Like I’ve mentioned before, the fitness center market is highly competitive (as if you didn’t know that already). To gain any leverage in the marketplace you have to be extremely creative in the way you attract new members. I’ve developed some enticements for members by experimenting, building on what works and letting all the rest go.
Gym Membership Management With Self Service Marketing
There’s one promotion that’s worked particularly well over the years. I let members work for discounts on their monthly rate by bringing in referrals, down to a certain amount. It works like this: my monthly membership amount is $34.50. I then allow a $5 discount to be deducted from their monthly membership rate, for every additional person that they refer down to $19.50.
The way that I structure it is that the new member referral must sign up at the full rate. If they don’t want to put in any effort that’s fine, it’s still a competitive deal. But, with a little effort, they can also earn their way down. This gives every member in the scheme an incentive to bring in up to three friends, who, potentially, can then each bring in three friends and so on.
What Is It Gym Members Really Buy?
This is built-in marketing, where the clients do the promotion and sell memberships. Referral prospects come in ready to join. They are pre-sold because of a simple principle of sales that network marketers have known and relied on for years.
People are much, much more willing to buy something from someone they know, like and trust. Why don’t you buy from someone you don’t like? It would most likely be that you don’t trust them to give you a fair deal. Decisions to join based on the recommendations of friends overcomes that hesitation, without it even being an issue.
Earned Discounts Beat Freebies Any Day
One of the biggest benefits to fitness center owners and managers is that there’s no money out of pocket for the gym with the $5 discount promotion. Let’s compared that to a free month at the start of a membership promotion where the first month comes out of your pocket. The payment is made up front and discounts are applied over time, as other (paying) members join. No money out of your pocket.
You’re trading a fraction of one revenue stream for full new streams. Which can lead to further revenue streams recursively. In the simplest terms that means a huge potential for exponential growth. It may or may not take care of all of your marketing, but since it’s so highly leveraged, it means a huge savings on marketing by the more traditional means.
The Hidden Advantage
There is another aspect to this. The type of person who drives this sort of promotion is sociable. The $5 discount tends to attract friendly, extrovert clientele. People who like people and whom others like to be around. That’s a formula for a great atmosphere.
Referrals bring in new members based on social proof. People who like the people who invited them to join are going to be less hesitant to participate. They’ll be more comfortable the first few workouts, which means they will be more likely to extend their memberships and work to get the discount by bringing in their own friends.
Holding On For The Long Run
If you are faced with objections and a potential cancellation, you can point out that the member worked for this great price. They’ve made an emotional investment as well as the effort to convince friends and family to join up. If the member does leave anyway, offer to give their price to another family member or friend. That way there is no loss. The discounted membership gets passed on and you maintain the income.
Retention of members is crucial to long-term success. The $5 discount is a fantastic tool to increase retention. The fact that members have to work for their discount means that there’s a tremendous buy-in. It will help you to maximize your profitability and create a sense of participation for your members. That is a win for everyone.
Over to you…
Have you tried self-service marketing at your fitness business?
What has been your most successful promotion for maintaining consistent recurring membership dues?