A Guide to Developing a Winning Member Retention Strategy

By Steven Ecott

Published 15 February 2018

Membership management. The lifeblood of any gym.

But once you’ve welcomed members into your gym, that’s the hard part done. Right?

Gyms are no different than other businesses in the service industry. Your ultimate goal is to keep members happy, and your gym bustling year-round. Enter, the age-old challenge of member retention. Thankfully for you however, we’ve created a guide to help you set up a solid member retention strategy.

Why Is a Member Retention Strategy a Big Deal?

It’s simple:

Member retention affects revenue. Increasing your member retention rate by only 5% can boost cash flow by up to 95%. It makes sense; you spend less time and money on recruiting new members, and focus on the ones you already have. Because you’re spending less on acquisition costs, you can free up significant sums of cash.

Plus, members you manage to keep for long periods of time are likely to spend more money with you, and refer your services to friends. So, when it comes to strengthening the financial prospects of your business, taking retention seriously is crucial. Our long-term client LIJFSTIJL Coaches boosted their retention rate by 88% by integrating their own member retention strategy focusing on maximizing client-contact time. The effectiveness of a well-planned member retention strategy cannot be understated.

Step 1: Know Your Metrics

Gym membership retention strategies can be as thorough as possible, but if you have no metrics to measure them against, you’ll be struggling to calculate their effectiveness. So it’s important to understand exactly what attrition and retention are before you can focus on finding the ultimate solution.

Attrition

Simply, attrition is the loss of members. On average, 50% of people who start exercising drop out within the first 6 to 12 months. All service industries can (and will) experience member attrition, but reducing it is the end goal of all gym membership retention strategies.

Once you’ve got to grips with attrition. It’s time to take a look at retention

Retention

Retention is why we’re all here, and making it as high as possible is the end goal of any member retention strategy.

Calculating your member retention rate is a crucial step in forming your retention battleplan. Without it, you’ll struggle to monitor the effectiveness of anything you roll out. To calculate your member retention rate, follow this formula:

((Members at end of period – New members acquired during period) x 100
((Members at start of period))

This formula will deliver your retention rate for whichever period of time you choose. Let’s take a look at an example for a period of 12 months:

Your gym starts the year with 240 members, and get another 200 sign-ups over the course of the year. But you end the year with only 320 members. The formula would look like this:

((320 – 200) / 240)) x 100 = 50% annual retention rate.

Once you’ve calculated your member retention rate, inventorize the reasons members recorded for leaving, and their demographic. This will help build a greater picture of whom your facility appeals to, and who is being driven away. When it comes to creating a member retention strategy, this is invaluable information.

Step 2: Know Why People Leave

People can leave for a manner of reasons but usually, it’s because of something that can be controlled by you. After talking with our clients, we found the that memberships were canceled for three main reasons:

No engagement

It’s important to remember that members aren’t just customers, they’re a part of your gym community. If they don’t feel at home, they aren’t going to stick around for long.

No motivation

A lack of motivation can be killer in all works of life, but especially in the gym. If somebody starts to lose the desire to sweat it out regularly, they’ll naturally reconsider their membership.

No money

Financial restraints mean cutting down on luxuries. This often means that the gym membership is one of the first things to be axed, especially if it isn’t being used regularly.

Woman in Group Class

Step 3: Fixing Common Drop-Out Reasons

We’ve gathered a range of effective, industry-tested gym membership retention strategies to help reduce member churn, and create a healthy environment for members to enjoy and flourish in.

Retention Tip #1 – New Member Onboarding

Setting new members off on the right foot sets a precedent for what they can expect from their time with you. A warm welcome, guided tour and induction session are the hallmark of a gym that cares. If new members enjoy their first experience of your facility and feel at home there, they’ll be more likely to stick around. In fact, one of our clients, FemmeGym, developed a strategy focused on a simple, accessible onboarding process to boost member acquisition by 80%. Their retention rates rose considerably due to the client-focused direction that their business took as a result.

Retention Tip #2 – Build a Community

Becoming part of a community is something that many members want to experience when they join up. Working out in your gym should be like working out with friends. It’s easy to negate the idea of community with the thought that ‘people are just here to work out’, but in reality that’s not always the case. There is a huge social element to the gym environment and nurturing it is crucial to harnessing the power of the community. People will be much less likely to leave if they can call their fellow gym-goers friends. After all, who doesn’t enjoy seeing friends?

As Cornee van Ewijk from Cosy Sport, says: “Keeping clients happy starts by getting to know them.” Remembering and highlighting milestones show that you care about more than just your client’s BMI. The client relationship should exist outside the gym as well, whether it be for individual chats, group conversations with other gym members, a Facebook group, or specialized member engagement software.

Gamification

Retention Tip #3 – Motivate with Gamification

Introducing challenges into your gym are a perfect way to promote engagement and communication with your members. The beauty of challenges is that they come in all shapes and sizes: How fast can you run 10km? How long does it take you to climb the 1,710 steps to the top of the Eiffel Tower? A solid member retention strategy would be implementing week or month-long challenges into your facility. Challenges offer the chance for members to motivate each other, get more out of their workout and truly appreciate the value of your gym.

FREE EBOOK

Motivate Your Members with Gym Challenges

Add fun and play to your gym’s services and check out our step-by-step guide to implementing fitness challenges.

Retention Tip #4 – Financial Flexibility

As mentioned earlier, gym memberships are often victim to culling when it comes to members assessing finances. Monthly costs may be too high, contracts too long or not enough value in the investment. Money is a sensitive issue, but offering a variety of options to cater for each budget can help keep a member onboard for longer. Offering annual and monthly payment plans can encourage your members to commit to a contract, however their financial situation allows.

Retention Tip #5 – Group Classes For The Masses

Laying on group classes is a worthy solution in itself, the benefits of collective exercise are well documented. From increased social interaction with other gym-goers and motivating each other, to a healthy bit of competition, group classes are capable of engaging members in multiple ways.

Whether it’s spin classes or HIIT group sessions, the idea of a group class is as flexible as it is effective. Diverse group classes are perfect to implement in member retention strategies for businesses of all sizes. A great example comes from our client Sportclub Exercise, who noticed a 27% increase in group class bookings when they integrated a member retention strategy into their club. They were able to introduce a service that simplified the booking process, and encouraged more of their members to take part in their group training sessions as a result.

Retention Tip #6 – Demonstrate Diversity

Just because you’re a gym, doesn’t mean you have to just sell memberships. The world of fitness is filled with options to mix up your income streams.  Offering extra services, such as nutritional planning and take-home meals are easy-to-implement additions to your gym. Alternatively, selling branded merchandise, like towels and tote bags, not only brings in immediate revenue, but acts as advertising. It sounds strange actually receiving money for your own advertisement, but it’s true.

Don’t offer group classes as standard with your memberships? Adding the option to book classes for a small fee can be an attractive prospect.

Step 4: Evaluate Your Efforts

When you’ve implemented all these different gym membership retention strategies, it’s time to have the talk. Your relationship might be going well, but let’s see how everybody feels. One way to do so is to assess your client relationship through surveys.

You can do this the old-fashioned way with paper forms or through digital customer satisfaction surveys on websites like SurveyMonkey and SurveyPlanet. Also, if you already have a specialized fitness software, you might be able to create surveys in your online club of gym members.

Creating a survey is one thing, but having your customers fill it in is another. That’s why you need an incentive: an account credit, a discount, a giveaway prize, a free promotional product, an extra free training session, etc.

However you do it, the feedback is vital, it is meant to adjust the way you manage your customers for the better. Remember that you shouldn’t wait for things to go wrong to ask how you can make them right!

You can also simply download our survey template for health clubs.

Lastly, ABA: always be analyzing. Check your metrics well and check them often. If you don’t like manual work and spreadsheets, it might be worth checking out some specialized member retention dashboards

Key Takeaways to Building a Winning Member Retention Strategy

Member retention isn’t as scary as it may first seem. We’ve taken a look at the basics of constructing gym membership retention strategies, and why it’s vital to take them seriously. And whilst there are various reasons behind people leaving, there is a far greater number of possible solutions.

These ideas are meant to inspire you to go the extra mile for your gym members. Remember, when it costs five times as much to attract a new customer than to keep an existing one, you might want to make sure that you’re taking care of your gym members! Fostering gym membership retention requires constant dedication, but is worth it in the long-run.

Steven Ecott

Content Marketer here at Virtuagym! I've been a journalist for the past four years, and love football, Yoga and tattoos.

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