Most group training fitness facilities are offering too many membership options when a prospect comes in through the doors and is considering signing up for a membership. When you present too many membership options, the prospect goes through ‘information overload’ and it makes it harder for them to make a decision and ends up confusing them. You want to be in a position where your prospects can make a simple choice for what makes sense for their time & financial situation.
What does it mean to ‘simplify’ your membership options?
If you are presenting more than two membership options to prospects interested in joining, you are most likely confusing the prospect, consequently missing out on new membership sales. When you ‘simplify’ your membership options, you are essentially just taking all of your membership options and narrowing down your options to two choices.
Why you need to simplify your membership options?
The goal is to offer choices that are your most popular options that members prefer, yet at the same time options that make sense for your financial stability. That would mean you want to make sure you are pricing your options so that if you were at half, two-thirds, or full membership capacity, your profit would be substantial.
Your best members have a high level of commitment to reaching their fitness & nutritional goals. Your best members also have a high level of commitment to you and your facility. When you are simplifying your pricing options, it is a good idea to have one of your two options having a high level of commitment (3 months, 6 months, or 12 months), for a lower price per month. Having membership commitment will aid your long-term financial stability and more importantly if things change in your geographic area or circumstances for your business, you will have a solid base of membership stability.
How to find the membership price ‘equilibrium’?
Equilibrium is a state in which opposing forces or influences are balanced. Applying equilibrium to the price of your membership options would mean you are finding the perfect price in which it makes sense financially for the prospect to move forward with your membership. The best practice to determine your price equilibrium for your membership options is to look at your sales conversion rate. Your goal is to convert 50% of your prospects that come in through the doors. If you are converting lower than 50%, it is a strong indicator your pricing is too high. If you are converting higher than 50%, it is a strong indicator your pricing is too low, and you have an opportunity to increase prices. Keep in mind, pricing of your options is something you will constantly be testing and something you can easily change. Overall, having the right pricing & membership options for your facility will yield you more long-term members and drastically improve your retention because of the way they were sold.