Management software has completely changed the day-to-day operations of the health and fitness industry. For Mark Fisher, the president and COO of Sport & Health in Washington D.C., the challenge has been adapting to software and compromising between how he feels the business should run and how the business can operate to satisfy the software. Fisher knows the market is continually changing and he has spent a lot of time, just like everyone should, to find the perfect software solution for his club.
Interview by Tyler Montgomery
New Software Trends
The biggest concern with management software is the constant growth, which in turn keeps clubs on their toes. “We see software continuing to deepen its role as an enabler of the club’s processes and operations,” said Doug Elkins, the chief information officer with ABC Financial. “Specifically, we see software becoming more adaptive and agile to accommodate the changing needs of the clubs.”
Clubs have been searching for a way to use Internet and software to interact with members more efficiently inside and outside the club. “The two most important trends are management software systems that are completely Web-based along with providing the ability to easily interact with their clients,” said Larry King, the owner and founder of Shape.net software. “Most clubs are searching for one database that contains all of their valuable client data.”
A lot of clubs are searching for software with a basic functionality that allows them to provide a high level of member services. Christi DeVoe, the director of product design at QuanComm, said clubs have been looking at Web portals for member self-service, data mining for business intelligence and configurable business rules and workflows. “Management software is a must, not an option,” she said. “You can’t really run a business without knowing your customers. Management software controls every aspect of your member data, from contract and agreement details, billing for dues and services, and member usage.”
“We see our members having the ability to manage their interaction with our business,” Fisher said. “They can get real time information about their account, schedule a class and program registration on their own.” Management software has allowed Fisher and Sport & Health to shift the weight off of their staff and focus on delivering a great fitness product and member experience instead of spending a lot of time on administration.
“The biggest thing that clubs have to be is PCI compliant,” said Susanne Nauseda, the client relations specialist with Twin Oaks Software. PCI, or Payment Card Industry, sets up a series of requirements designed to ensure companies that process, store or transmit credit card information maintain a secure environment. “There are still several industry software companies that have not met this requirement,” Nauseda added. “It will end up costing clubs money in paying non-compliance fees.”
Clubs have many uses for management software. “We use it for billing, member management, scheduling services, managing PT sessions, contract creation, facility management and program registration,” said Glenn Rappaport, the vice president of IT at Sport & Health.
Elkins explained that the partnership between the club and the software company should reflect the overall goal of the club. “Club management software should be an enabler of the club’s business,” he stated. “The key to this is efficiency of operations, security of data, and improved member experiences, and ultimately, improved profitability.”
Making a Profit
Just like any addition to a business, the biggest concern is profit. “Great management software provides important reporting tools that can help managers and owners effectively understand the key performance indicators that are important to running the business,” said Karen Wischmann, the president and CEO of Total Woman Gym & Day Spa. “It is important for us that our system provides us with real time reports in a variety of areas, including sales reports for the gyms, sales people, personal trainers and spa technicians.”
Having quality software helps clubs in many fascists of the organization. By hitting all aspects of the club efficiently, the club can more effectively turn a profit – which management software assists. “There are many benefits that I really consider mandatory if one is to run a profitable health club,” said Mark Plewa, the business development manager for Affiliated Acceptance. “Behind every smoothly operating club is great software. A great software suite should keep down attrition and generate new sales by keeping track of your facility tours, prospects converted to members, promotion tracking, e-mail blasts and tracking delinquents. Club owners really need management software that performs at the high level they do. “The benefits of your software should equal that of five full-time employees,” Plewa said.
A major benefit of implementing software into your club can be the ability to promote profit centers and generate new membership sales. “There are some features that allow owners to track all this info with up to the minute reporting,” said Brett Beshey, the president of Buddy Referral System, Inc. “These types of programs make sure nothing is slipping through the cracks and that you are maximizing dollars generated out of your new members and their friends.“
“Management software helps clubs ensure their members are paying dues and that only members in good standing are using the club facilities,” DeVoe said. Andy Wigderson, the vice president of sales and marketing with CSI Software, explained that clubs are discovering new solutions within their own businesses and finding newer needs for software. “Health and fitness clubs are finally coming to the realization that they do not need to use billing companies to process EFT and credit card drafts,” he said. “The technology that exists today in enterprise software systems obviates outsourcing to external entities. The cost savings in eliminating third-party processing fees is huge. Most of the large chains are moving in this direction and it is just a matter of time before it starts filtering down to the mid and small size clubs.”
Scott Johnston, the co-founder and CEO of InTouch Technology, explained that about 50 percent of people were still interested in a club 30 days after their initial tour. “In general clubs are a naturally chaotic environment where luck is a selling strategy,” Johnston said. “Because the clubs don’t have a guarantee that all leads will be consistently followed up a minimum of seven to 11 times, only about 20 percent of the people involved in the initial tour were actually contacted.” Management software can assist clubs in keeping in contact with all the people who take a tour of your club. It will help take the pressure off the owner but still contact prospective members for greater results.
Battling Retention
Retention has been the greatest topic throughout the fitness industry. Software management doesn’t completely fix the issue but it helps move clubs in the right direction.
“If used correctly management software can give a club owner a greater understanding of their business and the ability to adapt to changing markets,” said Barry Duncan, the co-founder and COO of Volo Innovations Inc. “Many clubs believe it is just a tool for billing. However, a good piece of software should help you increase member retention and revenues from existing members.”
Club management software helps clubs gain an upper hand on future and existing members by understanding their needs. “Management software gathers and stores information that is beneficial to making business decisions,” Nauseda said. “In addition, having integrated features like joining online, scheduling tied to point of sale and contract management, clubs can enjoy streamline processes that not only make the member and staff experience easier, but also ensure that proper controls are in place.”
Clubs spend a lot of money on marketing and trying to get members into their clubs. However, the lack of a quality sales team can create issues within the club. “Management software gives clubs the ability to monitor their sales team,” said Eric Gerdes, the COO and product manager for National Fitness. “Also, it gives you the opportunity to track members who aren’t using your club and allows you to contact them through e-mail and other outlets to get them engaged in your club.”
Getting Software
There are two hot topics with club management software. First, there are a lot of different types and companies to choose from – second, it’s needed to help run a successful club. “The program prices vary quite a bit,” Plewa said. “However, the amount of research a buyer puts into choosing a software package will greatly affect what they pay. It’s important the consumer understands that the most expensive software out there isn’t always the right choice.”
How much a club should spend on software completely “depends on the club size and business requirements,” said Rappaport. “You can spend too much if you’re only looking to check in members and you license software that will offer many more services you will never use. It’s very important to understand the business first and then ask the right questions to match the software.”
Fisher said clubs must evaluate their future. “For our company it is a vital capital investment and an integral part of the platform we are building our future on,” he said. “While we invest wisely and are cautious about overspending, we recognize the value in the investment.”
“Prices of software vary greatly throughout the industry,” Elkins explained. “Ultimately, before choosing a software platform, the club must decide on a billing philosophy. Though there are several hybrid options, the two basic platforms in our industry are do-it-yourself software/billing and outsourced.”
Elkins continued to explain that many clubs rely on management software to manage their entire front desk. “If the software isn’t available, members wouldn’t be able to check-in or purchase POS items or services,” he explained. “This is why it is vital in the conversion process to properly assess club’s hardware and network landscape among other things to eliminate or dramatically reduce the chances of any downtime.”
The biggest topic when bringing new software into your club revolves around price. “There is no one-size-fits-all when it comes to management software or how it is priced,” DeVoe said. “There are many pricing models, from the user-license model, where you pay based on the number of named or concurrent users of the system, to subscription models where you pay a monthly fee based on the number of members you have, and many variations.”
“To insure you’re getting the best bang for your buck, make sure the software you choose is expandable – plan for the future with a software that can be expanded as you grow and your needs change,” Plewa said. “Doing this simple step will ensure your getting the best deal for your most current situation.”
So many options with companies and types of software can make it difficult to make the perfect decision. “Owners have been asking for more ways to increase non-dues revenues in addition to member retention tools,” Nauseda said. “Another need, is booking and scheduling and tying in the online access for members and trainers – none of these things are inexpensive. Clubs have to be willing to invest in technology and use it to their advantage.”
Each club must do a lot of research to figure out what management software works best for its club. Owners will find that software management will be difficult to understand. However, when the proper amount of research is invested into the venture, it will align a club with the right software company to help turn a hefty profit. –CS
Software Tips:
- RESEARCH the software companies you are considering in great detail. Make sure they are can provide you with the right type and amount of software you need to run your club.
- PLANNING must exist within the leaders of the company. Define your direction for the future when searching for management software. You need software that can be compatible with growth as opposed to crashing when you expand your club.
- DISCOVER new opportunities within management software. You don’t want to get outdated software, you want software that gives you all the modern amenities.
- KNOW your members and what they need. Just like any other program in your club, you need software that can help you meet the needs of your members.
Susanne Nauseda has an exercise science degree that she put to use in the industry for 10 years prior to joining Twin Oaks Software, where she has worked for the last 12 years. You can reach her at 866.278.6750 or at snauseda@tosd.com.
Great article! At Volo Innovations we are so happy to be involved in this business and knowing that our software can help individual trainers all the way up to clubs take their business to the next level! Everyday we help the fitness industry grow and owners of companies of all sizes have success.
I will pass this great article along to our customers. At Shape.Net we manage every aspect of your club or facility, tailored to your needs, on a single unified database. From personal trainers to large chains, we can optimize your business and ensure optimal retention through powerful membership login and great follow up for one low monthly fee.