Traditional gyms suck. I’m always anxious when I sign up for one of their plans and I think I finally understand what has rubbed me the wrong way this whole time.
Traditional gyms are built on a business model that has as its foundation, the failure of it’s members. If traditional gyms did a good job of delivering on their promises they would put themselves out of business.
To unpack this let’s look at the marketing message from a traditional gym:
“Come here and lose weight, we can help you get that six pack abs in time for bikini season. Look at these pictures of fit people as proof! Look, we know it’s hard, but if you come here 3 days a week you’ll get fit by running on this treadmill and lifting these weights!”
Alright, sounds like a good message. We can see people in the gym, doing their workout routine, and they are often fitter than we are. So we ask about the price. Turns out that we need to pay an upfront fee to join their gym… and that we need to sign up for full year ahead of time… and they want our credit card on file so they can automatically bill us afterwards… hmmm… that’s curious, but you can’t put a price on your health, so we’ll sign up and chances are, 3 weeks later you’re never going to set foot in that gym again.
Most of us consider that a personal failure. We signed up to get fit, we committed to 3 times a week, and we didn’t make it, and we feel bad. Here’s where it gets interesting though. That gym expects that to happen. They have even built it into their business model.
The reason they ask you to pay an up front fee, and sign up for a years worth of membership dues is because they know, you aren’t coming back. That seems counter intuitive but it makes perfect sense for them. You see they don’t have nearly enough space and equipment to service all of their members. They don’t have enough elliptical runners for every one of their members to use 30 minutes a day 3 days a week. There aren’t enough nautilus machines for everyone to get through the circuit in 45 minutes every morning. If every member of their gym came to the gym 3 times a week you would packed in there like sardines.
Why don’t they have enough space for everyone? Because they can’t afford it. Not at the rates they are charging you.
For example: A typical gym will have somewhere between 15-20 elliptical cross-training machines. Each gym member spends on average 30 minutes on each elliptical machine. Because of their work schedules, most gym members come to the gym between 5-8 in the morning between 11:30am-1pm during lunch and 5-7 at night. That equals about 6.5 hours of elliptical time, times 20 machines equals 130 hours of peak elliptical time per day. Divided by 30 minutes means that only 65 people per day can use the elliptical cross trainers in a small gym. Since we only need to go 3 days a week, if members always go to the gym on alternating days, that means the elliptical cross trainers can support 130 people per month. (sunday is usually a pretty slow day)
130 people per month paying a somewhat typical 70 dollars per month equals $9,100 dollars in income per month.
Let’s factor in just one expense… 12 dollars an hour for the guy at the front desk (gym needs to be open from 5am-9pm) times 16 hours = 192 dollars a day, 7 days a week = $5952 dollars per month.
Even if you double or quadruple the number of members that equipment can support (add in treadmills, the nautilus circuit, etc…) you don’t come close to covering the services you are offering, let along recouping your initial investment (each one of those machines costs in excess of 2000 dollars). The interesting thing though, is that gyms aren’t double or quadrupling that number. They are reaching membership roles that are 10-20 times that number. A small gym I once attended would typically have 30-40 people in the gym every evening, with a membership role of over 2000 people. (6.5 * 40 = 260 regular attendees per day)
So here is what I mean when I say that traditional gyms’ business models are predicated on failure. If that gym in questions had all of their members actively achieving their own personal goals (going to the gym 3 times a week and getting fit) the gym would have almost 200 people there every night. This gym occupied about 2000 square feet giving each individual member 10 square feet in which to exercise.
This is what I find so irritating about these gyms. They sign you up, and they hope you don’t show up, just keep paying your bill, and go home straight after work to watch TV and feel guilty enough to continue paying your membership dues.