State of the Fitness Industry: An Analysis of Member Behavior

For Gym Operators

State of the Fitness Industry: An Analysis of Member Behavior

The fitness industry is constantly changing, and key to understanding that change is collecting data.

Only by using data can operators make evidence-based decisions to ensure they are moving their business in the right direction. For this reason, it's critical that clubs analyze their members' behaviors, preferences, and grievances in order to survive in the evolving fitness industry. This article covers a few critical pieces of information that explain how member expectations are changing and how operators can react.

The following is a summarization of an education session from the 2015 IHRSA Convention, produced with full permission from IHRSA. The full-length video is available for purchase at ihrsastore.com.

About the Speakers

Phil Bonomo is the Director of The Retention People, North America. He has over 25 years of experience in the fitness industry.

Mike Hills is the Global General Manager of The Retention People. He has 20 years of experience in the health and fitness industry and oversees software delivery and other services to more than 1,000 health clubs globally.

About the Company

The Retention People (TRP) provide tools to improve retention rates in fitness facilities. The company surveyed members in America and the United Kingdom. They have presented their findings from the last two years in partnership with IHRSA. The surveys aggregated information about what members want, what they do, and how change can result in longer member retention.

Shaping the Industry through an In-Depth Analysis of Member Behavior

Why Do We Need to Understand Member Behavior?

Tracking common member behaviors enables facilities to meet and exceed member expectations.

Past lessons refine future conduct and member behavior is the key to retention. Evolving within the industry is vital, primarily because competition is fierce and the demand for fitness services waxes and wanes. Awareness of current trends and behaviors is a necessity. As an operator, it’s all about sustaining market share; keeping your members happy, healthy and engaged; and getting more members through the front door. If you can understand how members think in relation to your facility, you will do a better job in keeping them.

Meeting Expectations

When a member comes into your facility, you usually present a compelling sales pitch or promise them things your facility will deliver. Unmet expectations result in a disconnect. Set expectations at the point of sale that can be met throughout the member journey.

The past impacts the future. Think about how you operated years ago and compare it to today. There is a difference in operations. Everyone in the industry has dramatically changed the way they do business. The industry has evolved from an industry focused on the sale to an industry focused on relationships with people. Spend as much time and effort on your ability to retain members and keep them committed to you and their programs as you spend on the sale.

“Retention is not simply one more operating statistic. Retention represents a central gauge that integrates all brand dimensions, measuring how well the firm creates value for its customers ... It is the single indicator for measuring sustainable growth.” - Frederick Reichheld

IHRSA/TRP North American Member Loyalty Study

This study was loosely based on the book, The Ultimate Question by Frederick Reichheld. Is there a survey that can generate the best feedback from customers without turning them off?

The survey included 100,000 in conjunction with IHRSA. Members in IHRSA clubs were asked, on a scale of 0-10, how likely they were to recommend the facility they attend and why. The score is then broken down into three sections: people who ranked their experience from 0-6 are known as detractors; 7-8 are fence sitters, or position-neutral, and 9-10 are promoters or raving fans. The objective of the survey was to monitor the current market, as well as look at past patterns. The end goal was to move everyone up the scale to raving fans. The idea of a net promoter score is not meant to take a pulse of the current business, but to work as a tool for constant improvement.

2014 NPS Benchmark Leaders

Peter Welch’s Gym

  • 89 percent USAA - Fitness
  • 81 percent USAA - Financial Services
  • 81 percent USAA - Banking

Current North American Member Loyalty Benchmark

  • 102,787 Responses
  • Overall average score - 43 percent
  • Highest score (owner operated) - 89 percent
  • Lowest score (PRC, Unity) - 37 percent
  • Average (OOSS) 53 percent
  • Average (OOMS) - 34 percent
  • Average (large chains) - 14 percent

Reducing Cancellations and Keeping Members

The single biggest factor in reducing the risk of cancellation is making friends. Connect with your members to create a culture of community and friendship within your facility. A sense of community reduces the risk of cancellation by 40 percent.

TRP conducted an online survey addressing member experience, history, motivation, likes, and dislikes. The survey was conducted in the UK and was completed by 10,000 members.

The survey evaluated member motivation, what was important to them, and how much progress they'd made within the last three months.

The most important and motivational factors to members were:

  • Making friends
  • Attending clubs as often as planned
  • Being healthier
  • Improving muscle tone
  • Enjoying exercise
  • Losing weight
  • Feeling fitter

Highly motivated people who do NOT obtain results have the highest risk of cancellation. What does this mean? Although the fitness business is traditionally about the physiological benefits of exercise, the key to providing motivation is to create social connections, emphasize fun and friendliness over fitness, and to be realistic.

The Importance of Group Exercise

According to research, participating in group exercise reduces the risk of canceling by 26 percent, regardless of age, gender and membership type.

The survey indicated that new members and young males were not keen on group exercise. How do you encourage these members to participate? Explain that they are more likely to be successful if they join fitness classes. Give passes to friends for group exercise so your members do not feel intimidated by not knowing others in the group.

Members' Top Annoyances

The number one annoyance among members was queuing for equipment, which increases the risk of cancellation. The annoyance associated with queuing was 80 percent and higher. Young male members represented the highest level of annoyance.

Fitness staff not speaking to members was a close second and was the cause of a 72 percent cancellation risk.

What Makes Members Happy

  • Reception staff talking and engaging with them
  • Making friends
  • Fitness staff engaging with them
  • Receiving encouragement from fitness staff

It is important to understand different groups of members and how they interact with your facility. Target them with a specific solution, such as talking to them, explaining the benefits of using your facility, and reassuring them.

The main takeaway from this survey is that you and your staff should talk to members! Forge relationships and rapport. Make members feel engaged and appreciated and you will increase retention. Talk is valuable, so if you shift the paradigm and focus on the individual member, you should be able to improve results in your club.

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