will be generated by a 2% increase in retention... Pretty eye opening.
Now consider that this money is very clean, there is not a lot of increased costs that come with it, so the money is truly very close to an increase in your net income..
Active accounts 2500
Avg Retail cost 700.00
2500 x .02 = 50 saved accounts
50 x 700 = 35000.00 additional dollars on your bottom line
Try one of our actual clients' returns
Active accounts 5500
Avg Retail cost 1000.00
5500 x .05 ( yes a 5% increase) = 275 saved accounts
275 x 1000 = 275000 WOW!
This is possible for you, if you start to change your focus today.
Tuesday, November 27, 2007
Pretty negative thinking, but my challenge to you is to contact ALL your member regularly, heck, plan it out and do it all the time. By keeping in contact from day one you assume the responsibility of ownership of that member's business. Engage them, get them involved in your club and earn their business for life.
Find a way to track the member's visits to your club and when you see a break from a habit, give them a call and show you care.
We are in the people business and we need to take the lead to ensure they get more than they expect.
Good Luck and Stay Focused on that member.... they are our business.
Tuesday, November 6, 2007
What is our goal?
By making the effort to market to all members of our society we can increase our market share tenfold.
At our club, we realized that we haven't been checking on the exercise prescriptions that are being issued to our members. We like many others have mistakenly figured we taught them how to do it correctly that the Fitness coaches would be using their skills to execute it properly. In about 5 minutes and with ten quick reviews we realized that we would need to check their work on a regular basis. We had a coach write "whatever you enjoy" under the cardio section. This was a new member with very little experience and likely they didn't know what they "liked"at this point in their journey at our club. As owner/managers of our clubs we are responsible to make sure that all members become long term clients of our facility.
My personal experience has lead me to realize that if we don't check it, there is no reason to install it. Make sure you are getting regular looks at your systems and set up procedures so that you can see any changes in what you expect to be occurring. My best example would be to run your systems like you drive a car; you need to make small adjustments in speed, steering, and monitor your dashboard regularly to make sure that you stay the course.
Thursday, October 18, 2007
The answer to our mission is that we need to define our goal. That goal should be to create Members4Life everyday. It isn't as simple as sending cards or email, or even getting them to purchase PT sessions at Point of Sale. It isn't about giving them a complete evaluation. The answer my friends is "blowing in the wind". The answer is to change the environment in your club, every member of your staff needs to be on the same page and that is an attitude that you feel everywhere in your club. The "wind" that blows through your lobby, hallways and all your rooms needs to be that we invest all our time and energy in making our members successful. That member success is directly proportional to the amount of involvement that we get our members to accept.
As new members expect, unrealistically, that they will lose 5 lbs by signing a contract with your club as if a magic pill is available, so it is with our retention. It isn't one thing or even two, it is the combination of your commitment to the member's success and your team's attitude that IT is about the member's need, not your staff's needs, which come first.
Act today and start the change in your club by spreading a new attitude in your club. Tell one team member to act with the member's success first and soon you can have a positive epidemic in your hallways.
Saturday, October 13, 2007
Spent the day in Chicago at the Club Industry Show. It is always good to get a look at the state of our industry. It is customary for me to take a walk through the whole show and get an overview of what is there. Some of the stands are occupied by the regular attendees, but it is the new and different stands that I search out. The new piece of equipment or the new product to make our clubs the latest and greatest. I always look to see what is there to keep our club on the cutting edge or what project we can bring back to challenge our staff.
As I ended my tour, it occurred to me how few booths there truly where and how few attendees were there. The latest number that i have read stated that there are over 27000 health club in the US and realizing how easy travel from Canada would be to these shows, why are there only a few hundred attendees. If every club only sent one person to stay in touch with the state of the industry the number would be hard for any event to coop with.
Are we so in touch with the industry with the publications and internet presence that we don't need to attend these shows. Personally, it should be a required event for every General Manager in every club. The speakers and the networking that is available is beyond the capability of our in house training ability.
We need to keep the progressive, entrepreneurial spirit flowing in the health club industry. It is said that we need to keep growing or we die. One of the best pieces of business advice that i ever read, told me to "sharpen the saw" everyday. Strive to learn something new everyday and implement the best of these ideas. It is better to try and fail then to not grow. This industry needs the consistent push to challenge the norms, and by doing this we in effect will continue to challenge and involve our members. Involvement equals longer retention.
Wednesday, October 10, 2007
Do you feel the pain?
Sometimes it really takes a major amount of hurt to make us react to a problem. Most of the time we don’t act until it is too late. In most clubs, in the United States and around the world, sales are still coming easily; with clubs signing enough contracts to pay the bills and owners still able to enjoy the good life. What happens when the stream of prospects starts to decline and the front end of your business starts to suffer? Do you act or react in your business?
It is time to prevent the problem before it happens. Let’s first change the way that we look at the club business and start to ensure that our sales turn into long term clients. So many times our business model looks like a tube with as many members falling out the bottom as we are signing into the top. We need to change the shape of the tube and let it form a funnel. We can adapt our marketing plan, our staffs’ attitudes and install a system of member induction that will cause very few members to fall out of the bottom.
Recently, a friend of mine wrote an article stating that if we assume a new sale is a customer we are mistaken, and only after two to three purchases from your business, may we claim that right to call them a customer. In the fitness industry, this may be altered to read that they aren’t a customer until they become a regular user of your club and have purchased additional services at your club. It truly is a question of involvement and until the new members feels the value in your club, it will always be too much money and not worthy of their time to frequent your club.
As club owners/managers we should be proactive in setting up a successful system of member induction that is able to identify a new member’s true needs and goals. This system should encourage and provide a pathway that is challenging but completely doable. Our staff needs to understand that often we over estimate the condition of the new member and may prescribe a “standard” exercise like 30 minutes of cardio, when the new member would be sufficiently challenged with 10 min three times per week.
We so often miss the mark of what is the true desire of our new members. Out of habit or complacency we prescribe an exercise solution that is not going to bring them positive results, either in enjoyment or positive physical change. We falsely decide that everyone joins a club to lose weight, when that may not be the reason at all. We are missing the bull eye if we are not identifying the real need. This may be a desire for more energy, or even the realization of improved health and well being. People will join clubs to be part of a social circle, to enjoy the feeling of people around them. They need to feel that they belong in our strange world.
If you ever traveled to a foreign country you probably have experienced the inability to communicate the same way you are used to doing at home. The simplest task, like buying gum, turns into a humorous exchange of pointing and nodding your head one way or the other. It can be an extremely frustrating experience. You desire a translator; You desire to have a friend that will be able to help you get acquainted with the lingo and once you hear it a few times it starts to get easier.
It is much the same with a new member deciding to travel to your club and walk through those scary doors into a new and different world. We need to identify this situation and train our staff to speak as an interpreter in our strange land. By providing an environment where the new member is able to learn the "language" at a comfortable pace, we in effect help them to become comfortable and realize that it is a place they should visit often.
We can all succeed in this goal by informing our staff of this issue and teaching them to realize and pay attention to the words they use. Sending a member to the fitness floor, or telling them to meet you at the Smith Rack will accomplish more harm then good. Teach them to use common terms, like meet me at the water fountain.
With a few simple implementations, we change the world, one member at a time.
· Teach your staff to view every new member as a life long friend. Use language that helps the new members understand your goal. Teach your sales team to tell prospects that we are building long term members and that you main goal is to make them successful.
· Develop a club attitude that is about the member feeling successful.
· Smile and be open, encourage every member of your team to make friends with every member they meet.
· Implement coaching into your weekly team meetings and encourage your staff to use the same type of language that you would use outside of the club to a non exercising friend.
· Start to keep track every month of new sales and cancellation and ensure that your membership is growing. Be proactive with new members with low attendance numbers and contact them if you see a decline in visits.
· Purchase or build a system that will ensure consistency in your club and be certain that all members are given all the tools necessary to help them be successful.
How nice the thought of your club with a large membership that stays for years and purchases many types of products and services from your business.
Take a little time and change the way you review your business. Every new member is a stone in the house of successful club ownership.
Good Luck and Success in having Members for Life.
Thomas Kulp may be contacted at 717-490-8063 or emailed at email@example.com. Visit his blog at http://fitnessclubconsultants.blogspot.com
Monday, October 8, 2007
Let's take a count of all your member accounts right now. A complete listing would be accurate if you counted all the total accounts and not your number of members. I think that a discussion involving visits would be best served by actual number of members, but here we need number of accounts. If you haven't ever calculated your retention prior to this then we can you this number as your starting baseline. Every month we are going to add the number of new accounts (including reinstated accounts) and subtract the number of canceled accounts from the base number. The use of an easy excel spreadsheet would be beneficial and I would be more than happy to forward one to you, if you want to email me a request. Every month we can now see if we are growing or sliding backwards. At the end of any 12 month period we can then divide the total number of cancellation by the average accounts throughout the year to get our yearly attrition rate.
This information is key to deciding if you are doing the correct things in your club to be a growth oriented business.
Thursday, October 4, 2007
It is much the same with a new member deciding to travel to your club and walk through those scary doors of yours into a new and different world. We need to identify this situation and train our staff to speak as an interpretor in this land. By providing an environment where the new member is able to learn the "language" at a comfortable pace, we in effect help them to become comfortable and realize that it is a place they should visit often.
We can all succeed in this goal, by informing our staff of this issue and teaching them to realize and pay attention to the words they use. Sending a member to the fitness floor, or telling them to meet you at the Smith Rack will accomplish more harm then good. Teach them to use common terms, like meet me at the water fountain.
This easy to implement skill will easily have a positive effect in your retention.
Wednesday, October 3, 2007
This is exactly one of the problems in our industry. If we even have a new member induction system, we have very little control over the entry and the process of how it is done. If you are going to install any system in your club, then accountability is key to the success of the system. What you don't measure, doesn't matter.
We allow our staff too much freedom and sometimes decisions are made for the wrong reason, that is one that is not inline with your companies policies. An excellent example is a club that I worked with had a 30-90 minute "getting started" program, when I ask how did they decide who got 30 and who got 90 minutes, the answer was silence. They didn't realize that their system had no system. It is too easy to meet with people we relate to, and difficult to relate to the ones that are different from the norm. Well folks, in the US market, 85% of Americans are different from "our Norm", we need to learn to speak there language.
Tuesday, October 2, 2007
Recently I spoke at the MIOFF 2007 conference in
Many of our friends in Russia were interested in how to do it correctly from the first day and many questions showed their desire to keep there members for life. My passion for this goal was in high gear and the emails that will follow will be of the heart warming quality.
The fitness revolution was in full swing in a country with the average life expectancies in the range of 56 years. The high use of alcohol and the smoking taxes a high price on health. The fitness industry is in need of all the support we can give it to achieve the penetration levels we desire in the world market.
I am committed to making a difference worldwide.
Retention: Are you focusing correctly?
What you do first, typically declares your priorities. Many club operators start their workday inquiring about what were yesterday’s sales; 365 days a year their focus is on what is coming in the front door and how many are walking out with a contract and a dream of the new body they plan to build.
Imagine a day without worrying about your sales and being more focused on what the retention number is or even better the growth rate of your club on a daily basis. A club with their focus here is a club with a stone foundation; a guaranteed income stream to pay the bills, the staff; and live the life the owner dreamt about when he opened the doors.
Retention is the biggest piece of the success puzzle, yet most clubs have not discovered this diamond in their success formula. What a dream it would be to have the ability to keep every member we sign from day one of the club’s opening. Whether a new club or an existing club of ten years the ability to not need to spend money on marketing and promotions to bring people in the door is awesome. What could you do with the money that you save on not prospecting new sales; build other clubs, keep your current club up to date with the latest and greatest equipment, or increase the benefits to your staff to ensure their long term commitment to your club. Dream big you will have the money to spend.
The focus change needs to start with a system. This system needs to cover the moment your new prospect walks in the door until death or moving do we part. Starting with the end in mind is a phrase that is appropriate here. The new prospect is scared; scared of failing one more time in a pursuit of their lifestyle change, scared of being promised success and there not being a life line there for them. You need to ensure that you are able to guide the new member with a systemic approach to success making sure to avoid committing information overload, and using intimidating language. Making sure to deliver a simple, direct, consistent message is the primary mission. Your choice of staff is key and hiring for personality is most important. Your personal trainers are likely the wrong people to deliver the new member introduction, as this is not the time to be selling to a new member who is uncommitted to a long journey. You need to find and hire coaches that are trained to send a message of belief and success and have the tools to deliver the journey. These trainers are very often your caring and enabling staff that will spend a good deal of time concentrating on the members needs and making them feel comfortable at your club.
The journey ahead needs to start with a simple assessment of where the new member is at and a mapping of the path to success that lies ahead. Additional meetings are needed to schedule and plan a workout program, and then check in on them to guide and nurture the trail to be traveled. Finally we need to ensure a review of the pathway and reassess the original benchmarks. It is in the discovery of success that the energy to move on with their membership will be unveiled. No one wants to spend money uselessly, and even a dollar a month is too much if the enjoyment and success feelings are not present.
Studies increasingly show the impact of raising the number of visits in the first 30 days of membership. Our club measures the first 4 weeks of membership by visit count. The number of visits needs to exceed 8 visits in the first month and compensation for our coaches are based on that number. We measure the usage in the next phase of membership from 5 to 12 weeks and watch the engagement of our members like a hawk.
While spending the money to staff this seems like a cost concern, I challenge that notion with the fact of improved Personal Training Revenue, boosted attendance at your club, and the additional revenues that are acquired in the process of your members spending more time at your club. An involved member is an active member and active members pay there dues and spend money at your club.
The challenge is to change your focus and realize the value of every member becoming a life member of your club. Imagine the day that sales are a minor concern and the number of referrals rises to a level that outside marketing is no longer needed. It can and will happen if you change the way you view your members today and the one that will join tomorrow.
Do you feel the pain?
Sometimes it really takes a major amount of hurt to make us react to the p
It is time to prevent the p
Do you look at your total membership number every month? A simple calculation of the number of accounts billed this month plus the number of new sales minus the cancellations should be accounted for every month. Keep this number handy and monitor to ensure that we are growing every month striving to reach our calculate goal membership number.
How nice the thought to become a club with a large membership that stays for years.