When Times Are Tough You Have To Get Close To Your Customers

Fitness Industry Association Manchester, England

June 2009

When Times Are Tough You Have To Get Close To Your Customers

“Welcome”

Creating Value

Useful

DesirableUsable

Value Creation

The Doom Loop

• New Direction, Program, Leader, Event, Fad, Or Acquisition… No Buildup; No Accumulated Momentum… Disappointing Results…Reaction, without understanding…

Build Up… Breakthrough

• Disciplined People

• Disciplined Thought

• Disciplined Action

Culture is sustainable, 

Personality driven is temporary.

The Flywheel

• Revolution means turning the wheel.

• People line up, energized by results…Flywheel Builds momentum…Steps forward…Accumulation of Visible Results

What do we really know about our members?

• Age• Gender• Address• Employment• Usage• Activity• Purchase patterns• Interests• Goals

How do you use the information to better service your members?

What do we really know about our NON‐members?

It could be as little as 30 minutes

An aquatics member using the club under her doctor’s prescription had her class time changed by 30 minutes – she complained and was not accommodated due to swim lessons being more profitable.  She cancelled her membership because this caused her to not be able to maintain her routine.  This is how fragile our solution is to people.  A 30 minute adjustment and she was out with NO plan to continue her exercise…

Can Be Trained Must Be HiredTechnical Skill InitiativeExercise Testing OwnershipSales Presentation AdaptabilityListening Positive ThinkerProblem Solving Bottom Line OrientedConflict Resolution AccountableGoal Orientation Visionary

Honest/Integrity

The Stockdale ParadoxAdmiral Stockdale

Retain faith that you will prevail in the end, regardless of the difficulties.

AND at the same time…

Confront the most brutal facts of your current reality, whatever they might be.

(Versus blind optimism)

Lewin’s Equation

B = Behaviorf = Function OfP = PersonE = EnvironmentB = f (P,E) 

Behavior is a function of the Person in his/her Environment

Successful Experience Design

• Integrates user & the club• It is learned but NOT open to introspection• It is invisible• It is multidisciplinary• It is cultural

We are still all learning how to design experiences & getting better every day!

What goes into designing the Member Experience?

• Good Clear Focus on 

Vision

• The Right People

• Feedback Loop

• Fast Iterations

UseDesign

Marketing Solutions Utopia –The Direction 

FacilitiesFeatures

Based

ConnectionFriendlinessWelcoming

Appropriate Specific Solutions

Programs and People

Results

This represents the evolution of our marketing and positioning.

As we move further towards segmentation, relationshipmarketing, weight loss, Wellpower, Habit Changer and new offerings - we will have a very strong competitive advantage.

No one is coming close to our targeted member focused approach!

*Marketing/Branding Path

Revenue Flywheel

Retention Through Member Knowledge& Unique Approach

Ancillary RevenueSolution Programs

No Barrier Involvement

Sales & Marketing

The US Health Club MarketClubCorp

Western Athletic Clubs

Sports Club LA

Sport & Health…

Equinox

TSI

Bally’s

24 Hour Fitness

LA Fitness

Gold’s Gym

Curves

JCC

Life Time Fitness

YMCA

Wellbridge

Who/What is Your Competition?

Designing the Member Experience

Experience IS the Product!

Good Design when well done is invisible

When it’s right you don’t think about it

Reasons Given for Quitting

Product Dissatisfaction

14%

Competition9%

Other Interests5%

Move3%

Die1%

Attitude - Indifference by

Employees68%

US News & World Report

Unhappy Customers who Remain Faithful

0102030405060708090

100

No Complaints UnresolvedComplaints

ResolvedComplaints

Quickly ResolvedComplaints

Purpose

We deliver quality fitness and wellness solutions that support meaningful change in 

people’s lives.

Mission

We deliver relevant quality fitness and wellness programs and while doing so, establish meaningful personal connections that support lasting and life‐changing results for our members.  

We leverage our expertise through multiple delivery channels including commercial health clubs, corporate partnerships and community centers.

Building Blocks to a great member experience

Say “Hi”

Be Responsive

Teamwork

Clean &Stocked

EquipmentUp-Keep

Say “Goodbye”& Good Job”

Have Fun

Our members come to us for a shared purpose-to improve their health and fitness. Help them escape the rigors of their day by showing your enthusiasm, friendliness and support. Reward their hard work, and we’ll be rewarded with their loyalty.

Help make fitness easy for our members by responding enthusiastically to any questions or concerns. Guarantee members a response within 48 hours and then proactively seek answers internally.

TEAMS understand the power of unity. We look sharp an act with confidence and serve our members with the utmost respect. When our members win, the TEAM win.

Work together to pick up towels, wipe down equipment, pick up paper and do the little things that keep our club clean, well-stocked and clutter free. A clean place is a better place to work and work out at!

Club One works on a 72-hour turnaround time for fixing equipment. Post signs notifying our members when they can expect broken equipment to be back in operation, alert your manager if equipment is not operable within 72 hours, and most importantly, be prepared to use back-up equipment so that our members continue to have a positive experience.

Always acknowledge our members for their commitment to fitness and for visiting us with a friendly “Thank you,” Goodbye,” “Hope you had a good workout,” or some other farewell. Encourage them to visit again soon.

Happiness is contagious. If you enjoy what you’re doing, your colleagues will enjoy what they’re doing and our members will have more fun.

Connection

Creating The Value Proposition: Wow or Delight

RetentionEnrollment

The Club TeamThe Organization

Our Purpose - Some Version Of:Improve The Quality Of People’s Lives

People Are Unfit And Would Like To Be Fit & Healthy

The Member

Connection

Customer Satisfaction = Results

Customer Satisfaction(Sales Results)

Staff Facility

Product / Service(Experience)

• New Sales• Member Results• Referrals• PT Revenue• Guest Fees• Program Revenue• Other non‐dues Revenue• Retention

Retention

Starts with the sales process and is only as successful as every interaction and touch point

Loyalty

Intervention Of At Risk Members

Every Thing You Do – Every Touch Point

Retention Model

Enrollment

On-Boarding

Connection

Members For Life

Reasons Prospects Buy Memberships to our Clubs

• To alleviate a hurt, pain or embarrassment

• Replace something that is missing

• To invest in the future

• To please someone else

Pleasure Pain Principle

We do things in life for one of two reasons:

To Gain Pleasure

Or

To Avoid Pain

Three Types of Prospects

• The Exerciser

• The previous Exerciser

• The non‐Exerciser

Facilities

Programs

People

OptimalMember

Experience

Cleanliness; Upkeep, HousekeepingAmenities, Maintenance, Equipment

Group Fitness, Personal Training, One StartSpecialty/fee-based programs

1st impression, Friendliness, Training, Membership Services, Service Desk Efficiency

The WOW Factor, Optimization of member experience

Facilities

Programs

People

OptimalMember

Experience

0%

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20%

30%

40%

50%

60%

70%

80%

90%

100%

Net Promoter Results

80% of total score are intangibles

0%5%

10%15%20%25%30%35%40%

2005 2006 2007 2008 2009

NP

19  26  32  39

Average For All Industries = 16

Contact Information

Bill McBrideChief Operating Officer

Club One, Inc.Bill.McBride@ClubOne.com

Bill_McBride@Comcast.net(Bill underscore McBride@Comcast.net)

“I hope this was helpful”