The Ultimate Guide To Developing A Winning Membership Retention Strategy For Fitness Clubs

Did you know that 80-90% of people quit the gym within 3-months of joining?

Not just that, it has been found that the cost of acquiring a new member can be up to 10 to 25 times the cost of retaining an existing member!  No wonder that most successful fitness club owners invest a lot of time, energy, and effort in retaining their members. In fact, a well-executed member retention strategy can boost your sales by as much as 95%. So, let’s have a look at why members quit and how successful fitness clubs can curb the attrition ratio.

Why Do Members Quit?

The first step towards plugging the member attrition is to understand why it happens in the first place. What could drive a motivated member who has paid a significant sum to follow their fitness journey to suddenly give up? There are a plethora of reasons why someone might decide to stop coming to your gym. Some of the most common reasons are –

• A lack of tangible progress
• Loss of motivation
• Dissatisfaction with the service
• Overcrowding
• Hike in the membership fee
• Plain boredom

Most of these issues can be easily addressed by fitness club owners by adopting some of the industry best practices and good club management software. In fact, as we will see, an all-in-one club management software like Traqade can go a long way in streamlining a lot of issues and help you raise your retention rates significantly.

Metrics You Need To Know – Member Retention Rate

Metrics form the core of any business strategy and help business owners gauge the effectiveness of the strategy. When it comes to fitness clubs, the key metric to focus on is the ‘Member Retention Rate’. Here is a handy formula that can help you calculate your fitness club’s annual member retention rate quickly.

Annual Member Retention Rate = ((Members At The End Of Year – New Members Acquired In The Year)/(Members At The Start Of The Year)) x 100

Note: According to IHRSA’s report published in 2013, the average membership retention rate in the fitness industry was pegged at 66 – 70%. If it’s below that, the churn rate is considered to be high.

3 Successful Strategies Fitness Clubs Use To Retain Members

1. Use Technology To Deliver A Personalised Experience

In today’s world, personalisation is the key to member retention. Be it offering them personalised communication or understanding their motivations and creating a personalised fitness plan to help them achieve their goals. One of the basic steps towards delivering a personalised experience is by personalising any and all communication to your members. Be it emails, SMS or welcome kits, each small step towards personalisation makes your members feel instantly welcome and valued.

A truly personalised experience entails knowing your member’s preference, behaviour and tailoring the communication of their specific need. When you add a personal touch to the communication, you are developing a much more engaging and meaningful relationship with your members which in turn translates into enhanced member loyalty. Personalised communication is also the best way to grab your audience’s attention in today’s digital world which is cluttered with ads from your competitors.

2. Build A Member Community

Humans are first and foremost social creatures. Not only does this tenet hold true in daily life, but it is also applicable to all other activities including fitness. For example, an industry report found that members who workout individually with very little social interaction were at a 56% higher risk of dropping out than those who attend group classes.

Another report showed that 70% of all members who made new friends at the fitness club not only saw a marked improvement in their own fitness, they were also less likely to skip classes and more likely to recommend their fitness club to friends and family.

Building a supportive community in your fitness club also has a significant impact on the overall motivation level and accountability of their members which in turn has an extremely positive impact on the member retention rate.

One of the best ways to build a member community is through group classes. It also greatly enhances member retention. A study by Nielsen of over 3000 group class participants across the world proved this. The report showed that of all the participants, “more than 85 per cent of class members visit their facility twice a week specifically to engage in group classes” while “43 per cent of members visit their facility four times per week for this purpose.”

However, managing group classes has its own set of challenges like scheduling classes, tracking attendance, communicating the schedule with your members and managing roster for the trainers. While manually this might get very complicated and confusing, club management software like Traqade has simplified the whole process of group class management thus allowing you to deliver the best experience to your members.

Besides offline activities, fitness clubs should also strive towards creating an engaging member community online. Social media provides the perfect platform for this purpose. Putting up weekly challenges and publishing the names of the winners, posting before and after of willing customers’ transformation pictures and sharing motivational stories are just some of the ways in which fitness clubs can bring together and motivate their member community.

3. Pay Attention To Warning Signs: 

Members do not just quit their gym overnight. There are enough red flags along the way leading up to the cancellation. Here are some of the most common signs fitness club owners and managers should pay attention to if they want to cut down their churn rate.

a. Declining Attendance: One of the most effective indicators of whether a member is about to quit is to observe their attendance track record. Generally, most fitness clubs agree members who have not attended the gym in more than a week are most likely to cancel their membership.

How To Tackle It: Ask your staff to pay extra attention to these members. Every two interactions with your training staff can result in one extra visit from the member in the following month. Every additional visit by a member cuts the risk of attrition in the next month by 33%. You can also offer them free personal training sessions or group classes to get their motivation up again.

b. Complains Regularly: If a member seems to be consistently unhappy and complains about increasing frequency, there is a very good chance that they may consider cancelling their membership. Worse, these members can also turn into vocal detractors who are very likely to spread a negative word about your fitness club.

How To Tackle It

If the frequency of complaints keeps increasing, it may be time for the fitness club owner personally to check on the matter and solve it to the best of their ability or offer an alternative solution. Not only will a timely resolution help you plug the churn rate, but by involving yourself personally you are also building a close relationship and sending a positive message that you truly care about their well being and turn the member in a “promoter” for your fitness club.

c. Workout Partner Cancelled Membership: We have already talked about the important role relationships play in member retention. When a member’s longtime workout partner cancels their membership, there is a fairly good chance that they may follow suit.

How To Tackle It

Unlike the above two scenarios, this one is a little tricky. This is where your personal relationship with the members can help. One of the best things to do is to reach out to the member personally and understand how their comfort level has been affected by their partner’s exit. You can also ask your fitness trainers to pay a little extra attention to the member in question and see if you can introduce them to an alternative workout partner.

d. Delay In Paying Renewal Fees: Sometimes members drop out due to financial constraints. If a member has been defaulting on their renewal, there is a very good chance that they may drop out over the next few days.

How To Tackle It

Offer your members flexible payment options and easy interest-free instalments. By dividing your membership fee into 2 or 3 instalments, you will remove a considerable constraint for your member and significantly reduce the risk of them dropping out. Club Management Softwares like Traqade come equipped with flexible payment options and allow you to divide your membership fees into equal instalments in a jiffy. Furthermore, Traqade also sends automated reminders to the members when their next instalment is due making it an extremely convenient option for both your business as well as the member.

Bottomline

As we have stated in the beginning, the cost of acquiring a new member is far more expensive than retaining an old one. However, once you understand and address the reasons for attrition, not only will you increase your ‘Member Retention Rate’, you will also create happy customers who will give you repeat business and also act as your brand ambassadors.

Lastly, one cannot ignore the role technology can play in mitigating the attrition rates. In fact, Club Management Softwares like Traqade is the perfect tool which can help fitness club owners combat member churn rate like nothing else. Want to install Traqade? Signup for a Free Demo now or you can contact our team on 080-470-91930 or email us at contact@traqade.com.