Advertisement
AB Newswire

Home Account Search
Blog: The Myth of the Health-Club Feeder System
Everyone in the health club industry has heard the idea that low-priced clubs are a “feeder system” to full-service health clubs. The low-priced guys themselves like to trot out this idea when they are trying to deflect the hatred spewed their way from owners of full-service clubs. Their argument is basically, “Don’t hate us, because at some point our members might want more than we can offer, and they’ll come look at your facility.”

Except they won’t.

Once the $10-per-month virus has entered a member’s system, our experience shows that it can never be cured. There seem to be two causes for this. One, most people really don’t want what our industry is selling, so if they can get it, whatever “it” is, for $10 per month, they are thrilled. Two, most consumers assume that every health club is the same, so why would they ever pay more? Once someone has been a member of a low-priced club, there’s not even an intellectual acknowledgement about why different health clubs might have different prices. They’ll say, “Oh, so you have a pool and classes and childcare and towel service and trainers who can answer my questions? That’s great. But my last club charged me $10 a month.”

We’ve been seeing this as people move to our area and call for pricing. They are obviously gym-goers because these are the type of people who look for a new club immediately upon arriving in a new home. Yet, all they care about is price, and they even like to lecture us about how we’d get more members if we charged less. (The part of that suggestion that would cause us to go out of business doesn’t seem to interest them.)

Another group that isn’t out there shopping for full-service health clubs is the large population of former members of low-priced clubs who got what they paid for at $10 per month, canceled their memberships, and now will never enter a gym again. With the $10-per-month virus having infected them and the ongoing assumption that all health clubs are the same, we aren’t counting on seeing a lot of these folks.

So, let’s stop with the myth that a significant number of people will “graduate” from a low-priced club to a full-service club. They won’t. The key for full-service providers is to win the initial sales battle when a consumer is first shopping for a gym. How to win that battle is a topic for another day, but make no mistake that you have to get these new members first, before the $10-per-month virus infects the patient.
Posted At 8:22 AM • Comments (5)

Do you mean before the member catches the $10 virus or the MRSA Virus - b/c chances are that's what they'll catch going to a place that does so little cleaning! (either that or ring worm).
Comment By Hugh J At 6/27/2011 3:38 PM
Well said....I have always felt that logic to be ridiculous.
Comment By Ron Byrd At 6/28/2011 7:03 AM
Not only do those members never go to a realistically-priced club, and not only do they think all gyms should cost $10/month, they also think all gyms are crowded and have very limited if any customer service.
Comment By Eric At 6/28/2011 11:50 AM
Although I typically like reading your blogs, I don't necessarily agree with this one and calling a lower priced fitness facility a 'virus' is harmful to the industry as a whole. My experience is that many people who gravitate to the low priced clubs at first are those who are just beginning and are intimidated by the high priced clubs. Once they build their self confidence and provided they have the available resources they will gravitate to the higher priced clubs that offer more fitness options and a greater social component. I operated at community center in a market that had a Lifetime Fitness, LA Fitness, Bally's, Snap Fitness and Anytime Fitness. Our rates fell in between the two extremes and we had members leave us because we did not offer things like towel service, free fitness classes and a bigger selection of equipment. At the same time we gained members from these clubs who did not want to pay extra for these benefits because they did not use them and the could not afford it. In essence, the customer understood 'you get what you pay for' and did not have the expectation that we should be the same as the higher or lower priced facilities. When you go shop for a car after previously owning an inexpensive Hyundai, you are not going to hold that standard to the next car you buy. I think you are not giving the people of Scotrun, PA the credit for understanding what they are buying. If I don't place a high priority on exercise or am just starting an exercse program, I like the fact that there is a low price option for me to at least get started. And if I like how I feel and it becomes a higher priority after a year, I would most likely 'upgrade' my membership to a different club. Anything we can do to get people off the couch and begin exercising is good for our industry.
Comment By RJ At 6/28/2011 1:07 PM
I believe that everyone who gets these emails and reads these articles works in the fitness industry in one capacity or another (I hope). So everyone is probably familiar with the volume of clubs (those with high priced memberships as well as low cost ones) that have filed bankruptcy over the years. Some chains so frequently you begin to wonder if its a part of their business plan? My point is that no matter what a club charges, there is no guarantee they won't go out of business due to poor money management. That said, as a member I do not care what my club charges so long as I perceive the cost to be a good value. Look, consumers seldom avoid buying something because they do not have the money or cannot get the money to make the purchase. They avoid buying what you are offering because they place a higher priority on spending the money for something else. Unlike a lot of people, I love to workout and place a high priority on my health and well being so, I want my club to stay in business, and I know they need to make a profit on my membership fees to ensure they survive. But, I expect to see something for my dues. Is the club clean and well maintained? Does it stink? Are the toilets clean? Is the equipment out of order for long periods of time? Does the person at the front desk know my name? Do I feel welcome when I walk into the club? Or do I feel like a hindrance to the employees? Health clubs (like most businesses) are like Vegas Prostitutes, the high class ones my be more expensive than the street walkers, but they make you feel real special and you're not embarrassed to be seen with them ...or so I've heard. :)
Comment By ML At 6/28/2011 1:50 PM
Comments :
 
Name :
Email :
       
 
Comments :





Facebook   Twitter   LinkedIn   YouTube   YouTube   AB Forum   ABC & Expo

Advertisement



Advertisement



Advertisement