RETENTION SERIES Sticking with it: Over-35s have
a 50 per cent lower cancellation rate compared to under-35s
Resolution 1: Develop a marketing strategy that attracts more members aged 35 years and older Members aged 35+ have a cancellation rate that’s 50 per cent lower than members aged under 35 years. Over the first eight months of membership, based on 1,000 members aged 35+ versus 1,000 members younger than 35 years, this translates into a difference in income of £27,035 (see Figure 2). If all members were aged at least
35 years, 30 per cent of membership cancellations would be avoided, lowering demand on sales by the same proportion. This does not, of course, mean turning new members away – rather it’s about making sure your message, imagery, offer and member experience is more attractive to this older demographic.
Resolution 2: Help members set realistic goals focused on enjoyment and friendship, and help them to achieve these goals In previous articles, we’ve reported that members who are motivated by appearance, and who perceive they are not making progress, have a high cancellation rate, whereas members who have social motivations and report making a friend have low cancellation rates. Figure 3 estimates the eight-month
income for these two scenarios. Over eight months, the socially motivated members yield an additional £32,335 compared to 1,000 members who fail to achieve a goal of improved appearance. Further, if all members who were
motivated by appearance, but who failed to make progress, had been
‘replaced’ by socially motivated members who made a friend, 28 per cent of all membership cancellations would have been avoided.
Resolution 3: Encourage and assist members to include some group- based exercise into their routine Members who include at least some group-based exercise in their routine are 30 per cent less likely to have cancelled over the eight-month follow- up period compared to members who never do any group-based exercise. If all members included some group-based exercise into their routines, there would be 18 per cent fewer cancellations.
FIGURE 2 Estimated income over eight months, based on TRP 10,000 retention data, from an initial sample of 1,000 members – by age group
£60,000 £50,000 £50,000 £47,455 £45,410 £40,000 £43,860 £42,355 £40,940 £39,290 £30,000 <35 >=35 £20,000
1 2 3 4 5 6 7 8 Months since joining
£38,955 £44,390
£48,900
Total income = £375,300 Total income = £348,265
£48,085 £47,420 £46,375 £45,625 £44,505
FIGURE 3 Estimated income over eight months from appearance- driven members who made no progress vs socially-focused members who made a friend – from an initial sample of 1,000 members
£55,000 £50,000 £45,000 £40,000 £35,000 £30,000 £25,000 £20,000
£50,000 £47,085 £48,970 £47,530 £43,335 £40,390 £38,220 £36,380 £36,380 £45,835 £46,710 £45,470
Total income = £369,960 Total income = £337,625
£44,000 £43,640 £43,640
Social motives Appearance motives
1 2 3 4 5 6 7 8 Months since joining
52 Read Health Club Management online at
healthclubmanagement.co.uk/digital
January 2015 ©
Cybertrek 2015
PHOTO:
WWW.SHUTTERSTOCK.COM/KURHAN
Income per month
Income per month
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