Your marketing efforts can quickly be wasted if your staff isn’t incentivized appropriately to sell to the new prospects. A big mistake many club owners make is to cut incentives or to have a knee-jerk reaction to someone who has earned a lot of commissions, and think that perhaps the salesperson is already earning too much. This seems to happen many times in the first quarter when a club’s sales staff tends to make more money due to the larger number of people coming in to purchase.
Let’s say you sit down at the end of the month and you notice that payroll is 50 percent higher than normal. You start thinking about how you can reduce that cost rather than considering the fact that sales have also gone up 50 percent. A lot of club owners will feel the need to adjust the pay structure, thinking it is a good way to manage expenses. But many times it has a much larger negative effect than planned.
If you reduce commissions in an effort to cut costs, you effectively force your sales team to have to sell more memberships to make the same amount of the money they did the month before. Your staff morale will be hurt and chances are good that they will lose motivation. Let’s face it, why do people get into sales? Because sales related careers are the number one income earning jobs in America. Why? Because people in sales are motivated by money — the more they sell, the more they make. Unfortunately, club owners sometimes forget that the more a salesperson makes, the more the club will ultimately make as well.
Another way to maximize your marketing efforts is to make sure everyone at your business can earn commissions, regardless of whether they are on the sales team, in childcare, teach group exercise or are part of the cleaning crew. I would much rather have my entire staff recruiting new prospects rather than simply leaving prospecting efforts to one or two salespeople. The reason is simple; your sales staff can’t be everywhere. By having the rest of your staff also helping to generate new membership sales and maximize marketing dollars, your health club will benefit immensely.
You should have incentives in place that cause your entire staff to want to promote the club, even when they’re not working. Imagine if a member of your staff is at the grocery store and overhears someone talking about losing weight or looking for a gym. The team member who has an opportunity to make an extra $10 – $40 will say, “I overheard you talking and I wanted to give you a gift card to XYZ Fitness. I work in the child care, it’s a great club, and I hope you’ll come in and check it out.”
If there weren’t any incentives in place, that staff member would likely have turned a deaf ear. But by offering them a commission, or some type of incentive, you are encouraging your staff to be an army of marketers everywhere they go.
Would you rather your few salespeople be marketing your facility or would you rather have your entire staff spreading the word? The answer is obvious, but you must have the incentives in place or it will never happen. That’s just the nature of the beast. If you think you are helping your business by limiting incentives and bonuses, you’re wrong. All you are doing is saving a few pennies now, but losing many dollars later.
As you are working hard to maximize your marketing dollars this first quarter, don’t forget to keep incentives and employee morale as high as possible. Even though it might hurt a little to see the extra line items in the expense column, it should more than be made up for with the extra line items in the revenue column. Reward your team and you in turn will be rewarded.
Curtis Mock is the host of www.FitnessBusinessTelevision.com the TV show for fitness entrepreneurs. He is also the executive director of gymsuccess.com. Curtis can be reached at curtis@clubsolutionsmagazine.com.
