Are you looking for valuable advice on pricing your fitness facility? With increasing competition in the fitness industry, making profits while attracting new clients can be difficult. Many businesses shut down before they can start functioning smoothly because of unrealistic pricing plans.
The monthly cost of running a gym can be quite high, and you need to make sure you get enough return on your investment. Here we have a comprehensive guide to setting the best fitness center membership cost. From factors to keep in mind before forming a price plan to effective pricing strategies, below we have included all you need to know.
Read on to get insider knowledge on this issue – it can make or break your business, after all!
Table of Contents
- Things to Consider When Setting the Best Gym Membership Prices
- Types of Gym Membership Pricing Models
- Expert Tips, and Tricks, and Strategies for Gym Pricing
- Making Your Gym Membership Worth Its Price
- Sample Prices of Popular Gyms Worldwide
Things to Consider When Setting the Best Gym Membership Prices
Before you determine the prices of your services, we recommend giving it some additional thought:
Find out About Your Competition
Competitive pricing is a smart pricing strategy for businesses that face considerable competition in the market. One of the first steps before setting prices for your services is analyzing your competitors. Identify the most popular fitness centers in your region, and learn about their membership prices and the value they provide to their customers. Compare their pricing schemes to get an idea of what your clients expect from you. Ideally, it would help if you also had certain unique offerings that make you stand out from your competition.
Once you know about the acceptable price point for people in your community, you can proceed further. You may either offer a slightly lower price or a better combination of services than your competition. Take care not to devalue your pricing too much – that can mean trouble for your business. However, offering seasonal discounts is a good idea when getting started.
Find out About Your Clients
Client research is a crucial step when evaluating your gym membership cost. Suppose there are plenty of people using your facility throughout the day. In that case, you have more freedom to decide whether to increase your pricing within a reasonable range or limit access to certain services on a standard membership. However, if you feel you aren’t getting the attendance you expected because you’ve set a high price, you can always bring it down to your market level in hopes of attracting new members.
It can also be helpful to study your gym members’ demographics. You must have some knowledge about your target audience from your business planning stage. It’s time to apply that knowledge to set the best gym membership prices.
Knowing the average income of people living in your community, especially the disposable income they tend to spend on various facilities in your area, can help you set a realistic price. Knowing the major age groups can also help you structure packages that attract young and old members. Your area’s population can indicate whether you can get a fair amount of attendance at your gym. You’ll be able to function smoothly as long as you keep generating revenue by attracting enough new members.
Determine a Realistic Profit Margin
The ultimate goal of effectively pricing your services is, of course, maximizing profits. While unrealistically high prices will put off customers, too low a fee can be equally damaging.
It’s best to calculate all your expenses from A to Z before you price your services. Add up your monthly rent, staff salaries, equipment maintenance costs, instructor fees, and bills. Now you can decide how much monthly revenue you need for a profitable business. This will give you a better understanding of the minimum charges you need to set for memberships. After analyzing your competition, you can offer a profitable price and attract your target market.
Determine Your Position in the Market
Positioning your facility will differentiate your business from those of your competitors. This means that you have to decide whether you’re going to be a high-end facility, a mid-range one, or a budget gym. Whichever category you choose will determine your services and price range accordingly.
If you need to charge fees that high-end gyms are currently charging, you’ll have to offer similar services as well. A wide array of facilities, state-of-the-art equipment, impressive décor, professional instructors, and more membership perks are must-haves for any luxury gym. The high price will serve to keep your gym exclusive only for the elite and will prevent congestion.
A budget gym, on the other hand, offers lower prices with just the basics. Smooth-functioning equipment and a bunch of fitness classes with an instructor or two is all that people expect from you. You can get away with bigger class sizes as well, due to the lower price point. Your primary source of earning from a budget gym is a greater number of members, after all.
Consider Having Multiple Pricing Plans
Nowadays, one fixed price for your gym membership may not get you very far. Many people tend to be selective when availing of fitness services. They don’t find it convenient to pay a full membership price when they can only attend a few classes. Structuring your price can be a good idea to avoid this inconvenience. You can get more signups when your pricing seems fair.
Many gyms provide multiple facilities along with a fitness studio at their centers such as a pool, sauna, or lounge. In such a case, you can offer different membership plans. For instance, you could set a lower-priced restricted-access membership for limited services and a higher-priced plan that is all-inclusive. For fitness classes, consider offering a 3-day class permit and a weekly pass so that maximum members can join in.
Select a Compatible Gym Management Software
A lot of your administration will be handled by gym management software. It’s a brilliant tool for any fitness facility that wants to function smoothly in this day and age. Such software can track payments, take care of class bookings, give valuable insights, and more.
It’s therefore essential to ensure that you choose a gym management software that supports your pricing model. It can be inconvenient otherwise since it takes unnecessary effort and time to switch systems or choose a different pricing plan when your software isn’t compatible.
Types of Gym Membership Pricing Models
Different gyms nowadays have various pricing schemes. The ultimate goal is to meet the needs of customers by proposing an excellent service-price combination.
The most common gym pricing model is a standard monthly fee charged to members who use a fitness facility. You can also allow them to pay up to a year’s expense at a time. This will benefit you in the sense that you get an idea about the minimum time you’ll retain those particular members.
With busy schedules and fast-paced lives, many people prefer not to commit to a specific period for using a gym. They find it unnecessary to pay for days they can’t attend, and that’s why the pay-as-you-go pricing model is becoming more popular.
This pricing model can ensure your gym users that none of their money is going to waste. This will likely keep them coming back to you whenever they can. Unlike the standard monthly membership, they’ll appreciate the money they save on days they don’t attend. You’ll also be their top choice if your competitors only offer monthly pricing.
Why not vary your prices according to your clients’ demands? Similar to Uber’s ‘surge’ pricing, dynamic pricing strategies can keep members visiting your gym while maximizing revenue. Here’s precisely how you can benefit from continuously changing the prices of your services:
- Generate maximal revenue. Dynamic pricing can keep your business running while making higher profits. This is especially useful in the case of gym classes – even if fewer people sign up, you’ll have to keep holding the fitness sessions for them. An excellent way to fill maximum slots in each class is to lure in more people by offering discounts. If you price your classes at flat rates and have empty slots left, it ultimately means you lose revenue you could have generated with a discount offer.
- Maintain consistent attendance all year. You can even out daily and seasonal demand by offering lower prices in off-seasons. While your gym may be bustling with members at the beginning of a new year, thanks to New Year’s resolutions, members tend to lose interest soon after. You can bring in discount offers after mid-February to keep attracting visitors even when demand is low. This will make sure you have a consistent influx of gym users throughout the year.
- Bring in new members. While a pay-as-you-go model is also a sensible approach from a customer’s perspective, nothing beats the charm of a seasonal discount. It’s a good way to attract visitors to your facility and get them to sign up as regular members.
It’s always necessary to slow down and test out dynamic pricing on a class or two before implementing it overall. Gym management software like MINDBODY and ClassPass can further help you with dynamic pricing strategies after thorough analyses of your business.
Special Discounted Memberships
Sometimes, offering discounts to certain kinds of people can be a great idea to generate business. You can provide special membership prices to college students, senior members of the community, or for certain medical purposes. You can also collaborate with companies to offer special employee discounts as part of a corporate wellness program. While it may seem costly at first, it often ends up being worthwhile when you gain new members.
Expert Tips, and Tricks, and Strategies for Gym Pricing
If you’re looking for a gym membership pricing strategy to boost business, here are a few tips:
- Free Trials
Guess what’s more appealing than a discount? Freebies, of course! With free trials, you can target people who don’t trust new businesses easily. You give them a chance to avail of your services for a limited time free of cost, then decide whether they’re worth paying for. Take extra care to make a lasting impression on such visitors. You may offer a free pass to one of your popular classes or 7-day access to your gym equipment. It’s up to you as long as you don’t go overboard with the freebies!
- Low Introductory Prices
Setting low introductory rates can bring in members who will hopefully stay with you for the long haul. It’s an effective marketing strategy to offer some concession for the first few months of membership.
- Referral Rewards
If you’re facing a lack of memberships, you can offer discounts as rewards to your members on each referral made. While this could be a freebie, waiving part of their membership fee for the month can also be a good option.
Cleverly designed packages can make sure you attract members and retain them for long periods. For instance, you can set a monthly fee as well as six-month and yearly gym membership packages that are of less value per month if paid together. This way, you’ll get paid for months at a time even if your gym members often get demotivated and stop coming back after a while.
Another idea is couple’s packages where you charge slightly lower when there are two signups at a time. This can again encourage people to apply for membership together, ultimately generating business for your facility.
List all the services and facilities you offer and determine how you would price them individually. You should then figure out some lesser-used services and ‘bundle’ them with your core services, like gym equipment access. Determine a total cost that adds up to a lesser value than the sum of the individual prices of the services. You can then market your bundle as a cost-effective offering to your clients. While many people may not end up availing of all services included in the bundle, you’ll still get paid for them!
- Optional Add-ons
You can set a standard monthly fee at a relatively lower rate, but make it clear that it’s limited to a few services. You can then set prices for other facilities you offer. Members can select the ones they would like to avail for an additional fee.
Ultimately, trial-and-error is what you’re left with. You may not succeed in effectively pricing your gym on the first try. If a particular pricing model isn’t working for you, switch to another, offer a discount, or lure in members with special-priced bundles. Track your pricing strategy and new memberships closely, especially for the first few months. This can help you figure out what works best for your business.
Making Your Gym Membership Worth Its Price
It’s always better to offer good-quality services at a slightly higher cost than slash down prices while giving members a poor gym experience. The following aspects need to be carefully considered when deciding prices. On the one hand, you’ll need to make sure that they’re well worth the price. On the other, you’ll need to set up membership costs that are high enough to cover your expenses while bringing in a fair profit as well.
Your staff’s salaries will likely be your biggest expense, after rent. Make sure to hire qualified members for each position since they’re the ones who will run your facility. It would help if you considered the salaries you’ll have to pay all your staff members before deciding on a price plan. Employing a good instructor can also pay off well since they’re the ones who will interact the most with your members.
Don’t compromise on equipment variety and quality since that’s the primary service you’re providing as a fitness facility. At least make sure to include upgraded models of treadmills, ellipticals, and other popular equipment. It’s best to equip your gym with some high-tech gym machines to create a good impression on your members. Wi-Fi and fitness app compatibility, touchscreen consoles, heart rate monitoring, Bluetooth audio, etc., are so common on fitness machines that most people expect them when visiting a modern-day gym.
Hygiene and Maintenance
It’s essential to take care of cleanliness, as is maintaining your studio in good condition overall. Make sure your equipment receives routine servicing and cleaning. Your exercise area, as well as locker rooms, changing rooms, showers, and other parts of the facility, should be cleaned regularly. Keep an eye out for any repairs or replacements, and follow through immediately to keep your gym in good shape. Always consider maintenance costs before deciding what to charge your members. After all, it’s their membership fees you’ll use to pay for such expenses.
Many modern-day gyms with higher membership prices compensate by offering added perks like a sauna, spa, juice bar, massage rooms, and more. Others may provide complimentary diet advice or seminars. Whether you offer such facilities is entirely up to your choice and budget, but make sure that your price matches your services.
Sample Prices of Popular Gyms Worldwide
If you’re still feeling lost about how to price your services, here are some gym membership pricing models of some of the best international fitness chains to give you an idea:
- Anytime Fitness: While charges vary with location, members must pay an average monthly fee of $36.5 in the US and $49 in Canada. Any additional costs are often unique to the various franchises.
- UFC Gym: After a $200 starter fee that’s required at the signup stage, clients pay $79.99 per month or $835 as an annual fee for a membership to any UFC franchise in the US, as of 2020. They also offer couples’ packages at a slightly lower price point.
- Gold’s Gym: Having locations in 22 countries, membership prices vary. They often tend to offer some monthly bundles with different charges and facilities included. To see a random example of how they have bundled their offerings to form a basic plan and higher-priced membership options, see their LA location prices.
- Planet Fitness: With their Classic membership fees as low as $10 per month, Planet Fitness also offers a PF Black Card membership with plenty of facilities and perks to make it worth the higher price. It’s known for unique offerings like the 10-day free gym membership for seniors on account of Seniors’ Day, 2019.
- Orangetheory Fitness: While classes vary with locations, the average monthly cost for Basic, Elite, and Premier memberships is $59, $99, and $159 for four, eight, and unlimited classes, respectively. They offer free introductory classes and an average fee of $28 per class. Add-ons include heart rate monitors (for rent and purchase).
These examples are to give you an idea of how millions of people are paying to use fitness facilities around the world. If you keep up your services’ quality, they’ll be glad to join your center and pay a fair amount for it.
Now that we’ve shared all the insider knowledge about effectively pricing your fitness services, you should be able to set the most profitable costs. Too high a price can increase gym membership cancellations, whereas undercharging can drive your facility in losses. Striking a balance requires strategic planning and organized thought. Once you do your research and make sure your prices and services match well, you’re ready to open for business!