Client Retention vs Acquisition.. what's the balance?
Did you know that the average client retention rate of Fitness Studio's is 68% per year? Further to that, only 28% of Studio owner's actually track their retention rate! Most Fitness establishments get it backwards and focus too much on selling, getting new people in the front door, while forgetting those walking out the back door...
Let me start by saying, if you want a long lasting, successful and low stress career as a Studio or Gym owner, Client retention is what you should be spending the most amount of your marketing dollars & time on.. and if you do, you will save thousands of dollars each year, a ton of stress and loads of time!
Many will argue that new sales bring in new money to the business, and that's true, however when it comes to marketing , the average business spends up to 6 x as much on signing a new member, than keeping an existing one. Think about it.. how much time, energy and effort do you spend on campaigning for new sales?
Costs include graphic design, printing, distribution, social media ads, and brand awareness strategies to name a few. Now, how much does it cost to keep an existing member who already loves your service (no selling!), has already spent money with you (trust established!), and who is already advertising your brand by referring people to your business (saving you money on advertising!)? You're already hundreds of dollars ahead per member.. and there is NO STRESS!
If you can minimise the opportunity for your trainers to have to "sell" to a new prospect, would you do it? I know I would! Keep your trainers doing what they do best, training their clients and keeping them happy so they NEVER leave.
I guess what I'm saying is this is where a Customer Care System comes into play. The Customer Care System has many roles and benefits...
1. It shows professionalism and structure around your business
2. It creates a talking point amongst your clients and non clients alike, which could be seen as a good marketing tool.
3. It shows the customers (and non-customers alike) that you genuinely care about your members, increasing your 'likeability' rating
4. It increases your Brand recognition and increases customer retention
5. It acts as a sales tool as a genuine 'value add' to your business to external prospects.
Now, the question is.. when does the customer experience begin? My view on it is the first time the prospect hears about you or meets you. You want that first impression to be a good one. Whether it be from a flyer, an existing client talking about you, the first time you talk to the prospect over the phone, or at a BBQ - it doesn't matter HOW it happens, but it must be GREAT. From here, their journey with you begins.
There are many components to this process and I have outlined them as follows:
A typical Customer Care System looks like this:
- The initial interaction (face to face, over the phone, email etc) Create the impression and collect the prospects details
- The follow up process ( see an example here )
- The Sale – immediately give them something tangible eg: Welcome Pack
- The first 12 weeks post sale – Process of follow up calls, emails, referral requests, and 'above expectations' service (all can be seen in our Fitbizhub products)
- Customer Satisfaction Surveys
- The Lifetime Loyalty Rewards Program – Points received for regular attendance, referrals etc.. do not reward them on how much money they spend with you (no one wants to be reminded of what they spend!)
- Handwritten notes/letters – Birthdays, Anniversary, 100 Sessions etc
- “Just Because” gifts – random movie tickets, night out, massage etc
- Social Events – Client Gatherings, Movie Nights, Family BBQ’s etc
- Unique gifts for loyalty (5 year, 10 year members) something they or anyone else cannot buy.. make it memorable!
Every person you have ever encountered has been a potential fan of your business..
So in summary, if your start-up days are behind you and your business is established, chances are that growing your business will be cheaper and faster if you retain and sell to your existing client base. This is not to suggest that you need to abandon acquisition efforts completely, but you need to shift the focus to your existing clients. If you are a start-up, then naturally your initial objectives should be to focus on new business acquisition and then as the customer base increases, start shifting the focus to retention.
For more resources to help in your Fitness Business, head on over to our Fitbizhub . You will find everything you need right there!
Yours in Fitness Business Success,
Ben Dulhunty
