Focus on Members

In a Tough Market, Customer Relations Is at a Premium

By Brian Summerfield


If you were between 15 and 50 years of age during the 1980s, chances are you remember a little show called Cheers. For the few of you who aren't familiar with it, this long-running sitcom was set in a Boston bar and featured a group of quirky regulars who always found their way into hilarious and embarrassing social situations.

The show's theme song, however, sounded a decidedly more sentimental note with lyrics about a place "Where everybody knows your name/And they're always glad you came." Perhaps without meaning to, the writers touched on the core principles of all great customer relations in that couplet: knowing your consumers on an individual basis, and being genuinely happy that they're frequenting your business.

For people who own and operate health clubs, relating to members on a personal level is more important than ever. "As corny as it sounds, this is the time when you want to know your members' names," said Bill Windscheif, vice president of gym development at national fitness chain World Gym International and founder of the consulting organization WinFit Enterprises in Lantana, Texas. "Don't let them feel like a number."

If you want to find out how to develop a customer relations approach that makes your members to feel appreciated and valued, read on.

Use Your Imagination

It's no surprise that in the longest and deepest economic downturn since the 1930s, some health clubs are struggling to retain members. In this environment, many people are taking a hard look at their finances to determine where cuts can be made. Unfortunately, club memberships are a common target.

Needless to say, this has prompted club managers to get more imaginative in how they engage with consumers. "The economy has definitely made it harder. Health club owners and managers have had to get more creative," Windscheif said.

Part of that creativity has been focused on attracting new customers, said Jarod Cogswell, general manager at ClubSport Oregon in Portland.

"Consumers are becoming savvier when it comes to sales," explained Cogswell, who added that they're hunting high and low for deals to limit their upfront costs. "Thus, we have been forced to be creative with membership promotional offers, but at the same time, have the ability to sell value vs. price."

In other words, no matter what specials you offer, don't undersell your value and keep your integrity intact.

To be sure, drawing in new members is important. But how do you retain the ones you have, especially in this tough market? It's actually quite simple, and no different from when economic conditions are great: Make sure they're using the facilities on a regular basis. One way is to offer a different mix of programs, such as group training sessions. Windscheif said World Gym has improved customer retention and engagement by implementing an expanded blend of programs.

Also, be specific about programming offered to members. The more involved they are with programs, the more value they get from their membership. "If a member consistently utilizes the facility and the club is a genuine part of one's lifestyle, then they will look for other ways to cut costs vs. eliminating their membership," Cogswell said. "If they don't use the club, they leave."

Personal Touches

Let's face it: Anyone can buy or lease a large indoor space and fill it with exercise equipment. That's the easy part. What differentiates a club is the level of service it offers. As indicated earlier, that starts with an organizational culture that views your members as unique individuals.

"Although we have extremely high facility standards and possess a huge variety of programming options, our ability to build relations with our members is our top priority," Cogswell said. "Our focus is on enhancing our member/staff culture and cultivating a sense of community. We aren't just a gym, we're a club, and it's important for each and every member to feel valued and that they are a genuine part of our community."

The technical term for this approach is "microsegmentation," or the concept of serving a market of one, said Roch Parayre, senior partner at strategy consultancy Decision Strategies International. "It's the brass ring of customer relations," he added.

Apart from individual customers, it's also important to have a sense of the different groups that comprise your membership and cater to them in communications and offerings. "You're not going to be all things to all people. It's important to identify your target customer group and cater to them," Windscheif said.

For example, if you serve a lot of families, it's essential to have high-quality childcare available for the children at the facility, Cogswell said. Another way to make these groups feel at home is to hire personnel who align to their demographic profile.

"Generational demographics and relations play a big part in our service success," Cogswell explained. "For instance, if your club consists of a large population of families or members aged 35 to 55, etc., then you need to hire people that fit those demographics and are part of your club's given community. Our success is mainly built on relationships, and having those types of people on staff helps maximize our service potential."

Local norms and customers also should play a role, Parayre said. "You can be a large chain, but the key is to have offerings specific to your locality."

Clubsport has made an effort to balance that corporate consistency and local flexibility as it has expanded, Cogswell said.

"For us, as we've grown, we've gotten more structure for the sake of consistency, but there's still a great deal of local flexibility," he said. "It is probably different for most large organizations, but fortunately, each property manager in our company has the freedom to do what's best to fit into our local market, while at the same time complying within the company structure and protocols."

It's Not a Club, It's a Lifestyle

Another effective way to attract consumers and keep them coming back is to be something more to them than just a product or service they patronize. As author, cartoonist and marketing guru Hugh MacLeod has said, "The future of brands is interaction, not commodity. It's not something you buy, but something you participate in."

The key to frequent usage, then, is to create an experience that members come to view as an integral part of their lifestyle—a place they want to go to rather than have to.

"Think about some of the little things you can offer that make it a destination, instead of something that makes members say, 'Oh, I've got to go exercise,'" Parayre said.

For instance, the club as a social venue is emphasized at ACAC Fitness & Wellness Centers, which is based in the U.S. Mid-Atlantic region. The members, particularly the senior segment, enjoy the interpersonal aspects of the club as much as the fitness, said Christine Thalwitz, ACAC's director of communications & research.

"We take the whole atmosphere into consideration," she said. "For example, we don't play music in our clubs—that's a very personal choice for members. Plus, they can talk to each other."

In addition to devoting large areas of its facilities to social interaction, "comfortable" dress is encouraged at ACAC clubs. The idea is that "real people" work out there, and that notion is reinforced in the clubs' promotional materials, Thalwitz said.



Performance Tracking: What to Look for

As the old business aphorism goes, "If it can be measured, it can be improved." But what should you measure? And how should you measure it?

For the former question, the critical issue is tying it to your organization's mission and goals. There will be variations between facilities and companies, but typically, that's going to involve driving revenue by attracting and retaining members. "A cornerstone of any facility is membership dues," said Jarod Cogswell, general manager at ClubSport Oregon in Portland.

Thus, attrition rates will almost always be an important metric. There are differences in opinion as to what a "normal" level of attrition of membership will be, but regardless of what figure you view as standard, it's useful to distinguish between controllable and uncontrollable loss of members, with the latter being due to things such as moves to other areas, job losses, family problems and the like.

As for the question of how to measure, the best way to find out how well your customer relations system is working is to go directly to the customers themselves.

"We have systems in place to collect feedback on a regular basis," said Christine Thalwitz, director of communications & research at ACAC Fitness & Wellness Centers. "Having a variety of tools for members to give feedback, both on a daily basis and on a larger, formalized scale, is very important to us so that we can stay in touch with our members and know how we can continue to serve them best. For example, we articulate a service standard of 'Exceeding Your Expectations' to our members and ask them to leave feedback for us on how well we are doing. We have a designated location in the club where they can fill out a form at any time sharing how an ACAC team member has exceeded their expectations or any comments, suggestions or complaints they wish to voice. The forms can be left anonymously or members can include contact information. All comments are read by club managers and the appropriate department heads. If contact information has been provided, a team member typically follows up within 24 hours.

"Our annual member survey is also a valuable tool in giving members a chance to give us feedback on all aspects of the club. Every member household receives a mailed copy of the survey, which asks for ratings of the facility, each individual department, what members value most about their membership as well as suggestions for improvement. We also ask the important question, 'How likely are you to recommend ACAC to a friend or colleague?' We compare results year over year, and it helps us with the big picture of how our members value our club and our services and programs."


Train, Execute, Measure

Of course, a robust culture is about people, and not just members. It's critical for your employees to grasp that culture, too, to the point where it's second nature, effortless. That assimilation is accomplished when the club's customer relations mindset and procedures are clearly communicated and reinforced through training.

For instance, ACAC maintains what it calls "member care commandments," which include keeping a facility painstakingly clean and—no surprise here—knowing members' names. Additionally, the company has an "own the complaint" policy that spans its entire workforce.

"Every team member who comes into contact with a customer can resolve any problem they have," said Thalwitz, adding that employees are trained to forestall likely difficulties that arise. As a result, any issues that come up are almost always resolved very quickly. "That anticipatory piece is often lost—clubs are often reactive instead of proactive in their approach to customer relations," she said.

In addition to training employees on club-specific service practices and standards, ACAC provides development modules on subjects such as conflict resolution and Myers-Briggs Type Indicator assessments. "With Myers-Briggs training, we find that employees benefit from understanding their own preferred communication styles," Thalwitz explained. "It also helps them understand how they perceive different situations and make decisions. This awareness also helps them recognize the preferences of those around them."

An emphasis on execution is key as well, Cogswell said. "We possess some of the best service protocols in the industry," he explained. "[But we] cannot control the execution without the right people. Structure means nothing without execution. It's my job as a GM to ensure that we are consistent in meeting our standards and the entire team has the discipline to play the game each and every day."

A central component of consistent execution and improvement in customer relations is constant measurement of personnel performance. This should involve a combination of soliciting anecdotal feedback and ratings from your membership, as well as close attention to hard metrics such as frequency of use, average client tenure, and retention rates. Together this information will give you a clear sense of how you're doing, and what needs to be improved.

Finally, be sure to create a system that rewards staff for excellence in customer relations and service, Windscheif said.

Conclusion

Times are tough, and it can be tough to maintain an intense focus on serving your customers with so much belt-tightening going on among both members and their health clubs. "It's a bit paradoxical: It's needed more than ever, but there are fewer resources than ever to do it," Parayre said.

However, while it might seem like you can't afford to do customer relations well, the truth is you can't afford not to. Even in a difficult financial climate, there's no shortage of consumers who will pay top dollar for deeper, more meaningful experiences with their fitness clubs. Thus, where service to your customers is concerned, be sure to follow Cogswell's approach: "We do not want members to feel the economic downturn while they're inside the building."



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