As a fitness business owner, increasing membership prices can be extremely intimidating, risky, and demoralizing. We know you don’t want to have to raise your prices because you love your members and don’t want to take a chance on them leaving your gym and joining another. The U.S. fitness industry lost $20.4 billion in 2020 and, according to a Club Intel survey, 60% of respondents have not returned to a fitness facility. Fitness business owners are struggling and need to raise prices in order to keep their clients fit and happy.
If you anticipate needing to increase your membership rates in the near future, keep reading to learn more about our top 3 tips on how to avoid backlash when raising your prices.
The most predictable part of being a fitness business owner is the New Years Resolutioner rush come January 1. You might be thinking this would be the riskiest time to increase prices, but to contrary belief... it’s actually the best! According to a 2017 survey by the International Health, Racquet & Sportsclub Association, 10.8% of 2016 gym membership sales took place in the month of January. This concentration of membership purchases in January continues to be a trend each year, therefore, it is the most optimal time to increase your prices due to the number of new clients likely to join your facility at this time.
Since potential clients are so focused on their New Year's fitness goals, they will be much more likely to focus on how your business can help them achieve their goals, rather than what you’ll charge.
According to a study by Mckinsey, 70% of fitness consumers report missing their gym as much as they miss family and friends. A fitness space is not home, and it is not work, but it can be something called a “Third Space”. For most people, a fitness facility is more than just a place to workout, but it becomes a place where they feel supported by a community to grow and achieve their goals.
If you can create a culture where your clients feel like they are paying for a community, rather than a few pieces of equipment they don’t have at home, they will value their membership more than however much you increase membership prices by.
One way to help clients commit to your business and overlook the price increase is by implementing performance tracking. This solution is two-fold: 1) performance tracking signals to your clients that your facility is serious about helping them reach their goals, and 2) tracking performance results allows clients to support one another and foster a tight knit community. Once establishing goals and a community within your fitness space, the switching cost for a client will likely be higher than the increase of cost in their membership.
Learn more about performance tracking with Wodify here.
Like the Mckinsey report noted, your business can become a home to many clients. The feeling of walking into your business and receiving a warm smile and “Hello Meghan”, high fives during a workout, and an instructor helping you set a new goal as you reach the previous one are the small moments that will increase your client’s loyalty and decrease backlash on price increases.
The final point of safety is crucial, especially in this day and age. Since fitness facilities were forced to close in 2020, data shows Millennials and GenZ are the least likely generations to return to their brick and mortar facilities. This means most likely to return are GenX and Boomers, which are also the generations that are most susceptible to COVID-19 and other injuries. If GenX and Boomers are the clients returning to your facility and they understand your membership prices are increasing because you are investing more in health and safety precautions, they are less likely to cancel because you’re investing in what they value.
By implementing these 3 strategies when considering an increase in membership prices, you can also increase the likelihood of client retention while decreasing overall backlash.
If you would like a no-pressure software consultation with someone from the Wodify team to discuss more about performance tracking, you can book a call here. Hope to talk to you soon!