Maximising Member Retention: How to Design a Gym Loyalty Programme
Welcome to our blog for building a gym loyalty programme to maximise customer retention. We’ll look at:
Loyalty programmes in the context of the health and wellness industry.
Benefits a loyalty programme can bring to your gym.
The key elements of designing an effective gym loyalty programme.
Tips for promoting the programme using various communication channels.
Ways to overcome common challenges and pitfalls typically encountered during implementation of loyalty programmes.
Gym loyalty programmes are a great way for gyms to retain customers in an industry that experiences chronic levels of customer churn. Greater retention is essential for any successful business. For gyms, it brings:
A steady revenue stream
Cost savings
Brand advocacy
Enhanced engagement
Higher lifetime value
Community building opportunities
Insights from data
At the end of this blog, you’ll have a much better understanding of how to design an effective loyalty programme, best ways to promote it, accurately track and measure its impact, whilst overcoming the usual challenges and avoiding common pitfalls. All in the name of increasing the monthly membership count.
In an age of heightened consumer scrutiny, loyalty means so much more than retention. In fact, the same can be said for any other important metric. Whether it’s engaging your customers or spreading brand awareness through word-of-mouth marketing. Loyalty programmes are just as essential to your business as gym equipment.
Why?
Because ultimately they serve the same purpose – helping customers achieve their personal goals. A loyalty programme is a great way of showing your gym alone is an integral part of a customer’s transformation journey. Weights won’t give disillusioned members a pep talk. Treadmills don’t celebrate milestones. It’s true you and your staff probably do. But it’s probably tough to keep motivating customers outside of booked PT sessions, whilst maintaining equipment, admin work and running classes.
A gym loyalty programme offering relevant rewards and valuable incentives are also a good way to attract potential new customers and increase membership sales.
Builds deeper customer relationships
The truth is, establishing a loyalty rewards programme sets your gym on a course towards deeper, more meaningful customer relationships. Helping you go far beyond the expectations of every gym member and transcend transactional relationships.
Having quality equipment and experienced personal trainers certainly do make up the core reason why a customer would consider your business but a loyalty programme adds an extra incentive that your competitors might not.
One that not only attracts more customers but keeps them coming through your door time and again. That’s because they’ll feel seen, appreciated and most importantly, that you are genuinely invested in their transformational journey.
Improved retention
It should come as no surprise then that implementing a loyalty programme for your gym will give your retention rates and customer loyalty a significant boost.
According to Financesonline.com top reasons why gym goers continue to visit the gym is due to convenience of location (50%), positive interactions with staff (45%), and they like the equipment (38%).
Compare that to the retention prowess of loyalty programmes, 84% of customers continue to use brands that offer rewards for their businesses. Clearly there’s potential for loyalty programmes to become another good reason for customers to stay.
Enhances engagement
Loyalty programmes also enhance the level of customer engagement with your brand. Did you know that half of all gym goers quit 6 months after they initially signed up? Reasons why they leave vary. Mainly costs, lack of time and confidence, not seeing results, uncomfortable using equipment, and no accountability.
You’d be surprised to learn that a customer loyalty programme alleviates all these pain points. Due to the flexibility and highly integrable nature of loyalty programme platforms, you can consolidate features designed to enhance engagement and address the usual pain points experienced by gym goers.
For example, offering rewards and discounts on protein products, healthy food, gym wear and equipment, offsets the costs of essentials associated with going to the gym. If you can’t offer discount products due to lack of partner brands, you could offer free lessons as part of a welcome gift for newcomers.
The use of fitness apps has grown in recent years, a trend that is set to continue in the foreseeable future. Consolidating your loyalty programme into an app means your gym is always within pocket’s reach. Push notifications keep customers alert to tangible benefits and offers, which in turn keeps them engaged and motivated even when they’re not at the gym.
Pain point
Loyalty programme idea
Costs
Discounts on products from partnered brands or free lessons & free personal training sessions.
Lack of time or confidence
Virtual sessions to do at home
Not seeing results
Free consultation with a PT to measure and weigh
Uncomfortable using equipment
Book a free session with a member of staff to learn
No accountability
Feature to set personal milestones, in-app community encouragement, and refer others (gym buddy)
Offers a compelling point of difference at the onboarding stage
Loyalty programmes also offer your gym another selling point. Signing up to the loyalty programme should be just as simple as signing up to your gym. Quick tip: ease of access coupled with great welcome rewards should be the focus here.
That should be enough to persuade more prospects to sign up. After all, 57% of customers say loyalty programmes are the leading factor for positive purchase intentions. But let’s take it one step further. After all, this blog is about retention. How can we optimise the loyalty programme at the onboarding stage to increase retention well after the industry standard 6 month drop-off
Offering rewards that resonate at the beginning of a customer’s journey has a huge impact on newcomers. Satisfying and delighting new customers with unexpected rewards increases long term retention and has a lasting impression.
Fosters a sense of community
A loyalty programme also fosters a sense of community within your gym. This is important for long term retention as it counters various paint points that affect a large segment of gym goers.
This report found amongst reasons why people don’t go to the gym is due to:
Gyms are intimidating places (30%).
I wouldn’t know what to do at the gym (13%).
Gyms are unfriendly places (11%).
Collectively, these pain points affect 54% of non-gym goers. That’s more than all the other reasons why people don’t go to the gym. Of course, this is based on non-gym goers but as we’ve already seen, people who go to the gym also share similar sentiments.
Fostering a community encourages positive interactions between your customers. By sharing great experiences with your brand, customers create bonds with one another, negating feelings of intimidation and any inaccurate preconceived notions they may have about gyms.
Now, you might be thinking, all these features can be implemented in an app. So what’s the need for a loyalty programme? We’ll get to that later…
Remember when we mentioned how a loyalty programme enhances customer engagement by addressing their pain points? And questioned if it’s necessary for these features to operate within a loyalty programme? Well, the whole point of engaging customers is to make sure they stick it out at your gym and hit their goals.
If they’re struggling with one of the pain points listed above but follow through with a feature to alleviate it, why not reward that positive behaviour? This is where a case can really be made for placing all of these features into a loyalty programme framework.
To do so effectively, we should consider the design of key elements (rewards, tiers and incentives) to make the gym loyalty programme achieve your business needs and goals.
Rewards & tiers should be hyper-relevant to the customer journey
We’ve already explored how using a loyalty programme to offer welcome gifts optimises the onboarding stage. How it could differentiate your gym from competitors by providing truly unique experiences when signing up. Even more so when new programme members can draw from a wide selection of hyper-relevant rewards.
For example:
Protein shakes for people who want to increase muscle mass.
Running gear for cardio focussed customers.
Discounts on equipment relevant to classes.
Hyper-relevant rewards such as these resonate with customers and kick off the journey with a bang. In addition to this, tiers add another layer to their self-improvement journey, driving high levels of long term engagement and retention.
Incentives should alleviate pain points
It’s important to recognise the most prominent pain points experienced by gym goers. The ones we’ve mentioned above are a great starting point. However, surveys and feedback forms are a great method for understanding why people have missed a few weeks at your gym.
Once you’ve received feedback, think about how you can shape incentives around the pain point. A good example is one from the table above; encouraging referrals with customers who feel they have no accountability. It’s widely known in the fitness industry that customers like to workout with partners, friends and family. It motivates people to exercise with a gym buddy. Having a loyalty programme in place could facilitate referrals to help you address this pain point.
In fact, it’s much easier integrating referrals into an existing loyalty programme than starting from the ground up. Plus, new customers referred by existing members have a 16% higher lifetime value.
And if a referral programme isn’t right for your gym at this stage, try something else. It could be as simple as rewarding bonus points to a member who initially lacked confidence but booked a virtual training session at home. Or, putting someone not seeing results onto a tier because they hit their weekly goal of gym visits.
The loyalty programme should suit the specific needs and goals of your gym
Your customers’ needs and goals are important for successful retention but the loyalty programme should serve your business agenda too. An in-house or third party loyalty programme platform should address your most pressing priorities head on. Whether that’s:
Retaining customers to boost cost savings.
Drawing in new customers through word-of-mouth marketing.
Or stabilising margins with a steady income from loyal customers.
Projecting a percentage of revenue increase from tier upgrades etc.
Enrolling a set number of new members.
You should follow the basic principles of great loyalty programme design: setting goals using the SMART criteria, having clear and seamless UI and UX, an incentivising rewards structure, clear communications, round the clock accessibility and 24/7 support.
How to communicate and promote your loyalty programme
Both new and existing members of your gym need to be aware of the loyalty programme. Promoting your loyalty programme requires careful selection of channels that reach a wide audience. The message you communicate should be personalised, engaging, and clearly outline the benefits of the programme.
Here’s some tips to successfully promote your loyalty programme.
Craft compelling content
Focus on the benefits and unique aspects of your loyalty programme. Testimonials are the best way to demonstrate benefits.
Social proof convinces 75% of consumers to make purchases. You can leverage the persuasive power of testimonials and reviews to convince members to sign up to your loyalty programme.
Just make sure that it’s free to sign up as that’s another great benefit!
Develop a multi-channel marketing plan
Use a multi-channel marketing plan so that your promotional materials reach more members. Channels vary from social media to email marketing and even in-person interactions. The latter of which is perhaps more common for gyms during introductory tours of the equipment, classes etc.
Statistics show that 54% of marketers use cross promotion strategies. Featuring your loyalty programme across channels increases its visibility, customer engagement, conversion rates, and makes interacting with promotions a seamless experience.
Use social media and email marketing
Social media and email marketing are great channels to leverage when promoting a loyalty programme. Not only are they cost-effective – they work well for gyms and fitness clubs. Particularly if you choose to use social proof to make your content more compelling.
Short video testimonials are the most engaging social media posts. Increasing the chances of potentially new members taking notice of your loyalty programme. On the other hand, email marketing offers personalised messaging that can hook existing members of your gym. Personalised emails are opened 82% times more compared to generic ones.
Use influencer marketing
At this stage, it’s safe to say that influencer marketing and gyms are like shoulders and biceps or quads and calves. Like these muscle groups, when working together, gyms and influencers yield huge visible change. Collaborating with fitness influencers amplifies the visibility of your business. Partnerships focussed on promoting your loyalty programme lends it credibility to wider audiences too.
Run limited-time offers
Limited time offers are a great tactic to use when promoting your loyalty programme. As they create a sense of urgency, scarcity and a fear of missing out (FOMO). All of which tap into natural human curiosity and desire to obtain something considered rare and therefore precious.
In addition to this, limited time offers help you to retain existing customers. Particularly if the offers are available to existing loyalty programme members. Which they should be! A sense of exclusivity gives existing gym members subscribed to your loyalty a programme incentivises them to continue engaging with it.
Following the advice given so far will help you counter common challenges, such as:
Member distrust: the use of influencer marketing and social proof lends credibility to your loyalty programme and nurtures trust amongst your target audiences.
Lack of clear communication: following best design practices and communications that clearly highlight benefits, keeps the programme structures clear and prevents members from feeling frustrated and sceptical.
A lack of referrals: limited-time offers injects a sense of anticipation and excitement to your loyalty programme. Hype helps get it off the ground and gain traction and early momentum.
Limited awareness: using multi-channel marketing ensures your promotions reach a wider pool of your target audience of both new and existing gym members.
But let’s take a look at additional challenges, common pitfalls and strategies to avoid them.
Challenge
Solution
Member disengagement:
Maintaining a consistent level of member engagement with the loyalty programme is challenging.
To overcome this challenge, members need to be kept in the loop about benefits that resonate with them at different stages of the customer journey.
In addition to implementing engagement tools and personalising the programme to their health and fitness journey.
Consistent communication:
Develop a clear and concise communication plan, designed to stay in touch with members at every key touchpoint in their journeys.
Gamification:
Offer interactive sign ups and leaderboard to drive member engagement.
Celebrate member achievements:
Share positive news about members. Whether that’s attending a class or reaching a new tier level.
Abuse of programme:
Some members may attempt to game the loyalty programme in order to gain unearned benefits.
There are a number of ways you can protect your loyalty programme from opportunism and bad actors.
That way, you ensure every participant in the programme is on an equal playing level.
Clear programme rules and terms:
Establishing clear and specific rules and terms ensures members understand how the programme works and the consequences of not participating fairly.
Implementation of a loyalty programme typically requires gyms to invest in robust technology and infrastructure.
Features such as point-of-sales systems, customer databases and the development of apps can make integration complex and costly.
Invest gradually:
Consider gradual investment in tech and infrastructure if there’s budget constraints.
Choose scalable solutions:
Hire a third party loyalty programme software provider to develop, maintain and integrate the programme.
Data management:
Successful loyalty programmes rely on the collection, storage and analysis of data. It’s critical in fact in order to personalise rewards and offers.
Gym owners must also address privacy concerns and have the necessary tools to securely manage member data at all times.
Data privacy compliance:
Make sure your loyalty programme complies with data privacy regulations. In addition, data usage and means of protecting data must be clearly communicated to members.
Data security:
Invest in robust data security measures to protect member data from breaches.
Staff training:
Your staff will play a crucial role promoting and implementing a loyalty programme. They’ll need a thorough understanding of how the loyalty programme works. That way, they’ll be qualified to answer any queries from new and existing members.
Training programmes:
You can develop a comprehensive training session so that your staff are well-versed in rewards details.
Incentives:
Create incentives for staff to promote and support the programme actively e.g., welcome gift for new members.
Best practices for lasting success
The adoption of best practices also ensures your loyalty programme experiences lasting success. This is crucial for consistently retaining members at your gym and participants in your loyalty programme.
Regularly review and update
Regular assessment of the loyalty programme’s performance allows you to identify areas for improvement. Analyse key metrics, such as participation rates, ROI and member retention
Use insights gained from data analysis to inform decisions, adjustments and improvements. For continued success, a loyalty programme must stay fresh in the eyes of its participants. Therefore, introduction of new rewards, promotional materials and challenges, are more likely to be met with positive reviews.
Member feedback
Continue to seek out feedback even after the loyalty programme has launched. Incentivise members to participate in surveys, focus groups or even suggestions they think will improve the loyalty programme.
Member feedback is a great way to optimise loyalty programmes. It allows you to continue tailoring the programme so that it continues to delight members.
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