To a large degree, our industry has been dominated by the commercial model: Be it Pilates, Orange Theory, F45, CrossFit, OTF or Zumba, Curves, 24-Hour Fitness, Planet Fitness, you get the point.
None of these models has focused on client retention or developing coaches. More often than not, becoming a coach involves a weekend course and possibly a few hours of in-house training.
THE BOTTOM LINE: They’re not built from the ground up to create long-term client, coach or business success. Instead, they’re investor-driven models that take a top-down approach.
This is nothing new. In the past 20 years, we witnessed the fast scale model take over everything from Curves to CrossFit, and then watched as the marketing companies came in to tear away at the CrossFit carcass with one get rich scheme after another. Remember the free 6-week challenge, the New You and the Couch to CrossFit marketing shenanigans? They existed solely to bring bodies into an already failed gym model. If the fast scale model worked for the long haul, none of these companies would have ever existed.
How the Model Works for the Client and the Coach:
In order to generate revenue fast, here’s what happens at these gyms for the clients and the coaches is this:
- The idea is to bring a ton of clients in quickly to generate revenue, so new clients go right into a big group class with little care about their actual needs to get fit and stay fit. Real coaching is non-existent.
- Coaches get paid per hour or per class, and in some cases, they receive a percentage of revenue for upsells (aka PT packages, supplements, other swag).
- Coaches receive a few days, or a few weeks, of in-house training or attend a hodgepodge of weekend courses or seminars.
There’s a reason it’s done this way: The system is simple to understand, simple to learn and simple to execute.
Secondly, it allows gyms to handle a lot of people in a short time (some franchises pre-sell as many as 500 memberships before they even open their doors to people they know nothing about). In this sense, it succeeds in making money fast.
Here’s what happens to clients and coaches in these short-term minded models:
- Annual churn rates are 70 percent and higher - the great majority of clients last nine months or less.
- Coach churn rate is approximately 2x client churn, meaning most coaches last between nine and 18 months.
- They pay huge upfront costs to make little profit and are vulnerable to a crash after five to seven years.
So after just a few years, here’s what you end up with:
Clients move on. Coaches move on. Investors are out, and the fitness industry plunges another rung deeper in society’s respect ladder.
What about CrossFit affiliates and other functional fitness-style gyms, which aren’t franchises.
Interestingly enough, CrossFit gyms—which offer a much more effective way of getting fit— experience similar numbers to the franchise model. Yes, client churn rates are a fraction better—60 percent and higher—and coaches last a bit longer than in the franchise model on average, though very few coaches stick around for 10-plus years pursuing a professional career.
It all starts with the client development process, which is how you bring new clients in and keep them there.
We have learned, and what this Ebook is all about, is why you should adopt a personal training first approach (PT-first) model.
The PT-first model attracts high-value clients (who pay $220 to 300-plus per month) who remain at your gym for years. In this model, combined with the proper coach compensation and training, your client retention will go from less than 30 percent to 80-plus percent.
The Result of PT First
Clients are more successful, coaches can finally earn a good living pursuing a career they find fulfilling, and the gym can earn a profit, not just for five years, but for the long-term.