Flexible memberships are increasing in demand and can be a good option for gym owners, provided it is well thought out
Modern society has demanded increasing flexibility from its members, for some time now – both on temporal and spatial levels. Fitness providers have this development to thank for their success, and the rise to the now most practiced sport, on the basis of active memberships.
At the same time, however, particularly independent gyms and fitness chains with small branch networks, are increasingly confronted with the problem that, alongside time flexibility, customers also require spatial flexibility to an increasing extent.
This in turn strengthens the position of the larger fitness chains, compared to the smaller providers, particularly in urban areas. Various providers want to help with this, by promising the gyms participation in their group, and a share of the generated turnover – which is why the gyms, in turn, allow members of the group to work out there (sometimes with a monthly restriction).
Using a presentation of the benefits and risks, the gym owners should be supported in their decision for or against participation in such a programme. At the same time, they should be presented with options, as to how to deal with the risks, in order to gain a financial benefit from such participation.
Benefits for Gyms
The most obvious benefit of participation in a flexible membership programme is surely the associated turnover, which can be generated practically without any costs to themselves.
Providers of flexible memberships, who demand money from the gyms, should be avoided. Ultimately, these providers benefit from you as a further gym in their portfolio and so, you should never be paying.
The second advantage is also quite obvious. Modern professional’s private life demands flexibility from many of your customers. This makes it especially difficult for individual gyms to keep these customers, as they cannot offer flexibility on a spatial level, which chain providers offer.
Here too, widespread flexible membership programmes can help, and prevent customers from leaving your gym. In doing so, the additional free marketing that you receive for your gym, should not be underestimated. Through this model, customers come to your gym without advertising costs, and enable you to convince them of your services.
Ideally the customer will ultimately decide on a permanent membership with you, and you have gained a new customer without advertising costs. Further, some membership programmes also offer advantages for the gyms that join you – discounts, similarly to those of the large associations of the fitness industry.
Of course, the risks should also be discussed at this point. Most frequently, gym owners worry that their own customers will migrate to the providers of the flexible membership models. However, this surely not unfounded fear can be resolved.
When looking for a partner who operates flexible membership, it is important to ensure that your own membership differs in either price or performance from the flexible membership. The flexible membership should never be cheaper, even if this is associated with lower performance. From previous experience we can say that price is a better distinguishing feature, as customers are frequently prepared to accept reduced performance for a lower price (in this case the flexibility).
If your own membership price is below that of the flexible model, migration is less likely. Furthermore, avoid advertising this membership model in your own gym, and if possible, choose a provider who does not have too many gyms in your region.
A further risk is that your affiliation with this network also means that negative actions of the network could also be attributed to you. So select your partner very carefully. It is better to have one discussion too many to get an impression of your future partner. Only in this way is a long lasting, constructive and trustworthy cooperation possible.
If you take note of the risks, and take the suggested solutions to heart, then this form of membership can generate additional turnover for your own gym, and customers that require flexibility due to their everyday life, can be kept. Yet here too, it is important to decide on a case-by-case basis.
There is no one general statement, as to whether this system is positive or negative. Look at your personal situation and your counterpart. Decide whether there is an advantage for your gym. Be prepared to put the brakes on it if necessary, and change your provider.
– Andreas Bechler
The writer is Managing Director of Tempomacher Consulting UG, a student management consultancy in the fitness, health and sport sector.