If you think your biggest expense is payroll, which is what I often hear when I ask fitness facility owners and managers, you’re mistaken. In my experience, attrition—the number of members lost compared to the number of members overall—is the real financial sinkhole. When I ask people what their attrition rate is, they tell me they’re losing an average of 30%–45% of their members each year. This means, in theory, that in a 3-year period their entire membership is turning over. If you calculate the dollar value per member based on the average tenure, you get the value of attrition—and, in most cases, you see how expensive it is.
Some attrition is uncontrollable: clients experiencing financial issues related to job loss, moving outside the area or leaving for medical reasons. Most attrition, however, is within your control. You simply need to ensure that patrons are using your services and programs and getting good results. When members want to quit, you are gifted an opportunity to re-engage them and help reset their paths.
Getting a customer to use your services sounds simple, right? Let’s say that members who use a business 100 times or more per year are “core users.” From my experience, most fitness businesses are unable to count more than 65% of their customer base as core users. Why? Because of a lack of three critical elements: integration, customization and ongoing engagement.
People buy a service or program because they think it will take them from where they are to where they want to be. Every person is different. Therefore, to determine how you can help members stay active, you must find out what they need, what they like, what results they want and how to achieve those results. You must recommend or customize a program for them, and you need to motivate them along the way. If they give up, you need to re-engage them, regroup and change course.
One way to do this is to monitor attendance. The moment that members stop being core users without an explanation, contact them and involve them in a process of reassessment and goal-setting. Call members who haven’t used the facility in 30 days—don’t ever let them get to 60 days!
Habits don’t form overnight. You’re in charge of helping members create an exercise habit. You are the expert. When members join, inform them that the first 2–3 months of their membership may be not only the hardest, but also the most critical to their long-term success. Sit down with them, grab a calendar and map out each visit for the first 30 days. Be an active exercise-habit leader. Stress to members how important these appointments, similar to doctor’s visits, are to their wellness and overall success.
Results are closely tied to usage, and they are equally important. Do not presume that members know they’re succeeding. Record their desired results at the outset, and monitor their results over time. If you can’t prove to your customers that they are succeeding, they may quit. Show them their work, even if the results aren’t what they want. Encourage, motivate, and offer practical steps forward.
Positive retention results will come from integrating members and keeping them motivated and active. However, sometimes you can’t convince someone to stay. When this happens, conduct a proper exit interview. If this is done correctly, you may be able to salvage a relationship. And if members don’t change their minds now, this interaction may help them decide to return in the future.
For questions to ask during an exit interview, as well as more tips, please see “Attrition: Your Biggest Business Expense” in the online IDEA Library (July 2013 issue of IDEA Fitness Manager). If you do not receive IDEA Fitness Manager and would like to, please contact IDEA’s Inspired Service Team at (800) 999-4332, ext. 7, or (858) 535-8979, ext. 7, for more information.