The Marketing Side of Retention
By Casey Conrad
Retention is not a new concept to the fitness club operator. For almost two decades now there has been considerable focus on improving retention as a way to increase the level of a clubs’ success. One common phrase used as it relates to retention is “closing the back door,” which means stopping (or slowing) the number of new members who are leaving out the back door (quitting) as fast as they are coming in the front door (joining). Of course, although most club operators are in agreement that retention is important, no one has come up with a “recipe” to follow that will systematically improve retention.
One reason for this lack of “recipe” is that no one really knows exactly what affects retention. Is it having great programs at the club or a friendly staff? Is it good customer service or having a clean facility? Is it having the latest and greatest fitness equipment or awesome group fitness instructors? Who knows? I have worked with hundreds of clubs worldwide and have seen small, drab, under-equipped facilities thrive while watching beautiful, state-of-the art facilities die on the vine. On one hand it is intriguing trying to figure it out and on the other it is frustrating not uncovering a definitive answer.
With or without an answer, a club operator can’t ignore the importance of retention. As a result, the HEALTHY INSPIRATIONS management team has given a lot of time, energy and focus on the subject. In collecting and analyzing our Centers’ of data, we believe we have made a discovery as it relates to understanding and improving retention. Specifically, that although there are many, many things that seem to affect retention, there is one factor that has a greater influence than all the others. That one thing is usage. That is, when a client is consistently using the center 2-3 times a week they have a greater likelihood of sticking with their program than a client who has fewer visits.
I’m sure some veteran industry readers reply to this “discovery” is, “Well, duh,” but before you dismiss the finding as trivial, let me say this; only by getting clear on an issue can you focus on what needs to be done. As simple as identifying that “usage” is perhaps the only direct link to retention is, the end result is a new focus on creating programs and systems that have one goal in mind—getting a client to use the club/center 2-3 times per week.
When our management team made this discovery and began formulating a new retention plan we made an important decision. Retention of our members is just as important (and challenging) as marketing for new members and, therefore, actually needs to be part of our marketing plan.
In past issues of Club Success I have written about how to create an effective marketing plan. (See issue X, 2003?) As readers may remember, one of the fundamental concepts to a good plan is following a “Parthenon” approach. A Parthenon is a Greek structure that typically has many pillars to support its’ roof. A “Parthenon” approach, therefore, is when a business is using multiple types of marketing simultaneously so as to create a stronger, less susceptible plan for driving new business through the door. Therefore, like a Parthenon structure, a business has multiple “pillars” holding up its’ roof. In the club business the “pillars” to the marketing Parthenon I teach have always been External Marketing, Internal Marketing, Guerrilla Marketing, Corporate Marketing and Community Outreach. Of course, within each of these pillars, a club can do a whole variety of specific marketing strategies.
As a result of our newest discovery, HEALTHY INSPIRATIONS has now added Retention as a 6th pillar to our marketing plan. We feel that doing this will force us to stay focused on the issue of retention every single month, and give it just as much importance as we do to all our other marketing efforts. The remainder of this article will be dedicated to discussing the various retention strategies we are employing at our Centers and the initial impact they seem to be having.
Assuming that the premise “usage = retention” was correct, our team set out to think of ways that would entice members to use the club more often. Something we were fairly certain of was that members wouldn’t use the club unless one of two things happened; either the member was having fun or they were getting results. Without at least one of those two things, it is understandable why a member would quit. Therefore, we attempted to brainstorm ideas that would make coming to the club more fun and hopefully in the process give members better results.
The first program we created was Success Steps. Because HEALTHY INSPIRATIONS is in the weight loss business, many clients come to a Center with a considerable amount of weight to lose. Unfortunately, many people have a challenge staying focused on a long-term goal and drop out when they lose motivation. Success Steps is a program that allows clients to break their weight loss goal into 5 incremental steps; 20%, 40%, 60%, 80% and 100%. As a motivator, clients are given small incentives to reach each step. For example, when they reach 20% clients get a cool club T-shirt. At 40% they might get a box of protein supplements. At 100% they will get a free microdermabrasion treatment. Upon joining the program, each client is sent home with a Success Steps paper that outlines for them the amount of weight they need to lose to reach each step and informs them of the prizes they will earn.
As an additional way to keep the client motivated, each Center has placed a large Success Steps Board in the fitness area that visually tracks each client’s progress. (See inset.) At the beginning of their program, the client is given a small magnetic strip to write their first name on. The client then is brought to the Success Steps Board and physically places their name in the start column. As each mini-goal is reached the client enjoys a celebration with the employees then is allowed to move their name into the next “step” and reap the benefit of their incentive.
Members’ response to the Success Steps program has been overwhelming. For one, members are able to stay more focused because their goal is broken into more realistic increments that can be reached in shorter terms. Next, the members stay motivated with incentives that they want. In addition, having a client be the one to move their name at each step in the process helps to reinforce their decision to improve their health and physical well being. And, as an additional benefit, the Success Steps Board helps the selling process because it projects a level of social proof to prospects, showing them that “all these people are succeeding, so can you.”
The second retention program the team created is called Healthy Rewards. Where the Success Steps Board is specifically designed to keep new members motivated while they are reaching their weight loss goal, the Healthy Rewards Program was designed to keep any member motivated regardless of how long they have been at the Center. How the program works is that at the beginning of every month, members are given a small card, which tracks their number of workout visits (similar to a frequent coffee card). When the member has worked out a total of 12 times in one calendar month, they turn their card in and receive a coupon for a discount at a local business, who is sponsoring that month’s prizes for the program. Typically the sponsoring business gives one grand prize (valued at $50) and unlimited discount coupons (usually for 10% off their product or service). All cards that are turned in for the discount coupon go into a large raffle bin and on the last day of the month a drawing is made for the grand prize.
Like the Success Steps Program, Healthy Rewards has been given high marks by the members. In fact, members want to know months in advance who the Healthy Rewards sponsors are and what the prizes will be. Some members even make suggestions and establish the contacts with interesting local businesses. Of course, from the Center perspective this is a wonderful program because members must average three workouts per week in order to get the reward. Usage, usage, usage! As an additional bonus, the program allows the center to establish 12 joint marketing relationships that can be extended throughout the entire year, not just the month of sponsorship. Whether it be a coupon exchange or something more direct like a lead box program, this results in a retention program that also drives in new prospects to the Center.
Where both the Success Steps Board and the Healthy Rewards Program are on going, the third program we implemented is called the STAR Member Program. This program was the brainchild of our Ormond Beach, FL franchise and is designed to used during a slower time of the year to encourage usage. How the program works is that members are given a goal or obtaining a certain number of “Stars” over the program time, which we made 2 months. Stars are nothing more than either stickers or an ink stamp that is placed on a special attendance card. Members earn stars for a variety of things; workouts, attendance to educational seminars, participating in group exercise classes, bringing a guest and referring a new member are just a few examples. When the member achieves the necessary number of stars, they earn a very cool “Star Member” T-shirt. Of course, these T-shirts are displayed prominently in the Center and are not for sale or distribution for any other purpose than the Star Program. This creates excitement and a sense of urgency to earn stars as quickly as possible because we tell members there are a limited number of shirts.
Although it is the type of thing you would only run once or twice a year, our members love the Star Member Program. For one, a member will do almost anything to get a free T-shirt. The fact that the shirts are kind of cool and attractive was definitely a big help. A second reason, which goes directly to a point made earlier, is that (most) people need to be having fun to continue doing something. There are only so many different ways to spice up a workout so by giving the member a game to play as a motivator it brings a new level of excitement to the Center.
It may be too early to provide exact statistical information as to any potential increase in member retention, there is no doubt that these three programs are creating both fun and an increase in “conscious usage” at the Centers. That is, members are using the club with the conscious attempt at reaching a certain number of visits because it will mean a benefit for them. And, by making retention part of our annual marketing plan, our Centers will be more apt to make a continued, consistent effort at finding new and unique ways to motivate members to use the Center more often. In the end, if our premise that “Usage = Retention” is correct, this should mean more members in the long run.