Fitness Is a People Business

The way to sell values is through human touchpoints for members with the people on your team who share them. Simple math demonstrates this every time. 

The most expensive mistake in fitness today comes shrink-wrapped on a pallet. It’s a $35,000 cold plunge or a $50,000 infrared sauna build-out or a recovery suite stuffed with hyperice boots and a red light bed. They’re all installed in the desperate and enthusiastic hope that members will finally pick you over the competitor down the road. 

They won’t. Not for that. 

The rationale for this misguided spending is there. The recovery market is on track to triple to more than $26 billion by 2035, according to research firm Fact.MR. But during the gold rush, everyone knew gold could be found in the West. Most people went broke digging for it, while the people who reliably made money were selling shovels. The shovel makers have evolved; now they sell recovery tech, and they have multimillion-dollar marketing departments built to convince operators that their products are essential in the next generation of the modern gym. 

With the emergence of wellness suites like La Fitness’ REZEN, Life Time’s Miora, and Optimize by Equinox comes media coverage, with that attention comes pressure on the franchises and independent operators to keep up. Soon, every gym is going to have its version of the fountain of youth — cold plunges, red light beds, saunas, recovery gear. You name it, everyone is going to have it. 

Once everyone has the same stuff in different packaging, the arms race becomes table stakes. It’s operating expense, with added complexity, which rarely sells memberships or keeps members coming back. 

Here’s what the industry’s amenity race keeps missing: members didn’t choose their gym for what’s in the building. They chose because of what the contents of the building mean about the business that operates it. They bought values. 

Having a sauna doesn’t mean you value recovery; it means you have a sauna. Having a membership journey that incorporates recovery would require much more thought to design aesthetic, scents, materials, etc. It would start in the marketing, it would permeate the staff, it would show up in every conversation, and it would end at the facility. Buying the amenity is akin to buying a guitar and calling yourself a rock star. Having a guitar doesn’t sell tickets.

And even if it did, the retention math doesn’t survive a capacity audit. Revenue per square foot is a critical number for operators to maximize. Every square foot of floor space taken for recovery equipment has to produce like the rest of the space without hurting member experience. With only 24% of membership reporting ever having used a piece of recovery equipment in a gym even once, it’s dedicating floor space and buildout to solve the wrong problem. 

The way to sell values is through human touchpoints for members with the people on your team who share them. Simple math demonstrates this every time. 

According to IHRSA/HFA, the 6-month churn rate of a member in a big box club is 50%. The same members retain at 87% over six months when they go through proper onboarding, which includes human interaction. 

Focus Digital 2024 puts CAC at roughly $200/member, and HFA reports the average monthly dues of a mid-market gym are $50.

When you apply these numbers, the picture it points to is clear. 

In the average mid-market gym: $19,000 loss on the first $100,000 earned, with a time to profit of about 9 months, accounting for CAC and OPEX. 

In the gym with human touch onboarding: $1,400 profit on the first $100,000 earned, with a time to profit of about 6.5 months, accounting for CAC and OPEX. 

The delta… $17,600 per $100,000 collected. And that number compounds as time goes on. 

The math is uncomfortable if you’re reading this as an amenity-first operator. Average lifetime profit per acquired member is about $255, and you think recovery amenities will bring down your CAC and/or increase your LEG. Maybe. But when you can hit the human touchpoints that make for great onboarding you’re going to see profit per acquired member jump to about $720. 

If you can hire, and develop people to execute a process that meets the findings of the research, the choice is simple. People will outperform the amenity most of your members didn’t join for and forgot about after their second visit. 

If you have confidence in your ability to outperform the research, well, then, which way to go really becomes more of an IQ test than a decision. 

We are entering the biggest era of disruption the fitness industry has ever seen. Clubs that used to sell access to great equipment and great trainers are pivoting to AI, peptides, and tech. 

When COVID hit, Peloton was the belle of the ball. Articles were everywhere talking about the death of in-person fitness. We all know how that turned out. In an industry where your competition sees their employees as liabilities and their trainers as transients who can’t be depended on, you have the opportunity to go against the grain. 

Declare values, build your entire customer experience around them, and overindex on a team who exude your values in every area of their lives. People will call you crazy, it will be hard, you’ll make mistakes, and you’ll question yourself along the way — but at the end of the day, fitness is a people business. It always has been, it always will be. 

For more than twenty years, Dr. Sean Pastuch has helped people reclaim the life pain has interrupted. His clients include elite athletes competing at the highest levels of sport, business leaders, and parents committed to building strong families with lasting legacies. As the founder of Active Life he and his team help people overcome chronic pain, think differently, and return to full participation in the lives they want to live. In addition to helping local clients, Active Life educates and mentors fitness and healthcare professionals around the world, developing a higher standard for helping people live without compromise.