Chris Cooper's Blog, page 49

The Not-So-Secret Key to Increased Gym Revenue

If you sell group coaching, I’m going to give you a simple “secret” that will help you earn more without raising your rates:

Start selling personal training.

This tactic is so simple—but it’s often forgotten by gym owners who focus on group classes.

Remember this: Our business is not group coaching. Our business is training people one on one. Sometimes that’s done in a group environment. 

If you’re running a group-only model, you’re missing some important facts: Some clients might prefer the privacy of a one-on-one session and get better results in that setting. Some might prefer the flexible scheduling. Some might have a special condition that can be accommodated better with PT.

Selling PT is a no-brainer in a gym.

In almost every case where PT sales are absent or low, the biggest obstacle in selling isn’t the price; it’s the gym owner’s mindset. 

To fix it, ask yourself this question about every single client: “What would help this client most if price wasn’t an issue?”

If you’re a skilled trainer, you’ll see that almost every client can benefit from focused, one-on-one attention—perhaps all the time but perhaps periodically in addition to group classes.

Focus on PT

If you simply add a PT option and tell people about it, you will sell a few PT sessions almost by accident. Some clients will want a session or two to work on a specific problem, like muscle-ups or double-unders.

A few group clients will be eager to add PT sessions as part of a recurring “hybrid membership.” And you might find a client or two who wants to do PT instead of group classes.

It’s easy to suggest PT in Goal Review Sessions with current clients (you should do these every 90 days or so).

In every case listed above, your average revenue per member goes up—a lot.

But most of your new PT clients are going to be new members. Selling a lot of PT to existing clients requires a change in consumer behavior that few gyms can manage. On average, about 10 percent of PT sales will come from your current clients and 90 percent from new clients who haven’t yet set the expectation that “fitness is done in a group.”

With new prospects, you must use free consultations—we call them No Sweat Intros. The process in simple: Interview prospective members, listen to their needs and prescribe the perfect solution.

Now that you’ve adjusted your mindset and aren’t just pushing people into group classes, it’s obvious that some new members will achieve their goals faster if they buy PT sessions.

Take Action

Here are two tactics you can use today:

1. Sell a Skill Session

Sooner or later, most clients in a group program will reach a point where one-on-one attention is required to address sticking points. You know this is true—I bet you can think of a client who needs your direct attention right now to fix some problem.

Here’s the value proposition: “You haven’t had a snatch PR in a while. I know some things that will help, but they’re beyond the scope of this group. Do you have a free hour to work on some really specialized stuff one-on-one with me?” 

Then book a skill session for $75 or more.

You just added $75 to your gross revenue and raised your average revenue per member.

2. Prescribe Personal Training in Your Next Free Consultation

After a prospective client lays out current problems and goals in your consultation, provide the absolute best path first regardless of price.

Like this: “I can help you! The fastest way to accomplish those goals is to train with me one on one three times a week.”

Then show them the price for your platinum package.

Some people will sign up right away. You’ll have to address barriers with others (we help clients with sales training). In some cases, you’ll have to adjust the prescription.

Like this: “No problem. If you can’t afford to move that quickly, we’ll take it a bit slower. With the budget you just gave me, I’d say we should train twice per week.”

Or like this: “No problem. With that budget, we can do group training three times a week plus a one-on-one session every second week.”

Quick Math

One-on-one sessions can help people when general group programming cannot. That’s your purpose as a gym owner: helping clients get results fast.

Your reward? More revenue. You deserve to be paid for the value you provide—and PT really moves the needle when it comes to revenue.

For example, if a gym is charging $165 for a group membership and a client buys one $75 PT session per month, the client’s value is now $240 ($165 and $75 are average prices in our 2023 industry report; you can charge more).

The best part: This additional revenue carries a significant profit margin if you use the 4/9ths Model: Pay a coach 44 percent of the $75 PT fee. The coach earns $33—more than the group-class rate in most gyms—and the gym earns $42 after labor costs have been covered.

A three-times-a-week PT package at $75 a session can bring in almost $1,000 a month ($225 per week times 4.3 weeks per month).

And yes, many Two-Brain gyms have clients who pay $500-$1,000 per month.

A final bit of wisdom from Two-Brain Business mentor Joleen Bingham:

“The best way to sell personal training is in a subscription model that renews month to month without any rollover. This model gives you the predictable revenue you need for your trainers and your business, and it gives the clients the accountability and routine they need to make progress and get results.”

So if you want to earn more from your gym, start offering or emphasizing PT.

The post The Not-So-Secret Key to Increased Gym Revenue appeared first on Two-Brain Business.

Paid Ads: Why You Might Want to Consider Them

Do you have to spend money on ads for your gym?

No.

You can succeed without ads if you use other tactics.

But paid ads aren’t evil, either.

When Two-Brain released its latest leaderboard for average revenue per member, I picked two gym owners and interviewed them.

I asked them how they earn more than $427 from each client—and I asked them if they’re running ads to acquire their clients.

Julie Lorenz runs ads, and Michaela Munsterman does not. Julie is working on her advertising skills and said about “it’s getting our name out there” right now. Ads aren’t high on Michaela’s to-do list because she’s getting great results from another funnel.

Both Julie and Michaela use referral marketing—aka, Affinity Marketing—to acquire high-value clients. That means they’re getting to know their clients and finding new ways to solve their problems. They’re connecting with the people closest to their clients, and they’re making incredibly valuable contacts in the local community.

Two-Brain founder Chris Cooper has done the same thing. In another recent interview, he said just a few important connections earned his business hundreds of clients and hundreds of thousands of dollars over the years.

I offer these examples as ground-level proof that high-ARM gyms can be built with various strategies—but you might consider referrals to be the backbone.

That said, ads can add fuel to the fire, and they’re worth considering at times.

Two-Brain teaches clients to use four marketing funnels. You might not need all of them, but if you learn how to use them, you can turn them on whenever you want. Top gyms often use all four of them at once and get impressive returns.

The Four Funnels

Here are the four funnels:

1. The referral funnel.
2. The content funnel.
3. The organic social media funnel.
4. The paid ads funnel.

These are listed in order. The referral funnel isn’t optional in a microgym. You must replicate your best clients.

I’d contend that the next two funnels are borderline essential. At the very least, they are well worth a small time investment.

The short version: These funnels can be linked together. Write a blog or publish a video/podcast every week. Chop whatever you publish on your blog or audio-video platform into chunks for social media. Post on social platforms three to five times a week, or more, but do it quickly and move on. Make sure you’re visible in the places where prospective clients are looking. Simple.

The last funnel? You might not need it if you have the first funnels running hot. But I’d suggest you should learn how to advertise just in case.

If you learn how to run ads and market your gym to strangers, you can tuck that skill away in your toolbox forever. You can use it when your gym needs clients or whenever you need to market to support any other project in the future.

Branding for the Win

You’ll note that some brands market when they’re trying to make sales and just to keep their name top of mind. It’s not always all about making a sale today.

Why do businesses do that?

Just in case. It’s no fun to try and build a brand fast when you’re under pressure and need to make money. It’s much easier to just invest regularly and keep raising your profile a little bit every day. If you do that, you’ll turn ice-cold leads into “people who have a least heard of your gym.”

That’s a big deal when you’re playing the long game, and your branding investment will generate handsome returns when you push a product or service to warmer leads rather than complete strangers online.

I’m a content person, and I’m not suggesting you must advertise. But I see the value in running ads.

If your gym is very profitable with the unpaid funnels running, why not invest a few bucks—maybe $5 or $10 a day—in digital ads that will amplify the effects of the other funnels?

Like this:

“Dad, I really think you should come check out my gym with me. It’s Mike’s Fitness.”

“You know, I’ve seen that name on Facebook. Looks like a great place that knows how to train seniors. I’m in!”

Prioritize your referral, content and organic social media funnels. But when you get them locked down, you might consider a small investment in paid ads.

At the very least, learn how all four funnels work, and make sure you know how to advertise so you aren’t scrambling down the line when you need to use ads and the pressure is on.

Two-Brain mentors teach our clients exactly how to build all these funnels from scratch. To learn more about that, book a call here.

The post Paid Ads: Why You Might Want to Consider Them appeared first on Two-Brain Business.

Average Revenue Explosion: From $70 to More Than $400 Per Member

Mike Warkentin (00:02):
How many members would your gym need if each one paid you $432 a month? Now I can hear social media: “No one will pay that. No one will pay that.” Kelly, do you think a gym can earn $200, $300 or even $400 per member, per month?

Kelly Lorenz (00:15):
Easily. Absolutely.

Mike Warkentin (00:17):
Aha. Will you tell us how you did it?

Kelly Lorenz (00:19):
Yeah. So, we increased our rates last year. So, we increased our rates by $10 per member, which is not a significant amount for each client. And that gave us an additional $1,200 or $1,000 a month. We added kids’ classes to our schedule. We added personal training, and we’re starting now to incorporate some small-group personal training into our weekly schedules.

Mike Warkentin (00:47):
Okay, so you’ve got a whole bunch of cool stuff there: rate increase, kids’ classes, personal training. We’re going to dig into that. This is “Run a Profitable Gym.” My name is Mike Warkentin. I talk to the best gym owners in the world every single month to help you run a better business. Please hit “Subscribe” wherever you are watching or listening. Now, Kelly Lorenz—she runs FORM in Marblehead, Massachusetts, and she’s here to talk about ARM, which is average revenue per member, per month. It’s a key business metric. Everyone on Two-Brain’s November leaderboard was above $400. The top number: $800, if you can believe that. Now, not everyone at the gym is paying 800 bucks—some are paying less; some are paying more, but the point is the average is $800. What’s a good first target? I’ll throw one at you: $205, but you can definitely move beyond that. Kelly has done it and we’re going to dig in. So, Kelly, talk to me first: How has this ARM number changed for you over time? As a personal story, mine was low; like it was like $113, $115, something like that, when I started my gym. I knew my rates were way too low in 2013. It took me to like 2018/19 to raise them with the help of a Two-Brain mentor, and then things started to go much better. But I started really low. How has your number changed?

Kelly Lorenz (01:55):
Well, we started low as well because I opened the gym on March 1st, 2020. And then 13 days later, I had to close the gym.

Mike Warkentin (02:03):
Yeah. What was happening in 2020?

Kelly Lorenz (02:05):
So, I had come from a photography background, and I had no idea what I was doing. So, we started doing classes online and outside. And I think my average revenue per member was probably—I don’t know—$50 at that time or 50 to $75, something like that. Once we were allowed to come back in, we started branching out different classes and some personal training. So, we added personal training to our schedule. And that increased. We offered hybrid personal training, so we did some group classes and some personal training for each client that was interested in doing both, and that raised their ARM incredibly.

Mike Warkentin (02:45):
Yeah. So, you’ve gone from like 50 to 70 bucks to north of 400 in like less than four years.

Kelly Lorenz (02:53):
Yeah. We also opened a second studio in our building. I took over two—unfortunately another business had gone out of business during COVID, so I swooped in there. And so, we just kept expanding with the new classes that we added and then, yeah, we just kept expanding, and we are where we are now. We just kept adding value to each member’s …

Mike Warkentin (03:17):
Aha. That’s a big one. I’m going to dig into the exact ways you did that, but give me the 411 on your business. What’s your—you hinted a little bit about where you started and what you’re doing. Give me like the—you know, what’s your ideal client? What are you selling? How much space have you got? Staff? Like just the quick rundown of what your business is.

Kelly Lorenz (03:31):
Yeah, so we are in a very small town, about 20,000 people, but it’s a very affluent town. Compare it to Nantucket in that it’s just—it’s a beautiful beach, coastal city, our town, but it’s small, and it’s very difficult to get in and out of the town. So, if there is something really great within our town, people will come to it. They don’t like to leave. So, we started with just me and like two other instructors—or three other instructors in one studio, and now we’ve grown to about 10 different instructors in two different studios. We started out mainly group classes, so small group classes, anywhere between like 10 and 20 people, give or take, on average. We’ve decided—we’ve since branched out and added value to each client’s membership using different strategies like personal training or small group personal training or kids’ classes.

Mike Warkentin (04:28):
Okay. So that’s pretty cool. So, I love that. It’s like—your town’s like the mob, you know: Once you get in you can’t get out. Right?

Kelly Lorenz (04:34):
Yeah, exactly.

Mike Warkentin (04:35):
I love it. It’s so good you want to stay. So, let’s—I want to ask about kids’ last, but tell me about the first things you said where you’re adding value through, like, changing from a group class model and even a rate increase. Talk to me about those two things and then we’re going to get into kids’ stuff after that because I know you’ve got a really cool thing going on there.

Kelly Lorenz (04:50):
Yeah, so we—well, I joined Two-Brain two or three years ago. Maybe two years ago; I can’t remember. And I just started—Jolene is my mentor—and I just started very slowly incorporating all of the things that Two-Brain told me to do. So, they encouraged me to raise my rates because they were too low, especially for where we are. And so, I increased everybody’s rates by $10, and nobody said anything. In fact, I got “Thank you for all that you do for us.” So that increased their ARMs significantly. And then I started to notice that different people had different goals that they were working on that they weren’t able to necessarily concentrate on in the small groups. So, via my mentor at Two-Brain, Jolene kind of worked with me and taught me how to start incorporating small-group personal training, as well as personal training, one-on-one. And that—the one-on-one personal training has been really valuable to our clients. I also—it took me about two years to get on board with the on-ramp sessions in my gym, and I have finally started to offer on-ramp. That was a scary one for me, and I’m still probably not charging what I should charge, but little baby steps here.

Mike Warkentin (06:02):
That’s okay. You know how to raise your rates now if you need to.

Kelly Lorenz (06:05):
I do. Yep. Yeah.

Mike Warkentin (06:07):
Okay. So that’s interesting because we had a similar thing where I started group classes, right? Excuse me, group classes. And I didn’t think that there was anything else. Group classes were the best thing ever, and we’d put everyone in. It’s an economical rate, and away we go. And I didn’t realize, first of all, that I was hurting my business because I wasn’t taking in enough per person. Got into financial trouble, had to call Two-Brain. But then on the other end of it, I also didn’t realize that my clients would’ve probably got better results if I had said, “Hey, you could book a personal training to work on this thing that you want. Or maybe you don’t want group classes; you would just like personal training, so we can focus a hundred percent on you.” When we started adding that, average revenue per member went up. And this is not uncommon, I’ve talked to so many gym owners: The second they start adding specialized services, they realize many of their clients actually want that. And then, additional people outside in the community really want that. And maybe just that or a combination of group and personal training. So that must’ve been your experience, I’m guessing. And did you see when you started adding this stuff in, you said the average revenue per member number started to move quickly?

Kelly Lorenz (07:05):
Yeah, it started to increase significantly. And that was really cool. Yeah, it’s hard to ask for such a—you know, a lot of money. And so, I’m trying to get my brain around recognizing that we actually have a lot of value to offer our clients. And so, it’s just kind of like a mind game really.

Mike Warkentin (07:24):
I recorded a show about this yesterday, and it was another person on a leaderboard, and it was in—her name was Michaela Munsterman. And she said—I asked her the same question. She gave me a really cool exercise, and gym owners check this out: She said, “If you’re worried about your value, write down everything you do and actually write down the service you provide and everything that you do and all the effort that you put in. And then look at it and ask yourself, ‘Is it really worth a hundred dollars?’” And if you do that, you’re probably going to look at—isn’t that cool? I thought it was such a cool way to frame it. And she said, “When I looked at that, I realized I was undercharging. I was hurting myself. I was hurting my staff. I was hurting my clients, essentially because I was underpricing everything. It wasn’t the right thing to do.”

Mike Warkentin (08:01):
So that’s a cool exercise. Write down what you do and the value that you deliver and then ask yourself if the rate you charge is right. And in many cases, it isn’t because gym owners are very prone to undercharging, not overcharging. I want to know about the kids’ programs. So, this is like adding personal training in individual semi-private stuff—that works so well. And we’ve known that; I’ve talked to so many gym owners. Talk to me about kids’ programs because this is an obvious one, but not a lot of gym owners do really well with it.

Kelly Lorenz (08:26):
Yeah, so this is—I come from a teaching background. So, a bazillion years ago, I was an elementary school teacher, and so kids have always been my passion. And when we went through the pandemic, I needed extra income and so families were allowed to hang out with each other, but no one else, right? So, we created a group called “Mini-Roadrunners” where mothers and our caretakers and children—so mothers and daughters basically—could go running outside with us. So, we did like a loop around town and generated business through that, as well as getting kids moving during the pandemic. So, through that we had a lot of contacts. A lot of our parents, or a lot of our members, have kids. And so, with the affinity marketing, right—that Two-Brain encourages us to do—we go to our clients and say, “Who else in your family can benefit from this?”

Kelly Lorenz (09:15):
“Who else do you know that can benefit from moving their bodies regularly?” And so, I had parents calling me or texting me or emailing me, asking me—because right now there’s a break between organized sports in our town. So, you know, there’s nothing from December until March. So, we decided to do a 10-week program for seventh and eighth graders and then for ninth graders. And we charged $408 for the 10 weeks. They come twice a week and that just skyrocketed our ARM at that point.

Mike Warkentin (09:52):
Wow. So that’s an interesting one because at every gym there are parents; those parents have kids, and those kids always need something to do. And parents are always looking for great activities and ways to get their kids off the Xbox and moving. Right? It’s true in every single gym, yet many gyms—and we saw this in our State of the Industry data—many gyms don’t make a huge dent with kids’ programs even though they’re such a home run, and they’re right there in front of you. So, you said—I’m just going to try and recap this for listeners—you said you just simply went to your clients and said, “Who else can I help?” And then you carry the momentum from your 2020 pandemic program to get kids and parents moving, and you use that to grow a sizable kids’ program that just crushed it in this last month. Is that right? Or what am I missing here?

Kelly Lorenz (10:37):
No, that’s exactly right. That’s exactly what we did. We had parents just calling us because they had heard about our previous Mini-Roadrunners, and they work out with us every day, and they’re like—it’s important, you know, true to our name, which is FORM, we’re very, very insistent that people are moving properly within our space so that they can avoid injury obviously. And so, we want to teach kids how to do that too, because they’re constantly moving, right? But we want to teach them how to do it properly so that they can go into their teen years just with that great foundation.

Mike Warkentin (11:13):
So you mentioned affinity marketing. Listeners, that is the code word for using your current clients to get other clients. And it’s as simple as saying, “Who else in your life could benefit from my service?” Or something along those lines. Kelly did it with a specific aspect—looking at kids, right? And all of a sudden, she’s got a kids’ program. I did the same thing. We put up a kids’ program—instantly sold out at my gym because parents need things for their kids to do, and they’re only too happy to bring them into an environment where they have a trusted coach, and they know they’re having a great time. That was us. That’s Kelly. Yeah. And it’s a no brainer. It’s such an easy sell if you do it. Maybe you might need a kids’ training credential or something like that, but those are easy enough to pick up. The Brand X is a preferred provider that does a great job.

Mike Warkentin (11:51):
But there are many ways that you can get a credential to work with kids. And then once you’re doing it, you’re giving them a lifelong love of movement and fitness and so forth. It’s kind of a win for everyone. And how great is it when you have parents and kids working out at the same time? Let me ask you this: When you priced your kids’ program, how did you do that? Because many gym owners think kids’ program should be priced way too low, especially when you look at the cost of competing in sports or cheerleading or any of these other after school programs.

Kelly Lorenz (12:15):
To be honest with you, we’ve done four-week programs before, and we charged $99 for four weeks—one day a week. And then I just kind of priced it out with Jolene and presented it to her and said, “Is this a good price?” You know, to be able to pay my coach a great wage as well. Because we do the 4/9ths model with them, and then we just priced it out. This was going to be two days a week for 10 weeks.

Mike Warkentin (12:46):
I love it. So you ran it past a mentor.

Kelly Lorenz (12:48):
Yeah. It’s like $20 a class.

Mike Warkentin (12:51):
And there you go. And you ran it past a mentor. You made sure that you are covering your expenses. And the cool thing—you mentioned the 4/9ths model. Listeners, that is when you pay a coach 4/9ths—44%—of a program’s revenue. That means that the coach is not a cost; the coach is tied to revenue. And in the best cases, these coaches actively generate more revenue, which means that as the program grows, your business grows, but the coach also earns a better wage. And so, we’ll see coaches not earning just $20 per class, but earning $60, $70, $80 per hour because they’ve got this 4/9ths model in place. So, it is a really, really cool way for you to pay a coach and build your business at the same time. Did your coach, Kelly—or coaches—did they see pretty good hourly rates out of this?

Kelly Lorenz (13:31):
Absolutely. One of my coaches is a former collegiate lacrosse player, so she’s very sought out in our town. So, yeah, she’s definitely making a great hourly wage for this.

Mike Warkentin (13:42):
Okay. I love it. I’m going to ask you now specifically—you mentioned affinity marketing. Are there other ways that you acquire high-value clients? Like do you do any advertising, or how do you get these people in your gym at a high average revenue per member?

Kelly Lorenz (13:53):                             
We definitely do paid ads on Facebook. I haven’t dialed those in properly enough yet because they’re not great leads for us, but it’s getting our name out there. We also are very active in our community, so we did a lot of things during the pandemic to incorporate families and getting them movement. We sponsor different town events that we have. We get out there and move with people when there’s races in the town. So, we’re just very active in our community and talking with people and getting ourselves out there, and we kind of just go with—our biggest value is tied to Chris’s value, to Coop’s value, which is to just help people: help first. So, we will be in a coffee shop and talk to people, and we’re just word of mouth.

Mike Warkentin (14:37):
Yeah, so you’re local networking. Oops, sorry, say that again.

Kelly Lorenz (14:40):
Sorry. No, I’m sorry. We just make ourselves available to have conversations throughout the day.

Mike Warkentin (14:44):
So you’re local networking, and so that’s an extension of affinity marketing. One of things that Chris has recommended is that you just like grab a bunch of coffee and head to the business across the parking lot or next door or whatever and just say, “Hey, I run the gym over there. Here’s some coffee for your step. How’s your day going?” See where the conversation goes. Right? You may or may not get a client out of it, but at the very least that business is going to know that you’re an awesome person and you’re friendly, and they’re going to know you run a gym. Have you done something like that?

Kelly Lorenz (15:09):
Yeah, I don’t bring coffee, but I go to the stores, and I buy things.

Mike Warkentin (15:14):
This is—this works. Yeah.

Kelly Lorenz (15:16):
Yeah. I support them. I shop locally, and they know who we are because it’s a very small town, and I will go to the stores, and I tell my husband it’s part of my marketing budget.

Mike Warkentin (15:26):
But it is, and my wife has had the same experience. She—we’re in a small town of maybe 10,000 or 13,000, something like that. And I think she knows half of the small business owners because she goes in and supports them and especially the active living stores. So, you know, ski and snowboard stores and like active living, hiking, paddling—those kinds of things. They know her. And so that’s great when someone’s like, “Oh, I’d like to lose some weight,” in that store. They say, “Go see my wife.” In a small community, you can make a huge impact like that. And again, I’ll reference Michaela Munsterman, who I spoke to yesterday: She literally makes up, I believe it was homemade salsa, or she’ll do sourdough cinnamon rolls, and she’ll take them to local businesses, and she’ll stop in and start talking. And her market is specifically medical exercise. So, she’s the transition between a care provider like a physiotherapist or even a doctor and out of that care providing situation. So, she’s that transition where they’re not quite ready for just general apparently healthy activities. There’s a medical component here, and she approaches those businesses with specific gifts and just says, “Hey, how’s it going?” And introduces herself. Isn’t that neat?

Kelly Lorenz (16:22):
Yeah, that’s really cool.

Mike Warkentin (16:24):
I kind of wanted cinnamon buns after I spoke to her.

Kelly Lorenz (16:26):
A hundred percent.

Mike Warkentin (16:28):
So ads—you said you use them a little bit, but you haven’t got them quite dialed in, but it sounds like you’re growing and doing okay without them, so when they start moving and get you the leads you want, you’re probably going to be in a very good spot, I would guess.

Kelly Lorenz (16:39):
Yeah. Yeah. We’re in a really cool spot. It’s humbling.

Mike Warkentin (16:45):
Wow. And it’s a neat combo because advertising is important, but advertising—like those are essentially cold leads. Even if you get the very best leads from an ad, they’re still colder than your client’s brother, sister, child, parent. Right. So, when you—let me ask you this, when you, maybe not with relation to kids obviously, but when you get a reference or referral, pardon me, from a client, how easy is that sales conversation? I’m going to guess it’s pretty easy.

Kelly Lorenz (17:09):
So easy. Once we get them in our gym for the NSS, for the No Sweat Intro, we book like probably 99.9% of them.

Mike Warkentin (17:18):
It’s a home run. They want to sign up, right? Because someone already told them it’s amazing.

Kelly Lorenz (17:20):
Exactly. Exactly.

Mike Warkentin (17:22):
So that cuts down on your sales time. And again, we’re not saying you shouldn’t advertise. You definitely probably need to do something like that at some point, but there are a number of different funnels. Two-Brain teaches four: One of them is advertising. The other three don’t involve spending a ton of money. They are referrals and contacts, social media, stuff like that. Let me ask you this, are there any simple add-ons you have with your business that drive up ARM? Probably things like renting lockers, apparel sales, supplements—anything like that?

Kelly Lorenz (17:44):
Yeah, so we have a little—I started doing pre-orders for swag with our logos on them. So, sweatshirts and sweatpants, stuff like that. We also have protein, like the little protein sticks and LMNT—what’s the word—Electrolytes. You know, those kinds of things. You know, little add-ons like that. But no, and we just had a call in Tinker yesterday about this, and people selling protein powder. We’re not a CrossFit gym, and we don’t have a bunch of dudes in there crushing their protein powder every day. So, we’re trying to figure out how to increase that a little bit more, but we do like a little retail area where we sell local things from local stores, that kind of stuff.

Mike Warkentin (18:27):
What a great way to build a connection, right? Hey, can I sell some of your soap in my store? Or something like that, right? And again, retail is not always a huge thing in gyms, right? A lot of gyms—like there are some, like say in Hawaii, Las Vegas, destination places—they make a ton of money off T-shirt sales because everyone wants that, you know? Local flavor. The places where I was weren’t really destinations, and a lot of places are like that, but still tacking on 5% or 7% in retail sales. Why not? Why not do that? And the other thing is—yeah, you’ll take it, right? It’s a little bit extra. And the thing is this: If you’re not selling supplements or anything like that, your clients are probably going to buy them somewhere, and why not get the good ones from you with the right advice and the “help first” mentality then going to the mall where the dude is like, “You need all this stuff, and you need to take twice as much as the recommended,” you know, that kind of thing, right? Apparel—everyone loves apparel. And the big tip here, gym owners, is reorder. Do not stock excess apparel or lose all your income because you’ve got unsold bad sizes or weird styles. Get a simple apparel order, pre-order, get only what you need—maybe like four extra of the most popular size—sell it, and you’ll make money. I lost money on apparel for a decade until I started doing that.

Kelly Lorenz (19:35):
Yeah. Yeah.

Mike Warkentin (19:37):
So I’m going to ask you this as we close this out. I always hear this. I see on social media whenever Two-Brain posts something like this: “$300, $400 average revenue member—it’s impossible. I could never do that.” Can you give me a couple of baby steps? Because you started at 50 or 70 bucks. What are some baby steps that a gym owner could do right now if they’re at that level to start moving toward your level? And let’s start with a first goal, even of 205.

Kelly Lorenz (19:57):
Raise your prices, even by just $10. We have a very small studio, and so we have around a hundred members—between a hundred and 110 members. So, even just raising $10 a month, that’s so easy. You know, you get an email; you send it out. You say—if you send it out in January—“Beginning in March, we’re going to raise our …” You know, a nice little email to let them know ahead of time. And then start asking people if they would like to start adding in one or two personal training sessions a week for 30 minutes. That’s an additional—you know, we charge $59 for 30 minutes. That’s nothing; that’s a couple cups of coffee, at this point, a week.

Kelly Lorenz (20:40):
And just ask them, you know, like, “I noticed you’ve been working on your planks. Do you want to continue working on that? Let’s get you in and get you some upper body strength,” that kind of thing. And just one of the things that I pride ourselves on is I’m there every day. I’m at the gym every day. I don’t teach classes, but I’m at the gym. And so, I know my clients and so I can say to them, “Hey, I’ve noticed that you’ve been really working on this. Would you like me to pair you with a trainer and do a hybrid membership once a week, twice a week?” That kind of thing.

Mike Warkentin (21:10):
Now that Kelly, that sounds like high-pressure sales. You’re really grinding these people.

Kelly Lorenz (21:14):
And then the other thing is goal review sessions. When we sit down with them every 90 days—which I’m really not good at, but I need to get better at—I can say, okay, “You’re on a starter membership. You’re here two days a week; why are you not here three days a week? I noticed that this is a priority for you.” That kind of thing. Just a conversation.

Mike Warkentin (21:30):
These are simple tactics, right? Very simple tactics. And they work if you do them. And you mentioned 90-day goal review sessions. Two-Brain recommends that you meet with clients every 90 days and just ask them how things are going. And it’s a great opportunity to just, you know, retain them by saying, “Hi, I love you.” And you know, take a picture and celebrate their successes, remind them of their successes. But it’s also a great way to say, “You know, if you want to move faster, we can do personal training and nutrition,” or whatever—whatever your service package is, and you can move them up that chain. And it’s not by selling or gouging, it’s by helping them achieve a goal faster. And like I said, you know, Kelly’s doing high pressure sales by saying, “Would you like some help with your plank so that you can be stronger faster?”

Mike Warkentin (22:09):
“Well, yeah.” Okay. The session, right? It’s pretty easy. So that’s one thing. Rate increase is another one. All that increase goes to your bottom line. And again, this—inflation is crazy right now. This is a thing that business owners do have to think about, but I’ll tell you this: It’s best to do it with the help of a mentor. Two-Brain has an exact plan. It’s been tested: the language, the email, everything you do and the support from a mentor, it’s all there. And all you have to do is follow the plan. And we even have percentages of calculations to help you figure out what you need to do to make your business profitable and how to do it properly. Because in some cases, if a gym is really low, they have to come up a couple of steps—and we’re not just going to add in a hundred-dollar rate increase. But an annual increase can be a really good thing, especially as prices rise. You said your clients—when you did that, Kelly, no pushback?

Kelly Lorenz (22:52):
None. No pushback.

Mike Warkentin (22:54):
And that was a $10 increase. Do you do it every year?

Kelly Lorenz (22:57):
No. What I was going to say is—I will say that if I followed the Two-Brain methodology, if I had more courage and followed the Two-Brain methodology like word-for-word and actually implemented it all, my bottom line would just skyrocket. It’s taking me a little while to get there.

Mike Warkentin (23:16):
That’s okay. That’s only one of the things you can do to increase ARM, and you’re finding other ways to do it. Eventually you’ll circle back and maybe it’ll be the right time, but right now, pushing a kids’ program sounds like a pretty great way to raise ARM and just sell a little bit extra to a family.

Kelly Lorenz (23:29):
Yeah. Thank you. Yeah.

Mike Warkentin (23:31):
So you mentioned two ways that you did that—you increased ARM. It’s with that rate increase or with hybrid programs where you’re tacking something else onto a package, meaning like maybe nutrition services, maybe it’s a personal training session, or maybe it’s like a semi-private, something like that. Anything else that you think a novice gym owner might want to consider? Or are those the two big ones?

Kelly Lorenz (23:49):
I think those are the two big ones.

Mike Warkentin (23:51):
Let’s leave it there then. That’s perfect.

Kelly Lorenz (23:52):
Checking with your clients, checking in with your clients—I think is an extra added value that corporate gyms don’t necessarily have.

Mike Warkentin (23:59):
If you do it, you will retain more members, and your revenue will go up. That’s proven in Two-Brain data. It happens. I think the average is something like 30% of members upgrade by about 30% in those goal reviews. I believe that’s the stat. Have you seen something like—you’ve seen something like that?

Kelly Lorenz (24:14):
Yeah. Almost every goal review session, somebody increases something.

Mike Warkentin (24:17):
And even if they don’t buy anything, they’re going to see your face, and you’re going to solve problems, and they’re going to stay longer. Has your retention increased from those as well?

Kelly Lorenz (24:25):
Absolutely.

Mike Warkentin (24:26):
Absolutely. So this is a no brainer, gym owners. If you take one thing from this show, consider making sure your rates are lined up with your value that you’re delivering and do goal review sessions. Kelly, thanks so much for being here today. I really appreciate it. I can’t wait to see what you do next.

Kelly Lorenz (24:39):
Thank you. Thank you so much for having me. It’s such an honor.

Mike Warkentin (24:43):
You’re very welcome. Are you done at two locations, or are you going more?

Kelly Lorenz (24:46):
I’m done.

Mike Warkentin (24:47):
Okay, that’s good. So, you maximize the ease and away you go. I love it.

Kelly Lorenz (24:50):
Yeah, I’m old. I need to start slowing down.

Mike Warkentin (24:54):
I don’t know. It looks like you’re only getting started to me, but in any case, we’ll catch up with you soon. That was Kelly Lorenz. This is “Run a Profitable Gym.” Thanks for watching and listening. Please hit “Subscribe” on your way out. And now here’s Two-Brain founder Chris Cooper with a final message.

Chris Cooper (25:07):
Hey, it’s Two-Brain founder Chris Cooper with a quick note. We created the Gym Owners United Facebook group to help you run a profitable gym. Thousands of gym owners, just like you, have already joined. In the group, we share sound advice about the business of fitness. Every day I answer questions, I run free webinars, and I give away all kinds of great resources to help you grow your gym. I’d love to have you in that group. It’s Gym Owners United on Facebook, or go to gymownersunited.com to join. Do it today.

The post Average Revenue Explosion: From $70 to More Than $400 Per Member appeared first on Two-Brain Business.

Average Revenue Per Member: The All-Time Force Multiplier in Gyms

Why is average revenue per member (ARM) so important?

Because it’s an incredible force multiplier in a service business.

Here’s your mental exercise for today: Take your current ARM and double it.

Now ask yourself this question: What if every new client came into your business at that rate?

What would that do for your business—and your life?

And just in case you’re skeptical about the “double it” exercise, you should know that our Top 10 gym owners for ARM scored between $430 and $800 in December 2023.

So large ARM numbers are possible.

High ARM at Ground Level

Most microgyms are a long way away from $400 ARM. Some charge less than $100 per member per month. Others sell group training for about $165—the average monthly price in our “2023 State of the Industry” report.

Let’s put that into perspective:

If you get 10 clients at $165 a month, the No. 10 gym on our leaderboard can make more with just four clients.

Think about acquiring 10 clients:

You must get a bunch of leads—perhaps by spending money on marketing or time and effort on referral networks—and you must convince some of them to book free consultations.You must get the people who book appointments to keep them (not all will).You must close 10 sales—and if you aren’t great in the sales office, you might need 20 or 30 appointments to do that. That’s a lot of time—and even if you go 10 for 10, you must spend valuable time in the sales office.You must onboard 10 new clients.You must work very hard to get the 10 new clients past the 90-day mark, when they are most at risk of leaving.

Ten new members also require more “stuff.” If you’re bulking up your client count, you’ll need more space and staff, and other expenses increase as well. Toilet paper is just one that provides a good example, but you can factor in chalk, retention “gifts,” increased wear and tear on equipment, and so on.

Member Count, Entrepreneurial Skills and Profit

Let’s go further: If a gym with $427 ARM needs 100 members to be very profitable—this is a random number used as an example only—a gym with $165 ARM needs about 258 to reach the same gross—but remember that more clients mean more staff, space, equipment, etc.

And here’s the deal breaker for me: Gyms with over 150 clients are almost always the gyms with the worst retention rates. It’s an extremely fragile model.

Gyms with lots of clients require top-tier owners, large teams and impeccable systems to run well. Many entrepreneurs just don’t have the skills to manage huge staffs and hundreds of clients.

Some Two-Brain mentees have a lot of members and work very hard to develop the skills needed to retain and manage them, but our data shows the average gym has about 159 members.

If you’re targeting a huge number of members, you’re going to fight an uphill battle. In reality, you’ll be better off maximizing value for about 150 members than chasing 300. Or you’ll be better off targeting 150 high-value members first, then deciding if you want to pursue larger numbers.

The good news: We’ve proven that you can make $100,000 a year if you have 150 members who pay $205 a month. Those are great first targets. If you hit them, you’ll make a good living, and you can make your next move from a position of strength.

Maybe your gym is running well and your systems are primed for more members. You can take that path if you want.

Or maybe you want to deliver more value and earn more with the same number of members. If that’s the case, drive your ARM up—150 members at $240 a person is $36,000 gross per month, or $432,000 a year! With a 33 percent profit margin—another good target—an owner can earn way more than $100,000 from that gross.

Why did I pick $240 for the example above? It’s the average group membership price—$165—plus one PT session at the average rate in our study—$75.

Could you sell 150 PT sessions a month to your current clients? What about 30 to start?

Deliver Value to Clients!

Remember: ARM isn’t about gouging or artificially driving up prices.

It’s about delivering value.

Your A+ coaching in a group setting is worth more than $150. What if you tack on a PT session and nutrition coaching? Or a kids membership for a family member?

If you can solve a client’s problems, you deserve to be paid for that service. So find the problems, create amazing solutions and boost your ARM!

The post Average Revenue Per Member: The All-Time Force Multiplier in Gyms appeared first on Two-Brain Business.

Top Gym Owners Reveal All: The Secrets of Huge ARM

Virtuosity in business is the theme of our 2024 summit for gym owners because I know mastery of the basics will help you succeed in business.

I know this because we track data relentlessly, and we always dig into the practices behind our clients’ numbers.

When we publish our monthly leaderboards, we always interview the gym owners who earned a spot, and we seldom hear about exotic tactics. If we do, we start testing the tactic to see if it will work everywhere—and if the answer is “yes,” we tell gym owners about it.

But those instances are rare.

What’s more common in our leaderboard interviews is virtuosity—mastery of the basics. We regularly hear things like this: “I just stuck to the plan” or “I did what my mentor said” or “I focused on this one thing that really moved the needle.”

That’s virtuosity in practice—doing the common uncommonly well.

Here’s what virtuosity looks like with regard to average revenue per member per month:

And here’s what our leaders had to say about their ARM scores (note that these are all basic but extremely effective tactics):

We did it by “cleaning up systems, getting rid of holds and punchcards. … PT first for everyone!”

“We didn’t do a great job initially in pushing people into a private model (on-ramp). Once we doubled down on that, we improved. Now we have a reputation for PT. Level Method added tons of value. The focus now is to try and implement our nutrition service the same way!”

“We don’t do classes. Only 1:1 and only small group. Forty clients: 30 do 1:1 and 10 do small group—$300-$500 a month.”

“We always find good fits. We have a very clear red-flag process for clients; i.e., if they miss two sessions. We refer them out if their budget is less than $200.”

“We have peak and off-peak rates for popular times. My rates are higher than my trainers’ rates ($30-$50 more, up to double).”

“We have a lot of clients with kids in our town, so many of our clients were asking ‘what can you do to get our kids moving more?’ The goal was to install good movement patterns in their kids. Our gym name gives us a great local reputation that we are the best at helping people stay safe in the gym!”

“We do what you guys tell us to do.”

“We do small-group PT and sports performance training. That typically has a higher ticket price than the average group stuff.”

“Before Two-Brain, I was underpriced and really not confident. … I am in a unique setting in the sense that I personal-train out of a commercial gym.”

“We took very specific actions thanks to Joleen (our mentor). We focused on reaching out to local doctors and PTs to pitch ourselves as the perfect place for their clients to ascend to once their treatments were done. Having these types of partnerships means we have a steady flow of clients, allowing us to then double down on our staff to service the demand.”

“I’d take homemade food to businesses and practitioners in our area to introduce ourselves. Everyone in our area knows who we are because of this!”

Master the Fundamentals

I love sharing quotes from our top gym owners every month because it demystifies gym ownership.

It turns out you don’t need to experiment and come up with wild ideas to make your gym extremely profitable. You just need to learn how to do the simple things really, really well.

The best way to master the basics fast: Get help from a master.

When you’re ready to do that, we’re here.

The post Top Gym Owners Reveal All: The Secrets of Huge ARM appeared first on Two-Brain Business.

Key Tactics From Gyms With Massive Average Revenue Per Member

Chris Cooper (00:02):
Most gyms don’t have a marketing problem. They have a retention problem, and they have a value problem. I’m Chris Cooper. This is “Run a Profitable Gym,” and today I’m so fired up to share our leaderboard of the gyms providing the most value. We measure value provided by ARM, average revenue per member—what people are paying in reciprocation for the value they receive at a gym. That’s what ARM is. If you want to earn more money per client, you provide more value, and then you charge appropriately. Obviously, a lot of gyms are providing more value than they charge, and this is something that we help them work out in our mentorship program and correct that problem, so they are charging what they’re worth. These gyms are the gyms that are worth the most to their clients worldwide. Let’s start from number 10. Now, average revenue per member per month is the average across all of their members divided into their revenue.

Chris Cooper (00:55):
So if you’re making a thousand bucks a month in revenue and you’ve got 10 members, then your ARM is a hundred. These gyms are doing a lot more than a hundred dollars per member per month. While the industry average is still low, it’s still around 145—maybe even slightly less in some places in the U.S.—these gyms are all over $400 per member per month. Now these are U.S. dollars, and these are all people who are providing great value to their clients. Their clients are happy to pay that much, and they’re keeping those clients around too. Let’s start at number 10. This gym is from the U.K. and their ARM, average revenue per member per month, from the last three months—this is a three-month average—is $427.06. Amazing. Imagine if every member at your gym was paying half of that—OK, 214 bucks per month: What kind of impact would that have on your business?

Chris Cooper (01:48):
Incredible. Number nine, coming in ninth, this is a U.S.-based gym, and their ARM is $432.12 per month. Congratulations. You are obviously providing a ton of value, and you’re worth the value that you receive in return. In eighth place: an ARM over the last three months of $440.45. This is also a U.S.-based gym. So, again, all these numbers are in U.S. dollars. They’re an average of the last three months. We don’t want to just like take an average from the last single month. So, you know, these are consistent, that this gym is operating well, and there are things that we can learn from these gyms. I’m going to share those in a moment. (Number seven was a U.S. gym with an ARM of 452.84). In sixth place—oh, this one’s great because I’ve been watching this gym for a long time, and I just realized who it is. Their ARM: $523.87.

Chris Cooper (02:38):
Congratulations. That is so amazing. This gym’s in Colorado, by the way. In fifth place: an ARM of $528.88. Imagine having an ARM of over $500 per client. Incredible. You’d have to deliver so much value so well to earn that. I’m so impressed this one. The next one in fourth place: $548.29. This one is really, really interesting because these guys work primarily with medical practitioners as a referral source. Next in third place, also from the U.S.: an ARM of $556.94 per month. Now, just remember that when we’ve had a gym on this leaderboard, and they’re not inside the U.S., we still calculate their ARM in U.S. dollars so that we’re comparing apples to apples. And of course, by reading the blog post, you can see this; you don’t have to stop your car and pull over.

Chris Cooper (03:32):
There are two gyms left on our leaderboard, second place and first place. The second-place gym for ARM this month—or December 2023—is from Canada. Awesome. And their U.S.-dollar ARM average was $673.94. Can you even imagine your clients paying that much? How did they get to an ARM of almost $700 per month? We’re going to tell you in a moment. The last gym—the top of our leaderboard worldwide, out of 1,000 Two-Brain gyms around the world—the top ARM last month was $797.99. This was a U.S.-based gym. This was in a locale where a lot of people say, “I can’t charge more. My local market won’t support it.” These guys just obliterate that feeling, that sense, that myth that you’re telling yourself that you can’t charge more. Their ARM is almost $800. They might be the first gym to crack that three-month $800 ARM average.

Chris Cooper (04:33):
And I can’t wait till they do; I can’t wait till somebody beats that. So, the top ARM last month in Two-Brain was $797.99. That’s what they get per client per month at one location. That’s their average over the last three months. So, they’ve been doing this for a while. They’re keeping their clients; their clients love it, and nobody is fighting them over the price because they produce so much value. Now, the part you’ve been waiting for is: How in the heck did they do that? Let me get to that. So, the reason that we compile these leaderboards is so that I can identify who is doing the best at something and then ask their advice and then share that with you. You have to start with measurement. You have to know who’s actually doing the best because if not, you know what happens.

Chris Cooper (05:17):
You’re in the microgym industry; you start getting people who really aren’t doing that well giving you advice. You got gyms who are doing $15,000 in revenue a month telling you how to get more clients. They don’t even know that’s their biggest problem. And you can’t even figure out what your biggest problem is until you look at your metrics, and you don’t even know if you’ve got a problem until you look at the best in the world and say, “How do I compare?” That’s why we prepare these leaderboards every month. But my favorite part of this process—even though I love the math—my favorite part is talking to these top 10 gyms and saying, “What are you doing? How are you delivering that much value? How is your ARM that high?” And then telling you their answers. So here they are: First, Michaela Munsterman is on the leaderboard, and she’s doing this amazing, amazing marketing with cinnamon rolls.

Chris Cooper (06:06):
I know, you heard me right. OK, so here’s what she does: She bakes cinnamon rolls, and she takes them to medical professionals in her town, and she introduces herself—“Have a cinnamon roll. Let’s talk about what I do.” And of course, nobody slams the door in her face. Nobody says, “You’re crazy. Get out of here. Stop soliciting me with these delicious cinnamon rolls.” I mean, if you’ve ever visited me at the Two-Brain workshop, you know, Tuesday is cinnamon roll day here, and the cafe is baking, and the whole place just smells like cinnamon rolls, and I really have to fight that—the temptation to have one. If you’re a medical professional and somebody shows up and you’ve got this nice, warm homemade cinnamon roll, you are going to sit and listen to what they have to say. And even if you decide, “I’m not going to refer people to you,” you’re still going to love them, right?

Chris Cooper (06:52):
Because you’ve got this cinnamon roll and probably a coffee to go with it. It’s not just cinnamon rolls. Michaela does this with a variety of food and coffee. And what she’s basically doing is just showing up with a coffee and some curiosity and saying, “Tell me about your practice. What do you do? How do you help people?” And then of course, they ask her the same question, and she says, “Here’s what I do.” You can hear our full interview with Michaela on the podcast. I’ll link to that below (Michaela’s episode airs on February 8th). Kelly Lorenz is not using paid ads to drive her ARM. She did a rate increase last year, which drove her ARM up $10 across the board. She added kids’ classes; she added more personal training and small group personal training. And she does amazing with her kids’ program.

Chris Cooper (07:37):
She said, “We created a group called Mini-Roadrunners where mothers and their kids, usually mothers and daughters, basically go out running with us. So, we do a loop around town, and of course that generates more business, as well as getting kids moving through the pandemic. We had a lot of contacts because we were the ones who were really talking about that. And we went all in on building up our kids’ programs. We became renowned as the local expert. A lot of our parents,” she said, “a lot of our members are parents who had kids, and with the right affinity marketing that Two-Brain encourages us to do, we go to our clients and say, ‘Who else in your family can benefit from this? Who else do you know that can benefit from moving their bodies regularly?’ And so, I had parents calling me or texting me or emailing me and asking me because right now, in our area, there’s a break for organized sports.”

Chris Cooper (08:30):
So, end quote. Kelly is really, really smart at identifying opportunities and aligning those with her passions. Obviously, she’s not running a kids’ program just because it makes a lot of money or boosts her ARM. She’s doing it because she loves kids and sees a real opportunity to help kids in her community. She started it during COVID. Then she said, “What if I could get moms and daughters running together?” and started their roadrunners club. And as those kids traveled around town, they started bringing their friends, and other people started seeing them. And that is the best type of marketing there is. It’s identifying a place where you can clearly help solve a problem, then solving that problem, and that’s what attracts new people. But that’s also what builds value. You don’t build value by telling people, “I’m going to correct your squat technique.” You build value by solving the problem that they want to solve.

Chris Cooper (09:18):
And so, their problem is probably not, “I want to move better.” Their problem is probably not, “I want to get better at CrossFit.” Their problem is, “I’m bored with my current workout, and I want to try something new.” Or their problem is, “My friend’s been coming here three nights a week, and I don’t see them anymore.” Or their problem is, “I don’t feel good about my body. I don’t want to take my shirt off at the beach.” If you are the one who can solve that problem, you will not have a problem establishing value with your clients, and they will not have a problem paying for that value either. Kelly added, “We decided to do a 10-week program for seventh and eighth graders and then for ninth graders, and we charged $408 for the 10 weeks, and then those kids come twice a week. And that just really helped boost our ARM.” End quote.

Chris Cooper (10:07):
There’s another great lesson here, and that is: We can do an amazing service for kids that a lot of us are overlooking. If you think about—if you have kids and you think about them in sports, and you think about what you pay to put them in sports, think about the reasons that you’re willing to pay that. You know, why am I willing to pay $600 a month for cheer lessons, gymnastics, music lessons? Why am I willing to pay $7,000 a year to put them on a traveling basketball team or to put them in the off-season baseball academy? Well, it’s because your kid loves it, and you want to encourage them, and if there is a small chance that this goes on to become their career, like you don’t want to be the barrier to that. And so, you’ll do anything to support your kids.

Chris Cooper (10:50):
But the reality is that only the tiny, tiny minority of kids are involved in sports. And so, the best thing that you can do is help parents help their kids find something they love. I remember a couple years ago, a Phys. Ed. teacher had this real epiphany, and he was telling me about it, and he said, “Coop, like, I don’t need to teach these kids how to play dodgeball. I don’t need to teach them how to play volleyball. They will never do those things after they graduate high school, but if I can help them find one thing they love enough to continue it on their own, I’ve changed their life.” And so now he teaches CrossFit and he has them doing weightlifting meets, and he teaches them powerlifting and running and rowing and all kinds of different things. And a lot of these kids go on to join gyms, or they go on to pursue their passion on their own.

Chris Cooper (11:34):
I can name probably a dozen of these kids who have bought a rig and stuck it in their garage after high school. That’s amazing. And that’s what I mean by value. What we’re really trying to do, if you want to boost up ARM, is hone in on your clients and find places where you can improve your value to them. For example, nutrition programs work the exact same way. If a client is working out really, really hard, but she’s not losing any weight, the best value you can provide her is a very clear nutrition program with accountability to do the work—even if that comes down to like writing up a sample meal plan or something. That is how you provide value. And of course, you should be open to receiving. Bob Burg, in his book “The Go-Giver,” talked about: There’s a yin and a yang to giving.

Chris Cooper (12:21):
If you want to be good at giving, you have to also be good at receiving. That means you have to open up yourself to the possibility that your gift is worth something and be willing to receive it, right? Nobody likes a bad receiver who will just say no to your gift, who won’t accept your gift, won’t accept your help. Nobody likes that person, and nobody, also, likes to feel indebted. And so, when you offer something of enormous value, people are usually willing to pay it. What stops most gym owners? It’s right here; it’s in between their heads. They look at their budget; they look at their empty wallet, and they say, “I’m broke. I couldn’t pay more for nutrition coaching so nobody can,” or “I already know all that stuff. Everybody knows that stuff. Nobody will pay for that.” And of course they will. The key to building great ARM is identifying the problem that your client is trying to solve, determining which of those problems you can’t solve because you can’t solve them all, offering to solve those problems for them, and then doing it—getting them the result, solving the problem.

Chris Cooper (13:21):
When you do that, not only will they pay more, they’ll be happy to do it. I’m Chris Cooper. This is “Run a Profitable Gym,” and this is our leaderboard show. If you were one of the top 10 gyms in the world for average revenue per member, congratulations, you’re an inspiration to the rest of us, and thank you for sharing your lessons with everybody else. If you want to talk more about these leaderboards, or what these stats mean or how to improve your ARM, the best bet is to go to gymownersunited.com. That’s our free group where I’m in there, my mentor team is in there. We’re answering questions. We’re sharing free information. We’re giving out guides. We’re giving you tactical advice every single day for free because it is our mission to help your gym succeed. Thank you for your service.

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$430 Average Revenue Per Member? Yes!

Average revenue per member (ARM) is a force multiplier: Every client you add brings more revenue.

And getting $10 more per existing client is usually way more effective than getting 10 more clients because new clients have costs.

About a year ago, only the top five gyms on our ARM leaderboard were over $400.

In July 2023, every single gym in the Top 10 was over $427, and the Top 10 average was $533.

In December 2023, every gym was once again over $427, and the Top 10 average increased to $537.

This is a big deal: Gym owners are consistently finding ways to offer incredible value to their clients.

Here’s the December 2023 leaderboard (we reveal the names of the gyms in our private group for clients):

The Stats in Perspective

I know these numbers can be mind blowing, so I’ll give you some perspective:

One of the owners on the leaderboard once had an ARM of $70. Now it’s well over $430.

Here’s the simple strategy she used to 6X her ARM: “We’ve since branched out and added value to each client’s membership using different strategies like personal training or small-group personal training or kids classes.”

So if your ARM is low right now, take heart. You can drive the number up, and you don’t need some secret, ultra-complicated tactic to do it.

Here’s one thing you can start doing today: Offer PT if you don’t offer it, and if you do, ask your group clients if they want to add one PT session per month to work on a specific skill one on one.

Another gym owner on the leaderboard offered a great mental exercise you can do when you’re reviewing your ARM:

“As you’re looking to maybe raise prices or go to that level, really write down your value of what you do and kind of reframe: ‘What if you don’t charge your value?’ Especially if you’ve worked really hard with your schooling, your education, your experience—and you’re not charging for that value. Are you really doing yourself a service?”

The answer is “no.” If you’re an amazing, experienced coach who helps clients improve their fitness and nutrition, you are punishing yourself and your family if you don’t charge what you’re worth.

In the worst-case scenario, you’re charging so little that you’re forced to close your gym—then your staff members, your clients and your community lose.

I’ll push you to try the exercise today: Write down everything you do for your clients. Be detailed—don’t leave out “small” things such as sending them a happy birthday text or celebrating their successes as if they were your own.

Write it all down, and then look at your average revenue per member. It’s likely you’re delivering more value than you’re charging for. In that case, you might need to increase rates (a mentor can help you do it).

If your number reflects the value you’re delivering but you’d still like to earn more, here’s the million-dollar question: “How can I deliver even more value to clients?” A mentor can help you with that one, too.

I’d like to see you on our leaderboard someday. I’ll give you a first step toward $430 ARM: Work toward an ARM of $205. That’s a great initial target. Do something to move toward it today!

And if you want a detailed plan to improve your ARM, let’s work together.

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Get a New Client in 60 Minutes: Two Tactics to Try

If you wanted to get a new client in the next hour, what would you do?

What are the exact steps you would take, and do you think you’d end up with a client?

Try this: Read on and then test your plan in the next 60 minutes to see if it works.

And if you don’t have a plan, I’ll give you a starting point.

In the digital era, it’s likely many gym owners would turn to the web to find a client fast.

And in some cases that’s not a bad idea.

If you have lots of leads on a contact list, you might be able to send out a newsletter or announcement and get a response. It’s not a sure thing, but it’s a smart play—though it hinges on the work you’ve done to build and warm your mailing list. (Have you added anyone to it this week? When was the last time you sent out a message?)

Still, a mass email is a gamble. You’ll have to write a message and then get it out. You can produce a short email campaign in an hour, but you can’t control the speed of response. If people don’t open it and reply fast, you’re out of time. This is a broad approach, not a targeted strike.

Advertising to cold leads is a very bad idea if you only have 60 minutes. Cold leads are fickle, flighty and hard to connect with. If your instincts tell you to fiddle with your Facebook ad spend in your 60-minute window, I’d recommend you resist the urge.

You could start messaging people on social media. It’s not a bad idea, but you’re still working with colder leads, and you’re wading into the overwhelming sea of social-media notifications. I’m not a popular guy, and even I can’t keep up with all the little red circles and flashing icons anymore.

Earlier this week, Chris Cooper and I chatted about tactical referral strategies such as taking coffee to neighboring businesses or planning lunch-and-learn seminars for the co-workers of a client. These are sure-fire ways to get clients, and Chris has used them to get hundreds of clients who paid hundreds of thousands of dollars over the years. But these strategies can’t be used in one hour. They’re part of the long game to dominate your local market.

What else can we consider? I’ll give you my personal Top 2 high-speed tactics from the Two-Brain ToolKit.

Tactic 1: The Closest Contact

1. If you know your clients well—you should—you will know of a client’s family member who could use your help. In any gym, you can find a great client who has mentioned a spouse or parent who needs help with fitness or nutrition.

Now would be the time to contact that client directly and make a play: “Sam, I was thinking about your dad today. You’ve mentioned him so many times. I think it’s time to solve this problem. What can we do to get him started today?”

This is a strong play because you’re connecting with a current client to devote your full attention to addressing a pain point fast. The client’s relative has definitely already heard of your gym, and you aren’t alone here: You have backup!

Will Sam’s dad agree to meet with you if Sam sends a message right now? It’s not a sure thing, but the odds are pretty good. And if you can get Sam’s dad to commit to a free consultation or even a workout with Sam, you have a very, very good chance to earn a new client, even if the meeting doesn’t happen in the next 60 minutes.

Tactic 2: Gone but Not Forgotten

Think about members who have left your gym for some reason—or those who went on “hold” and promised to return someday.

With 60 minutes on the clock, I’d try messaging departed clients.

Think about it: You have contact info and an existing relationship. There’s history, high-fives and hugs. You already know the former member’s goals and personality. You can connect with the person by phone or text right now and make a tailored pitch:

“Hey, Tim! I was thinking about you today. You said you were traveling for a while, and I wanted to reconnect. I haven’t forgotten about you and that amazing deadlift! What’s your schedule like these days?”

I wouldn’t try this approach with the dude who stomped out after you told him not to park in the space reserved for wheelchair access. I’d also pass on the super-competitive open-gym rat who jumped ship to try the new Ultra-WOD Comp-Blast 3000 program at the box down the street.

But I would try this approach with clients who left on good terms. In many cases, some of them just need a reminder or an invitation to start up again.

Get Moving!

You’ll note my two suggestions involve very close contacts: either current clients or former clients.

That’s not an accident. It’s part of Two-Brain’s sales hierarchy. Check it out:

So here we go.

You have 60 minutes to get a new client—or at least book a free consultation.

What are you going to do—and will you succeed?

3, 2, 1 … go!

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Tactical Referrals: Go Where Your Members Go

“Where do my best clients congregate when they’re not in my gym?”

Whatever your answer is, you should go there.

My first three clients were teen athletes, and my next 30 clients were their teammates or parents.

That’s because I used to show up at track meets carrying a tent and a banner. The Catalyst colors are black, silver and chartreuse because that shade of green is visible from a greater distance than any other color, so my tent stood out.

My clients would show up to stretch with me before their races or games. Their friends would see them, and I’d often say, “It’s OK to bring your friends with you!”

Did I ask permission? Never. But I was never told to go away, either. Parents would point me out to other parents. I used to come home from these events with two or three new clients to call the following day.

I’ve joined local Facebook groups, business groups and sports training groups. I’ve volunteered to coach teams. I’ve set up tables at various events to connect with attendees. I’ve done free seminars at businesses and clubs. I’ve made it my personal goal to shake 365 new hands in a year.

This approach works because you are the ultimate lead magnet.
 
Stop burying yourself behind a keyboard or a smartphone and go meet some people!

Here, I’ll give you three ways to “go where your clients are” and come away with more leads.

1. Events and Competitions

You run a gym, and your clients use their fitness outside your building. So what do they do?

Do they participate in fun runs? Fitness competitions? Spartan Races? Golf tournaments?

When you have your answer, offer a prep program six to 12 weeks out from the event. Promote it internally first, then externally. Ensure the price per session is higher than that for your normal classes. Choose one coach to run the program and pay 44 percent of the revenue collected. (Two-Brain clients get a full playbook for several types of events—including promotional materials and programming for events such as a Spartan Race.)

Next, contact the event organizers and let them know you plan to get them more registrations. Sometimes they’ll promote your program for you (this is rare but awesome when it happens).

In the best-case scenario:

Your clients sign up for your prep course, which increases your average revenue per member.Non-members who plan to do the event sign up for your prep course. Be sure you get to know them and tell them how you can help them reach their fitness goals after the course ends.You train a large crew of people who will represent a significant presence at the event.

When the event rolls around, show up in force. Bring banners, sidewalk chalk and noisemakers. Wear gym T-shirts or gym colors. Be supportive and be seen!

Hand out high-fives, get to know other participants and crank out social media during and after the event. People are going to notice you, and some will even approach you.

When you are asked a question, that’s your opportunity to help.

Example: “How did your crew recover so fast between events?”

“We did a seminar on competition nutrition and helped them get their food together ahead of time. Want me to send you a PDF with some info?”

Collect the email address and add it to your mailing list. You just acquired a new lead. After you send the PDF, check in with the person: “What did you think of the info?” Get the conversation going, and when the time is right, book a No Sweat Intro.

In some cases, you can even book No Sweat Intros right on the spot: “I’d be happy to talk to you about a personalized training plan. Let’s meet at my gym Tuesday at 10 a.m.!”

This is such a great tactic because you generate revenue right away, you connect with people in person, and you raise the profile of your business in the community, which has a downstream effect.

In my case: “I see that green Catalyst Gym banner everywhere.”

When that person is ready to join a gym, who will they call?

Tactic 2: Lunch and Learn

Think about where your clients work: How can you help a member’s co-workers? These people generally have the same incomes, schedules and problems as your member—which means they’re a perfect fit for your gym.

And they’ve probably heard of you because your member no doubt mentions your business from time to time.

When a client mentions a stressful period at work, jump in to help them.

“Hey, Steve—I know you’re weathering year end like a boss. You’re still training four times per week and eating well. Way to go!

“How can I help your coworkers? How about a short seminar on how to eat well during stressful times? I can come in for a half hour at lunch to give them some tips and an eating guide. Would that help?”

Then show up with five clear bullet points and a call to action.

Get the email addresses and phone numbers of all attendees so you can follow up.

Your call to action: “I really enjoy working out with Steve. You guys know how much fun he is. I told him I’d help all of you if I can. Here’s my offer: If you want to ask your questions in private, you can book a 15-minute coaching call with me. My card is on your desks. And tomorrow I’ll send you the link to my calendar through your email address.”

These people don’t know you well, so they might require a bit more nurturing before they book a consultation. However, Steve is your ace in the hole, and his recommendation will carry weight with his peers.

Tactic 3: Booths and Magnets

All communities have events—fairs, expos, festivals and so on.

Whenever you see an opportunity to set up a booth or table, do it!

All you have to do is create some hook to get people to stop and talk. You can do this by giving away some schwag—perhaps through a draw. People sign up for your newsletter and provide contact info in exchange for a chance to win a free PT session.

A different approach: Offer a free InBody scan in exchange for contact info. This costs you nothing if you have a portable scanning machine.

You can also create a “lead magnet”—say, “Top 5 Healthy Dinners for Busy Parents.” You’ll have to create that document, but keep it simple and then use it forever (Two-Brain clients have access to our Content Vault, complete with done-for you magnets). Once you have your lead magnet, give it away in exchange for contact info.

Your goal at an event is to start conversations, collect contact info and maybe even book some No Sweat Intros on the spot. After the event, nurture your leads—personally or with automations. You will get clients if you do that.

Go Where They Go!

When my gym needs five new clients, I don’t turn to Instagram. I go where my clients are.

Do this right now: Ask yourself where your very best clients spend their time when they aren’t at your gym. Then use one of the tactics above to connect with the people who are close to them.

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Tactical Referrals: How to Replicate Your Very Best Clients

Two things that can’t be said enough:

Referrals are one of the best ways to grow your business.

Referrals don’t just happen—you must generate them.

I’ll give you some great ways to do that below.

Tactic 1: Goal Review and Help First

You should meet with clients every 90 days to review their goals and adjust their programs, if needed. A few minutes before you meet with the client, make some notes. Who does this client live with? Work with? Hang around with? You should have three opportunities for referrals right away.

Write down actual names if you can. If you don’t know any names, use the session to learn about your client instead of asking for a referral. Solidify your relationship first before trying to expand it.

If you’ve written down names, decide which person would be the most likely to need your service. Then practice “help first”: How can your service help a potential referral get to their goals?

When you meet with the client, make an offer to help the connection. I wrote an entire book about this, with dozens of specific examples for gym owners. Here’s one:

“Mary, I know your husband Bill likes to golf. What does he do to stay in shape in the offseason?”

Then invite Bill in for a session with Mary. It’s not a free PT session; it’s just an explicit invitation to join Mary for her workout.

After the workout, do a No Sweat Intro with Bill. Your close rate in these meetings should be very high because the person has already received a glowing endorsement from a very close contact.

Tactic 2: Go for the Group

As you build relationships with clients, you’ll be able to identify opportunities to invite someone’s friends, family or coworkers in for an event.

Bring a Friend Friday, Wine + WOD, a corporate challenge, a ninja warrior challenge for kids, a birthday party or even an invitation to watch the client perform a workout—all of these can result in amazing referrals.

Try these approaches:

“Mary, we’re hosting a women-only workout on Friday. I’m going to bring some wine. Who would you like to invite from your friends list?”

“Mary, I know your daughter’s baseball team is nearing the end of the season. What if we brought them in for a team party on Saturday? I’ll set up a little ninja warrior challenge, you can bring a snack, and we’ll just let them have fun for an hour. How about it?” (This is a great way to fill a kids program and acquire parents as clients, too.)

“Mary, I know this time of year is stressful at work. What if we invited your team in on Friday night for a fun workout challenge to blow off steam? I’ll bring snacks!”

Of course, getting people in the gym isn’t the same as signing them up. But it’s a great way to start the conversation. While you’re chatting with your new leads, your goal is to get them to book intro appointments.

The key to accessing this pool of warm leads? Look for ways to meet the people who surround your clients.

Tactic 3: Referral Cards and Invitations

The Planet Fitness Black Card membership comes with lots of perks, including the right to bring a friend to every workout. Planet Fitness doesn’t get to know its clients, so this is a passive play.

In coaching gyms, the bring-a-friend plan is active. I’ll give you two approaches.

Two-Brain mentor Brian Bott has well-designed, black VIP cards he uses to generate referrals—but he doesn’t just hand them out.

Instead, he talks to new members and specifically asks if any close contacts would like to train with them. If the answer is “yes,” Brian assigns the thick, glossy credit card to the specific person. It gives them the right to train with their friend twice a week for 30 days.

The key is that the card carries weight—literally and figuratively. It feels special, and it represents huge value assigned to a very specific person. The client giving it knows how valuable it is, so the client receiving it is much more likely to use the card.

Brian goes over his process at 48:59 in this podcast.

Another Two-Brain mentor, Brian Strump, handed out referral cards at one time but found the general approach didn’t get results for him. Now he has his coaches ask their best PT clients if they have friends who might also enjoy personal training. Or he has his coaches get to know clients and then ask if specific people in their lives would enjoy PT, too.

These contacts are invited to join the client for a free PT session—at no charge to either person.

If they book the session together, they’re going to show up, and the new person is always more comfortable with the friend training, too.

“Sometimes, the new person will purchase one-on-one training sessions, but we’ve also sold two-on-one sessions because the friends enjoyed the free session together and wanted more. … While PT rates vary, I believe most people understand that personal training is a premium service. This pre-qualifies the prospective new client,” Brian said. 

You’ll note these approaches are very specific.

It’s not “here’s a flimsy referral card along with your receipt. Maybe hand it out to someone if you don’t lose it.”

It’s “this card gives your very best friend Phil a valuable chance to train with you for free to see if he thinks strength training might help him prepare for that 5-km run you said he wants to do.”

Take Action!

All of these tactics will work—if you use them.

If you just sit back and assume your great coaching will inspire your clients to bring their friends, you might get a few new people every year. Maybe. But probably not.

If you get to know your clients and work to connect with their closest contacts, you’ll fill your gym with great people without spending huge amounts of money on ads.

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