Pin-pointing how to effectively price your gym memberships to attract new members, retain existing members, while also meeting profit margin goals is a fine art. And it might take some tweaking and finessing over time to strike the right balance, but in time you’ll find a model that works best for your gym.
So what are some things you need to consider when choosing the right membership pricing model for your centre?
Evaluate the different pricing package options
Weekly/fortnightly/monthly payment plan
One common gym pricing model is spread out over a 12 month contract with a weekly, fortnightly, or monthly fee for members to pay. Many customers are accustomed to this kind of membership plan.
Sometimes offering an annual rate at a slightly discounted rate is another great option for securing instant revenue for your business while giving your member great value if they’re a regular gym-goer.
Pay as you go / casual class passes
Customers love the flexibility of being able to pay for a class or session when they need them, rather than paying a weekly membership fee when they know they just wont use your facilities regularly enough to see the value.
Offering this kind of gym pricing model and package can open up your services to a new target market and niche. The downside is it means sporadic revenue for you, so this pricing model is best paired with another pricing model that can guarantee you a regular revenue stream.
This kind of pricing model works by pricing your classes based on demand. For instance, you might choose to price your 6pm weekday pump class at $20 due to the peak time demand your gym may see. On the other hand, you might choose to price your Tuesday 10am Pilates class at just $10 a class due to a potentially quieter time in your gym.
Using third parties
Using third party services, like Class Pass, is another great gym pricing model to use in conjunction with your base line packages. Class Pass showcases all the classes available from participating gyms and studios, which their members can then book. It takes care of all the marketing for you by using their brand, helping attract customers to you and other fitness companies in their network.
Members pay a monthly fee to Class Pass, and for that fee they get to try out gyms and fitness studios within Class Pass network. Class Pass then gives a cut to your centre when a member books a one of your classes so it’s a great option to have on the backburner to reach a wider audience and gain a little extra revenue.
Analyse your existing or ideal customer
Take a look at what your existing customers are currently paying, and what they have payed at previous gyms if they’re happy to share that information during an initial membership consultation. Is it in a similar range or vastly different to what you’re currently offering? If that person then decides to not sign up with you, make sure to do a quick follow up call just to get some feedback and see why. That information could be super beneficial to your business moving forward, both in terms of pricing and other areas of your business.
Also take a look at what your ideal customer would most likely pay. If your gym is close to university campuses and a large part of your target demographic are uni students, then offering memberships for $50 a week may not be priced accordingly with what your ideal customer can pay.
Consider the competition (but don’t enter into a price war)
What kind of pricing models do your closest competitors use? What kind of contracts do they offer, and what perceivable value are members receiving for their fees?
These are all questions you should consider when evaluating your competitors and trying to find the right pricing model for your gym.
Be careful though that if your strategy is to always price yourself lower than local competitors in order to win over members, you could be at risk of entering into a price war with them where no one really wins. Focus instead on pricing yourself based on the value you offer – if you’re priced much higher than they are, make sure the value your membership offers reflects those higher fees.
Don’t forget, once you have a gym pricing model that works for your business and appeals to new leads, to implement a way to monitor and track your leads to help them best convert to a sale. MyMemberSales is a simple yet effective gym lead tracking system that can help you do just that! Click here to learn more today!