When your club is a $39-per-month club and a new competitor comes to town that charges $10 or $20 per month, you probably start worrying and asking yourself how you can compete.
The first reaction for many club operators is to differentiate your facility by showing that your offerings are better and more abundant than those of the low-priced competitor. Good thought, but the growth of low-priced clubs shows that many people are willing to go without expanded offerings to get a lower price.
The next reaction might be to market your club's exceptional customer service. But almost everyone says they have great customer service, so who is a potential member to believe?
The next thought is to lower your price. It's almost as if price becomes the differentiating factor. The problem is that owners of higher-priced clubs with many offerings and amenities cannot lower their prices to the same level as the low-priced clubs while still offering all of their programs and services. They would never make a profit.
After all these tactics fail, I often see one key component that remains critical to a club's ability to compete and differentiate itself, especially from low-priced clubs: design. One of the biggest product benefits the fitness industry sells is appearance. It is only logical that a club that sells aesthetics also should look its best.
So what is the visual presentation of your club? Better yet, how does your club's appearance make people feel? Most people buy out of emotion, so you need to ensure that prospects experience positive buying emotions when touring your facility. If a club looks outdated, how can it justify higher prices?
The problem is that most club owners think that on a scale of one to 10 for aesthetic impact, their club is about a seven or eight. In actuality, many clubs are a four or five.
Your environment needs to rank much higher to motivate people to join — especially when they are being asked to pay more than they would at a low-priced club. The inescapable fact is that few people will pay two to four times the monthly dues at a club that looks like a lower-priced club.
Elements such as refinement, colors, quality finishes, lighting, furnishings, signage, branding, social areas, well-planned-out space, and overall interior and exterior details now demand much more attention. Paying attention to these elements becomes one of the quickest and surest ways to increase what people think your club is worth and make it an added-value purchase.
You can make dramatic and visually inspiring statements without breaking the bank. It takes time, research, planning and creativity to find the right combination of elements that make a club look far more expensive than it actually cost to build. But doing so is a must for any club owner competing with a low-priced club.
Also, keep in mind that in any service industry, a certain pattern and cycle exists. First, a competitor decides to drop its price substantially lower than everyone else's. Sooner or later, another competitor follows, then another and another. Eventually, the market has multiple low-priced competitors. Now each of these low-priced clubs must differentiate themselves in ways other than price. And soon one, then another will start to offer more and more services and amenities as differentiators — and then they will have to raise their prices to accommodate the cost of the increased offerings.
Once again, however, the club that has the most impressive visual presentation has a distinct competitive advantage, provided they don't spend a fortune to accomplish this.
Lower-priced competitors force others to improve and change some of their key variables for success. One of the surest ways to make a substantial difference in a club's ability to compete is through a good design that makes people feel good, feel welcome and feel like they are going to have a good experience at the club.
Focusing on a strong visual presentation will move more people to want to be at your club, even though some other club down the street costs less. If enough emotion is stimulated, people will pay more. It is that simple and clear.
Bruce Carter is the president of Optimal Fitness Design Systems International, a club design firm that has created about $600 million worth of clubs in 45 states and 26 countries.