At almost every fitness industry conference I attend, the No. 1 problem I hear facing health clubs is retention. The proliferation of marketing and sales tools in recent years is exciting, if not exhausting to keep up with. However, retention technology has not evolved at the same pace, and that is likely because as an industry we still do not fundamentally understand how churn works. A recent quote from “The Churn Whisperer,” Greg Daines, changed the way I look at retention: “People don’t leave because they have a reason to leave. They leave because they no longer have a compelling reason to stay.”
As such, member rewards (“carrots”) likely have their place regarding retention. At Active Wellness, we effectively use different loyalty rewards programs with proven results. However, comprehensive rewards programs come with a cost. First, there are significant overhead and balance sheet liability considerations to think about when operating a full-fledged rewards program. Second, if a member reward becomes habitual, it has a tendency to become an expectation rather than motivation. When that happens, the reward is no longer a compelling reason to stay, instead it is simply another club expense.
Sometimes Science is Better than Technology
I’ll let you in on the secret: there is a way to run an extremely effective rewards program with limited expense. Pioneered initially for the treatment of addiction, the fishbowl technique, has become a popular motivational tool because of its surprising effectiveness. The technique is based on the premise that if you adhere to a desired behavior (e.g. exercise 4 hours a week), you get to draw a potential prize ticket out of a fishbowl (pro tip: it doesn’t have to be a fishbowl). This ticket gives your members a chance to win a prize; similar to the allure of a lottery ticket.
Hypothetical example: Our club runs an exercise challenge starting with 800 members. Each member gets a chance to win (in our example, 500 members ultimately complete the challenge and get the chance to win). About half of the “prize tickets” carry no monetary value and simply have a motivational message like “Nicely done!” or “Your prize is better health.” The rest of the tickets have small prizes listed on them, ranging in value from $1 to $20 (pro tip: service discounts are always good, as they also help bolster sales).
There is only one grand prize ticket. In our hypothetical, each member actually has a statistically low chance of winning the grand prize: 1 in 500. Yet, research shows (see sources) that this technique is extremely effective at compelling almost all participants to retain healthy habits — for instance, in the treatment of addiction, those enrolled in a program that used the fishbowl technique achieved considerably better results compared to those entering a classical program that offered no incentives. Furthermore, by introducing prize variability, the cost of programs are manageable and success rates are optimized.
The science: Our brains appear to get highly motivated simply by the allure of a reward, rather than the reward itself (this is why slot machines are a thing). Science also suggests that for most of us, the possibility of winning a sizable reward tends to be more effective than the guarantee of a smaller prize. Yet, most of us have limited lasting disappointment when we do not receive the sizable reward, because we understand the dynamics of the game.
Science in Practice
When designing your next fitness challenge, tap into the excitement (and cost-savings) of the unpredictable reward. If you would like to field test the fishbowl technique, follow these principles of behavioral economics:
- Mindfully choose your target population. Will you include all members or just certain groups (e.g. new members, those trying to lose weight, at-risk members)?
- Set the rules of the challenge and be fair. If you are not fair, the whole thing backfires. Do your best to truly randomize the drawing.
- Identify your “reinforcement” (the big prize). Try your best to pick something highly desirable for your target population. Use the same philosophy for the smaller prizes; for example, vouchers and/or gifts connected with your organization and/or community.
- Decide on the frequency of your drawings. For instance, will you do the drawing every week or every month? If existing motivation is low at your club, you can initially consider offering the incentives more frequently or include more small prizes so more people will win something at the beginning. (Remember, prizes only become an expectation when they become habitual; initially. the allure of any prize is motivating for most individuals at varying levels.)
Bonus tip: The drawing of prize tickets presents an opportunity to create an engaging social affair (as well as social cohesion among your members if done right). Get your members together and ignite a sense of “team” by turning the fishbowl drawing into an organized event.
Dr. Michael Rucker is accredited by the American College of Sports Medicine. In 2016, Dr. Rucker was recognized as one of the 50 most influential people in digital health by Onalytica. He sits on IHRSA’s Innovation & Technology Advisory Council. Dr. Rucker is a peer-reviewed author and currently functions as the Vice President of Technology for Active Wellness. You call follow Dr. Rucker on Twitter at @performbetter or visit his website: michaelrucker.com.
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