One year ago, we wrote in Athletic Business, "Dear Bally Total Fitness: Please go away."
It's a shame they didn't listen. A year later, Bally is more embarrassing than ever. At least the old Bally didn't care about its members and made no bones about it. But the "new" Bally is supposed to be all about the customer. We know this because Michael Sheehan (CEO of Bally since 2008) told us so in his November 2010 interview in Club Business International. "We've stopped the practices that put us at odds with our members," he said. "The central difference, now, is our commitment to being a customer-centric brand - one that's less concerned with self-promotion and more intent on doing the right thing." He also emphasized that Bally had shifted from "being a collections-based organization to being a member-focused organization."
The CBI interview was published just months after Bally was charged by the Texas Attorney General with unlawfully attempting to mislead former customers into paying "past due" membership fees they did not owe. Between 2009 and 2010, Bally sent 11,000 such notices to former members. A settlement was reached in the summer of 2010 in which Bally admitted no wrongdoing, but agreed to refund money to more than 1,000 former members. (For fun, take a look at the statement from the AG's office, which includes a sample notice.)
Our favorite detail of the settlement is that it included an injunction that prohibits Bally from telling members and former members that they owe a balance unless that balance is actually owed. Like Seinfeld's George Costanza reacting to being fired for having sex with the cleaning woman in his office, we imagine Bally personnel being shocked that they shouldn't have invoiced customers for money that they didn't owe. "Was that wrong?"
Now, Bally is back in the news for the abrupt closing of one of their clubs in Massachusetts. Bally seems to be managing this closing as amateurishly and disreputably as the worst closings we hear about in our industry. These are the closings that make consumers believe that all clubs are out to rip them off and that cause state legislators to implement consumer protection laws.
According to press reports, the closing of this club features all of the checklist items you'd want to include if your goal was to offend and anger consumers. Short notice - just 48 hours - before the doors were locked. Specials to drive prepaid renewals and memberships just weeks before the closing. Passing the buck on how to request a refund, leaving members to wonder if they will even receive refunds and leading them to contact their state Attorney General.
Thank goodness Bally is now a customer-centric brand that is intent on doing the right thing. Can you imagine what would have happened in Texas and Massachusetts if they weren't so concerned about customers?
We shudder at the thought, and are again embarrassed for our industry.