TALKBACK everyone’s talking about . . .
premium pricing I
t’s been all about low-cost recently, so it’s refreshing to hear about something new: a breed of entrepreneurial
operators coming up with innovative concepts which people like – and are willing to pay for. On his UK roadshow in March of this
year, Les Mills CEO Phillip Mills talked about the emergence of the ‘micro- gym’. These clubs typically specialise in one or two types of training – particularly group exercise – or high- end equipment. They also offer the sort of personalised attention which can sometimes be missing from larger facilities – and they charge a premium.
People want value at the moment,
but value doesn’t necessarily mean cheap. Some people want to be able to chat at length to enthusiastic staff about their cycling, running, boxing or yoga technique. If you regard health and fi tness as
your hobby, rather than something you have to do to maintain your body, do the parameters about how much you’re willing to pay change? Do these premium clubs attract only the wealthy, or will those who value the service they offer fi nd the money by going without something else? US operation SoulCycle was praised by Mills. The concept, according to
ARE PREMIUM CLUBS THE WAY FORWARD? EMAIL US:
HEALTHCLUB@LEISUREMEDIA.COM
phillip mills les mills international • ceo
new ways to win and retain members. The emergence of budget gyms and micro-gyms – innovation at both ends of the scale – are a consequence of members’ constant search for value. When your members leave for a budget club, they’re effectively saying
“R
‘We don’t value the service you provide enough to pay £50 a month, when someone else charges me only £15.’ Yet at the same time, these micro-gyms are charging £150 a month, or £30 a class, and they’re filling up. I’m impressed with SoulCycle in New York City – they fill cycling classes at US$32 a time – and Pure Yoga in Hong Kong and New York. Both earn premium fees for powerful classes within a simple business model. Micro-gyms work because they give members customised
attention and exercise that suits them. Even in tight financial times, people are prepared to pay for what they truly value. That’s the nugget for the wider industry. Capitalise on this trend by really understanding your attendance and your member profile, what they want, their fitness needs and what your club is good at.
” 28
ecession or not, our industry is under constant pressure to find
hilary gilbert boom! cycle • managing director
“T
o charge a premium, operators must be excellent at whatever
service they are offering, maintaining that excellence through the instruction, through equipment that’s specific to the service, and through the atmosphere. The customer must always feel that what they are spending is justified. At BOOM! Cycle we have always
aimed, to put it bluntly, to make it easy to spend money and make it pleasurable for our customers to pay for a service they feel is worth the fee. We had our bespoke system built to make it easy to make bookings and we take all credit cards. Finally, we always aim to provide excellent and personal customer service – remembering people’s names when possible, their taste in instruction, and taking their suggestions on board. I think pay-as-you-go customers are more willing to pay
a higher price because they are not locked in to anything – people accept that it’s common practice to pay a premium to maintain flexibility. We don’t do memberships, so every BOOM! Cycle customer is pay-as-you-go. I think this is a good form of quality control for us – as our customers aren’t locked in, we have to ensure optimum quality at all times.
” Read Health Club Management online at
healthclubmanagement.co.uk/digital may 2012 © cybertrek 2012
kath hudson • journalist • health club management
In a market where everyone seems to be sliding towards low-cost, a few operators are bucking the trend and charging premium prices. And people are paying. So how do you get the ‘It’ factor?
director of PR and marketing Gabby Etrog Cohen, is “an engaging workout which benefi ts both the mind and the body by combining inspirational coaching with high-energy music”. Each visit is a fi nely-tuned individual
experience, from the interaction at the front desk – where staff know the member’s name and water preference – to the instructor setting up the bike and giving personal instruction. “SoulCycle was built on personalised service, and that brand pillar has not changed and will not change as the brand expands,” says Etrog Cohen. So are we heading towards a boom in premium concepts? We ask the experts.
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