Using Your Broken Treadmill to Retain and Gain Members
Somewhere along the way to operating your club you’ve encountered some version of these statistics:
- Price is not the main reason for customer churn; it is actually due to the overall poor quality of service, as per the Accenture global customer satisfaction report in 2008.
- The probability of selling to an existing customer is 60 to 70 percent. The probability of selling to a new prospect is 5 to 20 percent, according to Marketing Metrics.
- For every customer complaint there are 26 other unhappy customers who have remained silent, according to Lee Resource.
- 96 percent of unhappy customers don’t complain; however, 91 percent of them will simply leave and never come back, according to 1st Financial Training Services.
- A dissatisfied customer will tell between nine to 15 people about their experience. Around 13 percent of dissatisfied customers tell more than 20 people, according to the White House Office of Consumer Affairs.
- Happy customers who get their issue resolved tell about four to six people about their experience, according to the White House Office of Consumer Affairs.
- It takes 12 positive experiences to make up for one unresolved negative experience, as per “Understanding Customers” by Ruby Newell-Legner.
- It costs six to seven times more to acquire a new customer than retain an existing one, according to Bain & Company.
What is service? One definition is perceived quality. You can apply this to all aspects of your organization, but let’s use it to solve a simple one: your equipment. It’s not enough for the operators and staff to believe the gym has quality equipment and services. Members need to perceive this quality as well.
Quality is a measurement of customer satisfaction that can be described from the customer viewpoint as “fitness for use.” Worn belts, noisy bearings and sticking cables can begin a process that leads to the above statistics.
Have an asset management system and processes in place to help the member log issues, then install workflows and processes to ensure the member knows it will be solved. Quickly resolving equipment-specific problems is an area where gyms fail to deliver satisfaction to the customer.
As the importance of satisfaction has already been established, it’s apparent this is an area where many gyms may be able to drive significant member retention improvements.
The problems in this area largely stem from both speed of resolution and the perception of that speed. Members understand equipment failure is inevitable. The mere occurrence of a malfunctioning machine is not enough to drop satisfaction levels significantly. Satisfaction levels only begin to drop when they perceive the equipment issue is not being resolved in a timely manner.
A resolution is defined as the act of resolving or determining upon an action or a course of action, method or procedure.
A resolution doesn’t require that the front desk staff or fitness instructors must be trained to immediately fix any problems they are presented. They just need to initiate a process that will get the equipment fixed in a manner that is acceptable to the member.