In many industries, there are “sacred cows” that businesses worship. These are ideas so entrenched that people don't even think to challenge them. But these ideas aren't infallible, and many of them lead to bad business practices.
A sacred cow is a rule, standard or formula that operators blindly follow because that's the way things have always been. At one time, those rules, standards and formulas may have made sense, but unwittingly, they became sacred over time, even though the world, the consumer, the business and the industry changed. And, unfortunately, a lot of businesses in our industry don't recognize that the world has changed.
Let's take a look at some of the sacred cows in the fitness industry. The first one deals with clubs copying the industry leader. This isn't usually the best choice because the strategies that made the industry leader No. 1 play to their strengths, not yours. Instead, leverage what makes you different. The industry leader in your market already owns their position. You can stay or become competitive by owning a different position in the market and clearly defining and articulating your points of differentiation.
Another cow is only selling 12-month memberships. Both competitive market conditions and, more importantly, our potential members have forced the industry to sell memberships the way that they want to buy instead of how we want to sell them. Most clubs, at the very least, now offer more flexible options, such as three-month minimums or month-to-month memberships.
The mindset that low-priced clubs will never last is another belief that many businesses have wrongly worshipped. Several national companies have proven that this sacred cow is dead. The low-priced model is here to stay. Their success shows that they fill a need that customers have.
Another sacred cow is that membership freezes should only be for medical reasons. You need to be more flexible and offer one to two freezes per year for reasons other than medical. Otherwise, prospects may not join or members may cancel rather than freeze their memberships.
Thinking that branding is too expensive and only for the big companies is a sacred cow, too. The assumption is that when people say, “Let's brand something,” they automatically think of 30-second commercials during the Super Bowl. But to me, branding is an intellectual exercise. I don't think intellectual exercises are expensive. Depending on how you execute it, your branding program can certainly be expensive. A brand is what defines you as being different, as being better than the competition, and it gives potential customers a reason to choose you.
The idea that low-use members will continue to pay for months is another belief we hold on to. Members today who are using the club are cancelling at a much faster rate than they did in the past. Therefore, every club needs to develop a better integration and retention system.
The last sacred cow is that new competition is the reason for your sluggish sales and higher cancellations. The competition isn't the reason or the only reason for your business challenges. The bigger questions are how do you look at your business, how does the customer look at your business and what is important to them? Do you look at the club through the eyes of the member? Have you addressed all the controllable issues of customer service, differentiation, cleanliness and helping get your members results?
For clubs that want to eliminate sacred cows but are struggling to do so, list the sacred cows that you believe you are following. If you can identify a few of them that are somehow limiting your ability to be successful, you can reassess your situation and make the necessary adjustments.
Ed Tock, president of Eddie Tock Health Club Sales and Marketing Consulting, specializes in on-site seminars and performance/profitability programs. He can be reached at 845-736-0307 or [email protected].