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Why Your Pricing Strategy Needs Re-thinking

What needs to be taken into consideration while creating pricing strategy?

Why Your Pricing Strategy Needs Re-thinking

The recent opening of a well-known fitness chain in my city caught my attention in the subject of pricing and membership. Convincing customers to try out a new product or service is certainly a challenging task for marketers and gym business owners. This is why gym business is even tougher as it has to tackle customer’s reluctance to commit through a membership and contract. Some pricing strategies will work for bigger volume gyms; some will be more suitable for boutique clubs. The clue is to know your customers, have a defined target for future set in your gym management software and work towards it with correct pricing.

Membership Contract

I am purposely bypassing the trial period for the big gun as this strategy parallels current trends in the market. Surely, it will be preferred by bigger health clubs. Contract signed for 1-2 years guarantees you a certain level of fee determined by a timeframe chosen and also preferable price after the contract expires. There can be extra rules applied such as contract suspension when a customer is sick or went on holiday. All in all, the strategy is simple and easy to market, gets immediate support in your software while applications help members to do monthly payments and check contract expiration date or upcoming due payment dates and guarantees you a high number of long-term customers.

Free trials

Since most people are not willing to spend money on a membership without trying out the services first, trial periods are useful to have in your arsenal. Every person has unique needs and offering free or discounted trials can give potential customers an opportunity to see if a facility suits their needs. The free trial period gives you, as an owner, a chance to make a good impression and convince a customer to stay with a full membership or even a contract.

Introductory rates for membership

Another idea influencing the number of new members coming in your CRM is to offer low introductory rates. For instance, a club could offer 10 - 20 percent off for the first six months after signing up for a new membership. An introductory period is a good incentive and can give customers time to get used to a certain routine before paying full price. Moreover, you can spice your long-term offer up with bonuses tied only with your APP. This will help you measure the results.

Month-to-month membership

But what if I am a student or I have flexible working hours and I would like to take advantage of it? Either I go for a long term contract for or I will look for more tailored discounted offers. This is when the month-to-month membership tactic comes as a perfect solution. The monthly fee may be higher than in the other membership contract option but it does not require as much commitment, it is easier to quit, and gives you a chance to diversify your offer towards different customer groups.

What is important here is to be able to combine payment plans and membership types with specific access rules. So, whatever strategy you choose, make sure your gym management software will support your goals and help you achieve these desired results. A professional software will be flexible enough to adapt to your business and marketing strategy needs.

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