Is it Time for Independent Health Clubs to Ditch Membership Sales?

Ask any independent health club owner what business they are in and you are bound to get answers ranging from fitness to wellness to community building. But the business gyms have always been in is the membership business. Any banker or venture capital firm will tell you that's what a club is.

Shorter Or No Commitment Memberships Could Be A Way To Boost Revenue And Lure Customers Away From Local CompetitorsSure, within the four walls of the facility there is fitness, wellness, community and more, but unless people walk through that door there is no business. That's why it may be time for club owners to re-think the business they are in.

While people have long been conditioned to sign a contract for one, two or even three years to cut their monthly rates or get a “break” on enrollment fees, that mindset has been eroding. Health clubs, cell phone providers and even cable companies are changing their models to attract commitment-phobes and stay ahead of growing competition. And you have enough competition as it is. Throw in the proliferation of boot camps, yoga studios and CrossFit locations that are popping up on every corner and traditional club owners are feeling the squeeze to bring in more exercisers and compete for limited dollars.

While some health clubs have had great success with no-commitment memberships, they run into a problem of high attrition rates - some reaching into the 90 percent range. Throw in the added marketing costs of of attaining new club goers and it can be expensive. However, that doesn't mean it's not a way to go – or the only way.

While offering shorter or no commitment memberships, selling class cards to compete with yoga studios, or even offering non-member rates for boot camps and other functional circuit training classes may make it harder to project long-term revenues, it could bring in additional funds you're currently missing out on. And with correct pricing, it will still make a membership commitment attractive to those not adverse to contracts.

But, while this can bring in additional revenues, it does mean that management needs to step up their game to keep these short-timers happy and heading back time and again.

This means that all of the little things that might annoy a member who is locked-in will send that commitment-phobe heading to the competition like Julia Roberts in Runaway Bride.

Maybe it's an exercise class that always starts 10-minutes late. It could be that the locker room is in a bit of disarray. Or worst of all, it is that the customer service team is not doing their part to make everyone that walks through the door feel welcome, informed and happy to be there –basically making going to the gym a “want to” rather than a “have to.”

While the membership model may never truly disappear, independent health club owners have the opportunity to work in new revenues models to turn other fitness facility ex-members into their exercisers and boost the bottom line at the same time.

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