A Fee-Based Program Primer
Consider the many benefits and opportunities in offering members programs for a price.
In the world of wellness and fitness programming, the days of all-inclusive services and programs are numbered. Thanks to the recession, fee-based programming has become increasingly valuable. Our industry has encountered the same financial challenges as other industries, and fee-based programming is part of our new reality.
For a program director it is important to know the basics of this type of programming, with an eye toward incorporating special events into your facility’s schedule. This article will highlight the benefits of fee-based programming, outline steps to implementation and offer successful examples.
Know the Benefits of Fee-Based Programs
Why bring fee-based programs into your facility? The reasons are many.
Retention. Programs create commitment and accountability, which increase retention. Having to pay for programs further enhances members’ commitment. If the program is free, generally the commitment and “stickability” are not as strong.
Member Satisfaction = Renewals + Referrals. With a financial commitment to fee-based programs comes increased attendance, which leads to better results. When members get results—which they expect—satisfaction improves, and so does retention. When members are happy, they tell others, which generates referrals and is a great business strategy.
Revenue Generation. Fee-based programs offer more structure than drop-in programs. You can include pre- and post-program assessments, an orientation, class evaluations and a structured learning environment. All these elements increase the possibility of win-win scenarios. Instructors have a better chance to make a real difference over an 8- to 12-week program with a select group of members, and members are guaranteed results. Management is also more likely to meet its financial goals and objectives if members are getting results and spreading the good news!
Improved Member-Member Relationships. Member-to-member relations are arguably a more critical factor in retention and member satisfaction than member-to-staff relationships or member-to-equipment satisfaction. Fee-for-service programs bring together members of like minds and similar goals over a set period of time to work out, hold one another accountable and offer support in attaining goals. All of this translates into new friendships. These relationships are pivotal in increasing the membership lifespan.
New-Member Integration. A core member visits your facility about 100 times per year, give or take. If you create experiences that quickly engage people, you retain them. Fee-based programs create opportunities for new members to become part of your health and fitness family, their “home away from home.”
Member Lifecycle Longevity. One of the goals of unique services is to add value. With fee-based programming, you create “seasons of value” that can increase the member lifecycle. Create a calendar that goes beyond 1 month or 4 seasons at a time. Think of retention as longer than 12 months; think 18 months and beyond. Prepare experiences that build on one another to keep members involved over the long term year after year!
Staff Talents and Expertise on Display. Fee-for-service programs are a fabulous way to showcase the strengths of your staff. When leadership is demonstrated in this way, stronger bonds forge between members and staff, and among staff, across the board. Strong team dynamics and mutual respect across departments are motivational for all involved, including members.
Now that you understand the many benefits of fee-based programs, here is an entry point into the game. Simply create programs that members need to have versus ones that are “nice to have.” Often the greatest programming ideas come to light when existing members express their needs. Following are some examples from my own experience:
Outdoor Riding Skills. Our avid indoor cycling participants voiced interest in learning how to ride outdoors. Several of them bought outdoor bikes, having felt a sense of accomplishment in indoor cycling classes. However, they didn’t know anything about riding safely outdoors, so they asked if we could teach them the rules of the road. Several of my teachers are avid road cyclists, so this was an easy request to fill and created a new fee-for-service program based on member need.
Learning to Run. Many of our personal training clients requested a running program so they could learn how to run their first road race, which can be scary. This was another perfect opportunity to offer a fee-based program based on client needs.
“Knee Hab” Class. Last year we integrated phase 3 and phase 4 cardiac rehab clients into our wellness center. This group was very structured in its exercise routines, and the clients were conservative with their choices of exercise, including group fitness classes. However, this year we launched “Knee Hab” for people like these with knee issues, and it has been very successful because they like the structure. Cardiac rehab “graduates” often have joint-related problems.
Nutrition Classes. Members always want more information about nutrition and constantly ask for educational opportunities. To address these requests, we created fee-based Lunch’n’Learns and evening talks with registered dietitians.
Women’s Self-Defense. We regularly get requests for self-defense classes. Consequently, we offer an annual class with a trainer who has a martial arts black belt. This creates cross-promotional opportunities for him to sell his services as a personal trainer, which ultimately impacts our bottom line.
Tai Chi. Requests for tai chi classes have tripled in the last couple of years–rising so fast that we knew we could offer classes for a fee and members would pay. Any meditative, stress-reduction class is highly marketable and in great demand right now.
De-stress Yoga. Many of our members expressed a need for a Friday afternoon opportunity to unwind from their workweek. We heard this feedback repeatedly through member comment cards, surveys and e-mails.
Menopausal Overweight Moms Session (MOMS). This program came from a member who wanted her co-workers to experience what she did when working out with her personal trainer. She got four peers together, and we offered the program for a price.
Implement Your Ideas
So we know that there are benefits to offering fee-based programs and that getting started may be as simple as listening more intently to members. Implementation is the next step. Here are some basic steps to follow:
- Conduct a needs analysis.
- Identify a leader or champion to sell and teach the program.
- Decide on a program goal and fee.
- Set minimum and maximum registration numbers.
- Address safety concerns.
- Identify prerequisites.
- Start with new-member integration.
- Plan the program format and content.
- Decide on space and equipment.
- Develop a marketing strategy.
- Perform pre- and post-program health assessments.
- Set goals.
- Outline clear policies and procedures.
- Implement the program.
- Evaluate and re-evaluate.
- Refine, redefine and redeliver.
We have developed a pricing strategy that is based on fee per contact-hour of instruction. The hourly fee for most of these programs is cheaper than for one-on-one personal training, but more expensive than for group training. Typically a member will pay $20 per contact-hour of instruction, and a nonmember will pay $25 per contact-hour of instruction.
Below are two examples of fee-based programs we successfully implemented in our facility:
Live Light. This 8-week program typically results in an average 4- to 8-pound loss per person. The program is targeted to individuals and includes
- pre- and post-program assessments, including blood work;
- weekly weigh-ins;
- nutrition and exercise components;
- supervision by a registered dietitian; and
- facility membership for the class’s duration.
Fee: $200 per person for 8 contact hours, 1 hour per week for 8 weeks.
Great Weight Challenge. This 8-week group, which typically results in an 8- to 12-pound loss per person, offers
- a team-based approach;
- weekly weigh-ins;
- nutrition and exercise components;
- a knowledge, skills and attitudes questionnaire to measure changes in learned lifestyle behaviors; and
- prizes based on the percentage of body weight lost.
Fee: $500 per team, with a minimum of 10 participants committed to the challenge.
Take another look at fee-based programming as a way to recession-proof your operation. These monetary offerings increase retention and member satisfaction while improving relationships and generating ancillary revenues. A strategy that supports members in their health, fitness and wellness journeys while helping you attain fiscal goals is a good strategy indeed.
Consider the following when designing your “pay-to-play” programs:
- Ask for payment in full at registration.
- Require waivers and consent forms.
- Clearly outline the substitution policy.
- Do not offer makeup sessions or allow cancellations.
- Stick to class limits; do not exceed them.
- Set a firm policy around late arrivals.
- Consider late registration.
- Make the initial orientation mandatory.
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