Discover how implementing a well-designed and incentivised gym referral programme can help you attract new members, increase retention rates, and build a strong fitness community. Get ready to amplify your gym's success by harnessing the power of your existing members and turning them into brand advocates.
What is a Gym Referral Programme?
Gym referral programmes are designed to incentivise and reward existing members to refer friends, family, or acquaintances to join the gym. These programmes are key to successful new membership acquisition and retention.
According to INVESP, customers referred by other customers have a 37% higher retention rate and are 4 times more likely to refer more customers to your brand.
Referral rewards may include discounted membership fees, free months of membership, exclusive access to additional services or gift cards. Gym referral programmes can create a sense of community among members and can be a cost-effective strategy for membership acquisition.
That said, gym referrals are often word-of-mouth recommendations with new referred members and rewards tracked manually with paper-based systems or spreadsheets. However, implementing referral programme software can greatly enhance efficiency by reducing the need for manual intervention and providing greater scope to scale your referral programme and membership growth.
Once set up and verified on a referral platform, the referrer is allocated a unique code and is free to share the code with potential new gym members. From there, the whole process is automated from referral tracking and reward redemption & fulfilment for both referrer and new member.
What are the Benefits of a Gym Referral Programme?
Gyms that implement a referral programme using best practice enjoy several benefits. Let’s take a look at these in closer detail.
Increased Membership Acquisition
A referral programme harnesses the power of word-of-mouth marketing, allowing existing members to promote the gym to their friends, family, and acquaintances. This can lead to a significant increase in membership acquisition as referrals tend to have a higher conversion rate compared to other marketing channels.
Higher Member Retention
Using this approach gyms can attract new members but also foster a sense of community and belonging. Members who are referred by someone they know are more likely to feel connected to the gym and have a higher chance of staying engaged and renewing their memberships, thus boosting member retention rates.
Referrals often result in leads that are a good fit for the gym's target audience. Members tend to refer individuals who share similar fitness interests, goals, or lifestyles, resulting in a higher quality of leads and a greater likelihood of member satisfaction.
Done right, operating a referral programme is a cost-effective marketing strategy. Instead of spending significant resources on traditional advertising or marketing campaigns, gyms can leverage the existing member base to generate referrals. This reduces customer acquisition costs and maximises the return on investment.
Satisfied members who have had a positive experience are more likely to share their enthusiasm with others. This organic promotion can have a far-reaching impact, attracting potential members who may not have been reached through traditional marketing efforts.
Enhanced Member Engagement
Referral programmes encourage member engagement by incentivising them to actively promote the gym. Members become more involved in the gym's community, creating a positive and supportive environment that fosters loyalty and long-term engagement.
Rewards and Incentives:
Referral programmes provide a win-win situation for both the referrers and the referred individuals. Referrers receive rewards or incentives for successful referrals, while the referred individuals often benefit from exclusive offers or discounts. These incentives motivate members to actively participate in the referral programme.
Improved Trust and Credibility
Since referrals come from trusted sources - friends, family, or acquaintances who have personal experience with the gym. This increases the trust and credibility associated with the gym, making potential new members more likely to join with confidence.
Membership Acquisition Challenges
Why Consider a Gym Referral Programme?
The fitness industry is notoriously competitive. Larger health club chains still hold the majority of market share but smaller chains and independent gyms have 42% of all existing gym members. Whilst that’s pretty good going, most of the competition is coming from online digital fitness platforms.
In the same article by Zippia, digital fitness platforms are apparently the fastest growing sub-sector in the health and fitness industry...
Growing at a rate of 33.10% per year compared to just 7.21% of traditional gyms. Who in order to stand out, need to focus on honing their unique selling point (USP), differentiating themselves by highlighting special benefits to members.
To overcome this challenge, you should consider what to market and how. Think how to showcase the credibility of experienced personal trainers, promote exclusive classes, and encourage existing members to take part in a supportive community.
Customer Cost Concerns
During the cost-of-living crisis some individuals may hesitate to sign up to a gym membership due to financial constraints.
A survey by London Sport showed that the CoL crisis has made it more difficult for 39% of people financially committing to the gym for longer periods of time. With 11% claiming it has had a significant impact on their ability to go to the gym altogether.
You can address this by offering flexible membership options such as monthly or short-term plans instead of annual contracts. There’s also an opportunity to include tier levels to your services. Offer varying prices and benefits at different membership tiers. This adds even more flexibility as potential members choose options that suit their needs and budget.
Additionally, by providing new and existing members with access to a loyalty programme that is seamlessly integrated with a referral programme, you can offer your members exclusive rewards and additional gym benefits as well access to a wide range of hyper relevant rewards and discounts from your selected partners.
These rewards, including discounts on protein shakes and other health foods for example, can help offset the cost of gym membership by providing savings on products they would typically purchase anyway. If you haven't yet established a partner network, a good loyalty programme should include a comprehensive network of rewards that can be configured to your membership base.
Lack of Awareness
Many people may simply not be aware of the existence or benefits of your gym. Therefore, it’s important to cultivate an online brand presence by investing in marketing and advertising strategies. Increasing brand awareness doesn’t always have to be expensive.
Depending on your budget, you could start improving your brand’s exposure on your social media channels. For example, filming “how to” videos starring your PTs (demonstrating their expertise) showing viewers how to use equipment, workout tips for people with health conditions, and even meal plans.
Videos on social media are seriously effective with 93% of brands who use them acquiring new customers.
It is crucial to invest in marketing and advertising strategies to increase awareness. Utilise various channels such as social media, local advertisements, website optimisation, and partnerships with local businesses or influencers. Offer free trials or special introductory rates to encourage potential members to try out your gym.
8 Best practices that keep your referral programme in top form
Below are 8 best practices you should follow to improve the chances of designing a successful retention programme. Bear in mind that you should have the basics in place that keep customers happy.
Customer service and experience, the condition of your gym equipment, and training of staff should be up to a standard that makes members want to advocate you in the first place.
1) Clear Incentives & Rewards
Your incentives should be clear. Avoid confusing members with complex conditions and long descriptions of what they stand to gain. Benefits should be explained in a straightforward, short and sweet manner. For example: “Refer a friend and get 50% off your memberships next month.”
We’ve given them an instruction, simply described what they get, and given them a time limit to drive uptake.
Rewards need to keep members engaged, motivated and encouraged to stick with the referral programme. Any delays receiving rewards will have negative consequences. That’s why it’s important to track the programme so that brand advocates are rewarded in a timely fashion. Just remember redemptions of rewards should also be simple and easy.
2) Simplicity and Ease
The process of referring others should be convenient, frictionless, and user-friendly. You limit the referral pool if members can only refer others using your website. Therefore, invest in the development of an app that works in tandem with your other channels.
By doing this, you take full advantage of the referral programme. The whole point is for your gym to be brought up in conversation. When it does, you want the process to be as simple as someone pulling out their phones and pushing a few buttons.
The digital platform should also let brand advocates track referrals and their progress towards full membership. That way, it builds anticipation as they near their reward.
3) Promote Programme
You should already have various channels in place to differentiate from competitors and reach more audiences. Use this to your advantage. Promote your referral programme on social media, SMS notifications, print media, newsletters and in your gym(s).
It’s essential that you get the messaging right by leading advertisements with the benefits of the programme. Therefore, keep a consistent promotion – the spine so to speak – of your referral programme. For example, you could use the reward we described above (“Refer a friend and get 50% off your memberships next month”). Let’s edit this slightly so you can use it as the main incentive.
“Refer a friend and get 50% off your memberships for one month.”
The incentive isn’t time sensitive anymore. However, you can use it as the main one, from which you can eventually branch out with other referral programme ideas.
4) Referral Tracking Mechanism
Referral programme tools automate and simplify the process, offering advantages over manual management. They provide a centralised platform for tracking referrals, managing rewards, and communicating with participants. These tools eliminate the need for manual spreadsheets, reducing errors and streamlining workflows.
Built-in analytics provide valuable insights, allowing you to monitor metrics and optimise your programme. Referral program tools simplify management, enhance accuracy, and offer valuable insights, making them a superior choice to manual methods.
5) Recognise and Celebrate Success
Recognising and celebrating the achievements of members who make successful referrals is a powerful way to motivate others to participate in your referral program. By featuring them on a "Referral Hall of Fame" board or highlighting their success stories in member newsletters or on social media, you not only give them the recognition they deserve, but you also inspire others to follow in their footsteps.
6) Regular Communication
Regular communication is another great way to keep members engaged with the programme. Whether that’s email, SMS, on the digital platform itself or even on a members forum.
It’s also an excuse for you to tease any new rewards that you're planning. An exclusive reward for the most successful brand advocates would be effective. Particularly if they’ve exhausted their referral limits. Add variety to the benefits though. This could be a selection of rewards: a free class, invitation to a seminar with a well-known fitness instructor, discounts on products from partnered brands e.g., protein powder etc., maybe even a secret reward countdown for one year anniversary memberships.
7) Continuous Evaluation
The example we used above could be exploited by opportunists looking to perpetually get their gym membership half price. Therefore, you need to put terms and conditions in place. Perhaps limit referrals to 5 per year and to members who’ve been at the gym for at least 3 months.
Nobody likes restrictions. Some people may be deterred by this. However, timely rewards offered at the right point in the customer journey, builds anticipation and maintain interest. That’s why it’s important to continually evaluate the programme and adjust it based on data-driven insights.
For example, if you see a drop off at a certain point – say – after one year; it might be time to implement highly personalised rewards. Like the idea above; one month free membership after you’ve been with the gym for a year.
8) Staff Training
Your staff are well trained to look after your customers. To assist them on gym equipment, even to give them first aid should an emergency arise. They also need to be trained to know the ins and outs of your exercise referral scheme. Every staff member should have an answer for any question thrown at them about the programme.
Indeed, your staff should also be trained to promote the referral programme in a non-pushy way. As mentioned in the acquisition strategies above; tailor the first walkaround and taster days to the needs, interests and goals of the prospect. The referral programme should be sold in the same way.
Acquisition Strategies for Gyms
Referral programmes should be a key element in your overall holistic membership acquisition strategy.
Free trials, promotions and community engagement
- Free trials are a great way of showing off your facilities, equipment, classes and team. Most gyms invite potential members to a walkaround. Be the difference. Train staff to listen to the goals of the prospect and offer them one class or session based around these goals for free.
It’s not like they’re not going to hit their goals in one visit and never return. By giving them a taster of what you’ve got to offer, you instantly set yourself apart from competitors. You’ll be giving them an experience instead of just information. Don’t forget to let them know that you also offer flexible plans suited around them.
- Promotions should push a sense of urgency. On the initial walkaround make sure classes are advertised with boards clearly showing sign-up deadlines and limited spaces. Limited-time promotions and certain seasonal offers may resonate so much with the prospect that they just have to sign up.
- Community engagement can also be another form of advertising in your gym. Hosted or taken part in local events such as health fairs or charity fundraisers? Put it up on a noticeboard.
Perhaps celebrate the goals of an existing member? Or you could sponsor participants in the city marathon, create a fitness challenge, host workshops and even seminars with health specialists. All of these take time and cost money but they will certainly help you craft a compelling point of difference in the industry.
You could also establish partnerships with local businesses, corporate organisations and community groups. Offer rewards to their employees and associates, such as discounts. This will help you tap into a new audience and increase brand awareness with potentially unreachable audiences. In return, you offset the cost of their gym membership, incentivising them to sign up in spite of tighter budgets.
Targeted advertising and personalised outreach
Should social media start to yield positive results it’s time to develop your marketing strategy. Or you may feel confident enough to jump ahead without social media. Search engine advertising (Google Ads) will give your brand huge exposure although it does cost money. However, you can scale it to a budget, increasing it as more high quality leads come in.
Similarly, post print media such as leaflets and distribute them to local homes and businesses. Write a community newsletter and post it on a weekly, fortnightly or monthly basis. Whatever you do, make sure your content highlights the unique features of your gym and the benefits members get from it. Personalised outreach should resonate with your target audience on a personal level.
Direct all potential members from targeted advertising on email or social media messages. Promptly respond to inquiries and always give them information tailored to their fitness goals and interests.
When it comes to acquisition let referrals do the heavy lifting
Business and corporate partnerships
Targeted ads and personalised outreach
Help gyms differentiate in a highly competitive market and cultivate a positive brand image and reputation. However, these strategies tied together with a referral programme into a cohesive acquisition model, achieve so much more in producing highly qualified leads at a fraction of the cost of traditional marketing techniques.
By following the best practices listed in this guide, you will maximise the impact of your gym referral programme and ensure its longevity. The more we start looking after our bodies the longer we live. The same principle applies with customer loyalty. The more effort you put in and best practices you follow, the longer members will keep referring others to you.
And that’s your guide to 8 best practices to follow when setting up a referral programme to boost memberships at your gym. Any questions, tips or you simply need some more advice, don’t hesitate to give us a call or drop a line here.