Success Stories

Relationship Marketing Weekly: Fitness & Health Club Edition

In this week’s Relationship Marketing Weekly, I interview Fitness Club owner Jason Alles. Jason explains how he doubled guest traffic, and increased member referrals by 300%… If you’re an owner, manager or in any way in the health and fitness industry, this is week’s FB live is just for you!

Kody: Welcome to our Relationship Marketing live show here on Facebook Live. I appreciate you all joining us. I’ve got an exciting, exciting message for you today. A great show, great guest for us today. This is Jason Alles out of Atlanta, Georgia. He is the owner of a fitness club. In fact he’s actually starting up several fitness clubs right now. Jason, welcome to the call.

Jason: Well, thanks for having me. I want to make sure I get one thing out of the way. Can everybody see that?

Kody: It says – bring it down just a little bit. Bring it down. Sean Graham in Atlanta is my mentor and hero. OK. Well, he must have put you up to that. So what do you get now that you showed us?

Jason: Well, originally it was going to be brownies. But we’re going golfing this weekend. So I will just take a couple of beers. That will be fine.

Kody: Hey, there you go. So Sean, we got that out of the way really quick. We’re only like less than a minute in the show and we already got that plug-in. Sean, a great mentor, has been a great mentor to you in implementing a lot of things we’re going to talk about today. So definitely hats off to him.

Jason: No doubt.

Kody: Yeah. So Jason, I would like to say welcome to the show. Now people joining us, they’ve been seeing this headline that said that you’ve more than doubled your guest traffic and increased referral business by 300 percent, which is pretty significant. Now, myself and most people watching the show today have definitely been members of a club and so we kind of – I know what guest traffic is because I’ve been a guest before a club. I’m sure most people listening have been as well. You were kind of educating me on how important guest traffic and referral business is. Can you just walk us through what a club traditionally does to gain that and then what you do to gain that?

Jason: Sure. So first of all, guest traffic is the life blood of any club. I don’t care what club is out there. They got to have guest traffic. They got to have memberships. So the typical health club model for advertising and marketing for years has always been direct mail. But when you’re spending 30, 40, 50 cents a piece, that can get pretty expensive. To be honest with you, most clubs don’t have that kind of budget.

Of course social media surely helps but ultimately really what you’re doing is you’re relying on support of your members to bring their friends to the club if of course they’re having a good experience and so – but most clubs, what they do is they reward their members by giving them free time. Oh, you brought a friend in. We will pay your dues for a month. The problem with that is you’re tapping into your membership due source. You’re tapping into your money. The second problem with this, let’s face it, it’s not very tangible. It’s not something you could touch or feel. The member really has no control over it because I guess – well, I guess that’s what I’m getting and maybe some clubs give away a T-shirt or something like that.

What I did – and again, I’m not trying to make fun here but Sean brought this to me a couple of years ago and I instantly knew how I could use this. One, we send it out to every new member that joins the club. So let me speak to that for just a second. We’re now doing it where we take a selfie, add it to the card. But even before over the last two years, we send them a thank you card. That thank you card and the bottom of it has a guest pass. The first month – now this is a club that I took over about 2.5 years ago that was seeing about 20 guests, 30 guests a month. Very following month, as soon as I started sending this out, we had 100 plus guests.

Kody: Wow.

Jason: And it isn’t just in one club. I mean I’ve done this at another club operation with seven clubs and it worked there just the same. So then what we did is we said, OK, sending it to new members – let’s face it. Nobody does. But how can we use this to encourage our members bring their friends? So we started a rewards system.

So what happens is if a person sponsors a new member, they get a card. Again, thank you for bringing in so and so. Here’s a $10 American Express gift card. Now one might think, well, $10 is less than the $20 dues. But here’s the thing is they can use it however they want to. A lot of times, they take their friend out for coffee for a $10 American Express. But then there are different levels. Bring two, you get a $25 gift card. Bring three, $50. Bring four, you get $100 and I have several people that have gotten the $50 one and so it kind of acts as a nice little incentive. But it’s also a little contest too because they’re like oh, I got one. I got two. Let me see if I can get to four or five. So that’s how we’ve used it successfully.

Kody: Yeah. I think you’ve touched on some really important key things not only for the fitness business but really for any business. You talked about the difference between an intangible touch and a tangible touch.

In your case, an intangible touch is hey, thank you for bringing a guest who joined. I’m going to give you your membership free next month. They don’t see that. They don’t feel it. They don’t touch it. They might think it’s cool and everything but it kind of goes in and out really fast and so versus sending them a greeting card, thank you card for the referral with a $10 American Express card and obviously they get it in the mail, they touch it, they feel it, they can use that card however they want and there really is some significance there and it showed up in your numbers. I mean it showed up in your numbers.

If you’re going from 20 to 100 in a month’s time, I mean numbers don’t lie. You know, numbers don’t lie. We can talk all day about how cool this system is of sending cards and gifts. But these numbers that you’re talking about, that doesn’t lie. I mean that’s powerful, powerful stuff.

Now you mentioned a couple of other clubs that incorporated it and earlier today, you told me that they stopped incorporating it. What happened?

Jason: So I was the vice president of some clubs here in Atlanta and names will be changed to protect the innocent. But at the time, we had eight clubs. We implemented the referral program as well as sending the cards to the new members and it worked phenomenally. So it wasn’t just my club that saw an increase. I’ve used this in several clubs. But again that was about three, three and a half years ago. Since that time – and I do believe that this is a direct effect. They’ve had to close two clubs because the numbers just fell off the table.

So the thing about this system – and I’m sorry. I get very excited and passionate about it because I can honestly say this card system saved the club that I just bought. There’s no doubt in my mind it saved the club and it’s going to save a lot of other clubs out there.

The margins on the health club business are so small and part of that is because you got a lot of overhead in running these businesses. But this is a program that could save a person’s business because it’s inexpensive. The value in it is phenomenal. It’s a wow. People get a wow effect. But anyway, so yeah, this club chain actually ended up closing two other clubs once they completely stopped doing the program. The owner didn’t think that it really was worth it. Not a problem. I use it and I’m killing.

Kody: Yeah, that’s great. Now Jace, one thing I love about Jason is that he – you are – you’re very passionate. You’re very passionate about your business, about your profession, the industry in which you work. You were mentioning to me earlier today the effects of a bad experience in a health club and how that’s different than a bad experience in maybe other places like a restaurant or something like that. Could you touch on that a little bit?

Jason: Sure, no problem. Well, I’m sure that there are people that are watching this that have had a bad experience in a health club. The difference between a health club and all the other industries is that if you go to a restaurant, say you go to Applebee’s – and hopefully no one on the line who works for Applebee’s. Let’s say you go in and you get food poisoning. Well, you don’t go home and say to yourself, “I am never going to eat in a restaurant ever again.”

What happens with the health club business is that if a person goes in and they have a bad experience with purchasing a membership, a personal training or something, all of a sudden, all the clubs get lumped into the same kind of deal and all of a sudden, they’re all, “Oh, I’m never going to go to a health club again.” That’s the benefit of this is that if you’re an owner, chances are nobody else in your market is doing this.

So what can you do to differentiate yourself from what everybody else is doing or in this case, not doing? So ask what this will do.

Kody: Yeah. So in other words, you will say, “I’m never going to an Applebee’s again,” but you’re not going to say, “I will never go to a restaurant again.” But it’s not that way in the health club business. I think we can all relate with that. Absolutely we can relate with that. What’s interesting too, this is – again, what I really like about you is that you – like you’re passionate about making sure that not only your clubs but the entire profession creates a good experience for people.

So you want to help the whole industry elevate the experience and so you’ve kind of shared what you’ve done with other clubs. There’s a lot of people on the call right now that would like to know how they could take this type of program to a club. What would you recommend for those people?

Jason: Well, let me first start by saying I’ve been actually in this industry for 30 years. OK? Since I was 15 years old. My dad was in the industry back in 1965. So I have a good sense of what this industry is.

This industry has lost sight of how to take care of its customers and anybody who’s listening, anybody – this is a market that is completely untapped. There are tens of thousands of clubs around this country that could benefit by using this and it’s very simple to roll out.

So hopefully everyone has got a pen and a piece of paper because as the old saying goes, the strongest mind is weaker than the lightest ink, right?

So step number one – and I’m not trying to solicit any business. Go join a club. It’s not the worst thing and I mean there are other – there are worst things you could spend $20 a month on. OK? But go through that experience of joining.

This way when you sit down and say, “Hey, I actually joined your club,” you got a little bit of credibility. But this is what my experience was.

The second thing is send a card. Maybe send two cards to the owner and/or the general manager. In that card, you need to put in there, “Hey, I love your club. I’m a member. If I could show you a way to increase your guest traffic and to increase your memberships, would you have an interest?” and then just your contact information.

Again, if I could show you a way to increase your guest traffic, increase your memberships, would you have an interest? Everybody out there is going to have an interest.

Now there are some owners out there, managers, who are going to be a little cynical. OK. Yeah, all right, whatever. This is why you have to be passionate about getting in front of those people and literally showing them how easy this is.

So again – and then the fourth step is literally have them pull up the last five members that joined the club. So let’s go in. We’re going to create a card right here on your laptop, on your phone, whatever the case may be, and then gauge and wait to see what happens with those – the responses that the people get.

Those five people will come in and maybe say on the card, “Bring this card in and get a free T-shirt,” whatever. Five out of five, people are going to bring that card in. You don’t have to sell the owner anymore. It has already sold itself.

But to finish up on that thought, this is an industry that is in dire straits of showing people, customers, how much we appreciate them. This is the tool that I have used. This is a tool that all of these clubs could use. I don’t want to say save the industry. That seems a little bit melodramatic, but really have an impact on people.

Kody: Yeah, no question. Well, and I will tell you, what’s cool about it is I want to make sure that everybody is clear on this. Thank you for sharing those four things with us. That will be valuable for a lot of people that are listening today. But I want to make sure it’s clear with everybody. Jason did not share that because he’s trying to sell a greeting card system which by the way we do have. You shared that because you really want the industry to elevate. You want to say, “Come on everybody! Let’s start treating people the way they should be treated and let’s elevate the profession,” because if you elevate your profession, it’s going to elevate your specific business.

Jason: Correct.

Kody: So I really appreciate that about you. Any final thoughts or words of wisdom from you as we finish up the show today?

Jason: The only thing I’m going to say is, is that first, this product is so easy for me to use. It’s so easy for my staff to use and the number one hurdle that you’re going to have to overcome with some of these owners is, “Oh, I don’t have the time,” or “How much does it cost?” We know it’s affordable. It’s $1.40 something obviously to go ahead and send a nice card. But it’s really simple and that’s the key. You got to show them how simple it is. What I do is I literally take all my members every two weeks, put them in a CSV file, upload them. Two clicks of a button, it’s done. Once you show them how simple it is, then it’s a no-brainer because believe me, every club owner out there is looking for more guest traffic and they’re looking for more membership sales.

Kody: Excellent. Hey Jason, thank you so much. I appreciate the time that you spent.

Jason: My pleasure.

Kody: All of you that – if you want to know more about what Jason is doing, get back with the person that shared this Facebook Live with you today and let them kind of show you the process. We’re simply trying to help people be kind to each other. That’s what we do. We help people be nice to each other and listen, we live in a world today that really, really needs that. We believe that it’s – what we do is far bigger than – although it’s great that we’re helping businesses, it’s far bigger than that. We really believe we can bring the human race together by sharing kindness with people and treating people the way they deserve to be treated.

Next week, we’re going to have a very special guest coming out of San Diego, California, Darla DiGrandi. She is going to – she has had massive success in the hair salon business and so, boy, wait until you listen to her stories in the hair salon business of things that she has done to dramatically increase that business. She actually sold a premium product, high end hair salon type of services that she offered and how she used this for that. So join us next week with Darla and again, Jason, thank you very much and we will see you all next time. Thanks. God bless everybody. Take care.

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