In the fitness industry, just about everything is about small victories “right now” and, inevitably, sooner or later services like Groupon are going to cross your mind. I mean, what better way to expose people to your club than to get a little cash for them walking in and trying the club. At least, it’s better to get them to pay a few bucks than to have them take advantage of a trial pass for however many days, right?
Unfortunately, the bads outweigh the goods when it comes to promoting your fitness club on Groupon. Even though you will probably get some people that will take advantage of the offer you might end up no better than you were before you went the Groupon route.
First off, since we’re objective here, let’s look at a couple of “good” things about Groupon or other sites like Living Social:
- You’re most likely going to get a lot of people hitting you up for your offer, which is probably more than 50% off your regular price. Woohoo! People in the door means your charm and the amenities in the club will get them to stick around a lot longer to where you can get the regular price from them next month, right? Wrong.
- Your incredible deal will give your club exposure to new prospects that may not have noticed you before. Could be a good thing.
Now let’s look at the dark side:
- Attrition is going to be horrible. If you think the majority of people saving money from your Groupon offer are going to stay you’re probably wrong. You’ll most likely lose about 65% of those people (80% if you include all businesses that use Groupon).
- Most likely you aren’t making any money on the deal. By the time you take into account what it takes to administer to those new temporary members, they’re probably done in their first month, and they aren’t renewing.
- People are on Groupon shopping for “deals.” Is this truly the motivating factor for which they should be joining your club? Research shows that people stay longer when their first interaction with you is self-help motivated (emotional) and not money motivated (financial).
- If you’re “doing it right” you’re spending your advertising budget on ways to create customer loyalty. By making your customer experiences more memorable, you turn then into way more effective promoters than any coupon deal you can ever implement. Rather than settling for the best deal you can give prospects, why not focus most of your budget on the benefits they receive before and after they become a member. A “deal” very rarely creates loyalty within itself – especially when it comes to Groupon and your club.
And last but not least…
- Depending on what side of the fence you’re on when it comes to Groupon, it could compromise your image and branding.
The good thing about Groupon is it’s quick and easy… but quick and easy may not be the best route to attain and retain members. Think about your current member base; what if all of them came from Groupon specials? How many of them would still be members of your club if they did?
Sorry to start your day off with unpleasant thoughts. You can make your thoughts much happier by creating a much more stable environment for which you promote your club.