Access FIT

iPOS Update

Our FREE preview chapter for The Lead Box is DEAD… Long Live iPOS: The Humble Lead Box Concept Reinvented for the Twenty-first Century is going through its final edit and will be available for release on the 7th May with the limited release of the full report approximately two weeks later.

The preview chapter is intended to frame the issues surrounding the decline in the effectiveness of Lead Boxes and indicates, in preliminary way, how the iPOS advertising system provides a better solution for new member acquisition and retention.

Stop marketing to the world

“In marketing I’ve only seen one strategy that can’t miss: market to your best customers first, your best prospects second, and the rest of the world last.” – John Romero

The value of exercise is in its continuation

As exercise guys, and girls, we tend to place a premium on exercise. And, often, we as owners and managers believe our own hype when it comes to the value of what it is we are selling.

Is a guest pass really worth $15… I know some clubs that charge $25, even $40 for a single guest/day pass.

Of course, some of these are priced to be prohibitively expensive to move prospective members towards a membership but the problem is that these owners and mangers start to behave like the guest pass/day pass is actually worth 15, 25, or 40 dollars.

In free markets the true value of anything is whatever the market will pay.

When I was an instructor my boss approached me on shift and told me he wanted me to take a bunch of free passes and hand them out in the shopping center on the floor below (another one of those ad hoc marketing tactics).

I couldn’t give them away.

Of course, his thinking was who wouldn’t want a fifteen dollar free pass… but the value in that marketplace was virtually zero, even when the cost was zero.

Here’s the problem with the free pass give aways… everyone who values exercise (or at least exercise in a club) probably already has a club membership. That’s not to say they won’t take a pass and give your club a try but they won’t leave their club until their membership come due. And if they’ve already got a club on your area they probably already considered your club… and rejected it.

For almost everyone else, the people who don’t value exercise, aren’t going to be convinced on the basis of a single visit. In fact, a single visit to your club is more likely to confirm why they don’t value exercise… they don’t know what they are doing… they feel stupid… everyone else is so much better than them… they feel like everyone is looking at them…

You’ve essentially convinced them not to continue exercising… its negative reinforcement in action. If they feel bad by coming into the club the solution to feeling better is to not come into the club… problem solved.

The point is to get them to want to continue exercising. They only get the benefits of exercise if they continue exercising… and you only get the ongoing revenue stream if they continue exercising.

Therefore, for these beginners, you need to be able to demonstrate to them how they can continue in your club (by overcoming their fears) and not simply showcasing your stuff.

A guest pass can’t do it… a week can’t do it… even two or three weeks (without more) is a stretch.

Why your marketing plan isn’t worth the paper it’s written on

Not that long ago no one had a marketing plan… there wasn’t any real need. The industry was set up for bodybuilders, strength enthusiasts, athletes, and wannabes.

They knew who they were and they knew what they wanted… open a gym and they would beat a path to your door.

Ahhhhhh, those were the days.

Eventually, bodybuilders, strength enthusiasts, athletes, and wannabes (who made up almost the entire market) were joined by “regular” people (women, youth, families) as the industry continued to push for expansion and gyms became known as “fitness centers” and eventually “health clubs”.

Of course, this new diversity of interests required a more considered marketing approach… hard body images that dominated the industry were now offensive to “real” people.

And as competition increased and marketing ROI began to diminish the call went out to develop a marketing plan.

It made perfect sense… organize all marketing activities into a consolidated 12 month plan. Allocate a budget and… cha ching!

Consultants positioned themselves as marketing “experts” because they had a marketing plan and they spent a lot of time trying to convince owners and managers that they needed it.

I do agree that a marketing plan is a good idea, mostly because it focuses attention, encourages review, and informs decision making. However, most marketing plans are simply a schedule of ad hoc tactics conveniently placed into a list… and a list of ad hoc tactics isn’t a plan.

Sure it gives a kind of false confidence but those few owners and managers who have a marketing plan rarely do significantly better than those who don’t on a dollar for dollar basis.

Why?

Well… it’s because ad hoc tactics are ad hoc tactics whether they are scheduled or not.

If you ask many of these marketing “experts” why they do newspaper advertising in May and postcards in September the usual response is something like… “We like to keep it fresh, mix it up a little, and see what happens”.

With respect this isn’t a satisfactory response. If your consultant or advisor is telling you to try everything (even if it is in a marketing plan) my advice is find someone else.

Your consultant or advisor (whether they are internal or external) needs to bring a strategy, not just tactics, to the table and while a marketing plan appears to be strategic often it is just a bunch of tactics made to look more substantial than they really are.

Customer service… the numbers don’t add up

I heard a statistic recently, I’m not sure if it’s true, but it sounds about right to me; it was this… a health club can only service approximately 5 to 15 percent of its members in any given week.

So a club with a thousand members will only reach between 50 and 150 members each week with its customer service efforts.

That’s a pretty sobering statistic… and it’s likely to get worse as clubs trim their payroll to compete with the low-pricers.

It also emphasises the importance of what a limited resource customer service really is… and of course when resources are limited they must me used strategically to yield maximum ROI.

Customer service alone won’t, and in fact can’t, get the job done.

Customer service has to part of your much larger, more comprehensive, customer experience management strategy.

Stop thinking customer service… and start thinking customer experience management.

Customer service and the Semmelweis effect

The Semmelweis effect is the tendency (a cognitive bias) to reject new evidence that contradicts an established paradigm.

It is named after Ignaz Semmelweis who, in 1847, discovered that child mortality rates could be significantly reduced if doctors simply disinfected their hands (rather than just wash with soap and water as was the practice at the time).

Semmelweis’s peers roundly, and quite viciously, criticised his findings as unscientific (this was before germ theory was accepted in the late 1800’s) and Semmelweis ultimately suffered a serious mental breakdown and was committed to an insane asylum where he died in 1865.

What does all this have to do with customer service? Watch the video below and see if you can spot the Semmelweis effect in action…

Now I don’t know Kevin Hedley personally but from his presentation he seems like a successful, intelligent, and articulate guy and I apologize if he went on to discuss this in greater detail than is shown in the video…

Kevin reveals his significant findings: (1) 40% of health club members don’t consider personalized interactions an important part of their health club experience, and (2) 64% of health club members considered that their membership consultant took a real interest in making them feel comfortable in their first few weeks as a new member.

He then goes on to draw this conclusion… the results show the importance of continued customer service by the membership team and consistent, positive members interaction from all staff.

It seems that (like most consultants) whatever the data showed he was going to come to the same conclusion… we need to improve our customer service (i.e. rejecting evidence that contradicts an established paradigm).

The real significance of this data, to me, is if 40% of health club members don’t consider personalized interactions an important part of their health club experience we need to be able to identify them so we can commit our, very limited, resources to the 60% of our members that do consider it important.

This is the basis of my previous post on customer service triage.

In my assessment these 40% are most likely to be more advanced health club members who are basically in control of, and have taken responsibility for, their own health club experience and therefore don’t require input from health club staff. Of course, more advanced members are interacting with their peers in the health club and because they basically know what they are doing are not reliant on health club staff.

However, in my experience, more advanced health club members naturally attract more than their fair share of attention from health club staff because of their regular attendance, quasi-celebrity status, and generally higher levels of comfort in the club. Basically they are easier to interact with and so they get interacted with more… a critical, yet common, misallocation of resources that can contribute to new member attrition.

The point is this... if we are going to take the time, and invest the resources, to enquire into our member’s health club experience we owe it to them, and ourselves, to use those findings more intelligently than to form a conclusion that simply supports the status quo… and not the available evidence.

Strategy vs. tactics

I am often critical of our industry (owners, managers and even many consultants) for its lack of strategic thinking and its addiction to ad hoc tactics.

It occurred to me that many people don’t actually understand the difference between strategy and tactics (of course it doesn’t help that the two terms are used synonymously)… and in fact many people think they are being strategic when they are actually being tactical.

Here’s what marketing guru Seth Godin has to say about the difference between strategy and tactics.

Basically, the difference is this… strategy is employed to, efficiently and effectively, achieve a particular outcome (mission/objective) and tactics are employed to, efficiently and effectively, achieve a particular strategy.

For example, if the mission/objective is to get more members there is any number of ways to achieve this very broad objective. And because no business has unlimited resources it must be achieved within certain constraints (budgetary, human resources, legal, time, cultural).

Strategy must address those constraints and still deliver on the mission/objective by answering the critical who, what, where, when, why, and how questions.

• Who do we want to target?
• What do we need to do to appeal to our target market, what problems do they have?
• Where are they… and can we reach them?
• When is the best time to get their attention and convince them to take action?
• Why should they care about you? Why are you better than your competitors?


• How can you solve their problems?

Strategy has directionality. By answering these questions it forces you to think about where your resources are best deployed for maximum ROI. It moves your business in a specific direction.

Only once you have your strategy nailed down should you start to consider which tactics will best fit your strategy.

This is where most owners and managers (and many consultants) go wrong… they skip the strategy step completely.

For example, we need to get more members (mission/objective) lets put an ad in the paper (tactic)… and when that doesn’t work, lets send out a flyer (tactic)… and when that doesn’t work, lets try a radio ad (tactic)… and when that doesn’t work, lets get on Facebook (tactic)… and when that doesn’t work…

Most consultants actually encourage this by promoting the latest and greatest tactic… pitching it like it will solve all the owner’s or manager’s problems. There are very few strategic thinkers in our industry… Thom Plummer and maybe one or two others.

The end result is a marketing mess, wasted money, endless frustration, and a perpetual search for the next “BIG THING”.

Strategy is not easy, it doesn’t come naturally to most (especially when most so-called industry experts are pitching tactics), and it is almost impossible to do on the frontlines (where you probably spend most of your time). There’s a reason the armed forces don’t deploy Generals to the frontlines… it’s hard to think strategically when the bullets are flying.

To complicate matters further, people like to think of themselves as strategic (I guess it sounds cool) when they’re actually not… a friend of mine (who works in compliance and risk management) told me quite earnestly that she was strategic because she redesigned a form to make it easier to use.

Throwing tactics at a problem and hoping one works isn’t strategic… in fact hope is rarely the best strategy.

Focus on the negative

Having done quite a bit of research on industry advertising and marketing in the process of developing our latest Business Development Report, The Lead Box is Dead… Long Live iPOS: The Humble Lead Box Concept Reinvented for the Twenty First Century, we noticed quite a bit of advice focused on rewarding behaviours through positive reinforcement (free t-shirts, free guest passes, free personal training, free water bottles, free towel, free… just about anything).

Most people without a background in psychology understand the concept of positive reinforcement pretty well. Positive reinforcement is the presentation of an appetitive (gratifying) stimulus to increase the probability of a desired behaviour. Importantly, the stimulus is presented after the desired behaviour. For example, when the new member walks into the club the front desk staff greets them warmly… reinforcing the desired behaviour i.e. coming into the club.

Pretty straight forward right?

However, when most people think of negative reinforcement they are actually thinking of punishment i.e. the presentation of an adversive stimulus, or the removal of an appetitive stimulus, that decreases the intensity or probability of a particular behaviour.

Punishment is intended to reduce the intensity or probability of a particular behaviour. For example, as part of their “No Judgement Zone” philosophy Planet Fitness both ridicules bodybuilder types/behaviours in their clubs (presentation of adversive stimulus), and limits the weight of their dumbbells (removal of an appetitive stimulus) to actively discourage more advanced health club members who are, typically, heavy users. Of course, given their business model it makes sense for Planet Fitness to actively discourage heavy users in their clubs.

Negative reinforcement, on the other hand, is the removal of a noxious or aversive stimulus to increase the probability of a desired behaviour. For example, Curves don’t have mirrors (or men) in their clubs because their members don’t like them… by removing the adversive stimulus their members are more likely to use the club.

Thom Plummer wrote an insightful Blog post recently that recommended new members be allowed to have a guest work out with them, free of charge, for the first 30 days of their membership.

While this, ostensibly, appears to be a typical positive reinforcement scenario (i.e. offering something of value to increase member’s likelihood of using the club) it is actually a negative reinforcement scenario.

By allowing beginner/new members to have a friend in the club with them it reduces/removes their anxiety, stress, apprehension, and fears of looking stupid, out of place, and being the only out of shape person (negative stimulus) and increases their likelihood of continuing to use the club (desired behaviour).

Remember that, above all else, beginners are focused on their own survival… and there is definitely safety in numbers.

By focusing on the negative you can influence your beginner’s behaviour much more than any amount of, well meaning, freebies.