Using Technology To Improve Membership Sales & Retention

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Using Technology To Improve Membership Sales & Retention

  1. 1. IHRSA 2011 San Francisco, CA Using Technology to ImproveMembership Sales & Retention Trends & Solutions 1
  2. 2. Bryan O’Rourke - Who ? 2
  3. 3. Bryan O’Rourke Who ? 3
  4. 4. Bryan O’Rourke - Who ? Who Dat !
  5. 5. 5
  6. 6. give and I’ll give you 1 hour of free consulting https://american.redcross.orgconnect with me @ www.bryankorourke.com 4 6
  7. 7. YOUTHANK 7
  8. 8. Using Technology to ImproveMembership Sales & RetentionTrends & Solutions 8
  9. 9. BROAD 9
  10. 10. 3(main topics) 10
  11. 11. Hang With ME 11
  12. 12. 1. TRENDS:consumer & technology 12
  13. 13. 2. FACILITIES:big business challenges - kpi 13
  14. 14. 3. SOLUTIONS: emerging & future 14
  15. 15. At The End Of Each Segment 2 Questions Blogs On Topics To Follow Format:Collaborative Consumption15
  16. 16. 116
  17. 17. 1 1. Technology &Consumer & Technology Trends Consumer Trends www.bryankorourke.com
  18. 18. “The Purpose Of Business Is To CreateAnd Keep A Customer” Peter Drucker
  19. 19. Tony Hsieh pronounced“shay” Its All About Customer ExperienceAuthor & CEOFriday March 18 - 8:30 - 9:30Happiness A Path To Profits, Passion & Purpose
  20. 20. "We are massively underestimating this culture shift... We are in the era of the humanization of business. Wereliving by small town rules again." Business Is Changing
  21. 21. CONTEXTCUSTOMERtrendwatching.com is one of theworld’s leading consumer trendsfirm, relying on a global networkof hundreds of spotters. Ourtrends, examples and insights aredelivered to 160,000 businessprofessionals in more than 180countries 21
  22. 22. INTERESTING 2011 CONSUMER TRENDS WWW.TRENDWATCHING.COMWhen it comes to the mega trendof GENERATION G (thats G forGenerosity, not Greed), there’s nobetter way for a brand to put itsmoney where its mouth (or heart)is than engaging in Random Actsof Kindness (R.A.K.). Consumerscravings for realness, for thehuman touch, ensure thateverything from brands randomlypicking up the tab to sending asurprise gift will be one of themost effective ways to connectwith (potential) customers in2011. 22
  23. 23. INTERESTING 2011 CONSUMER TRENDS WWW.TRENDWATCHING.COMUrbanization remains one of theabsolute mega trends for thecoming decade. Heres just onetelling stat: “Today, half theworld’s population – 3 billionpeople – lives in urban areas.Close to 180,000 people moveinto cities daily, adding roughly60 million new urban dwellerseach year.” (Source: Intuit,October 2010) 100 cities comprise30% of the global economy. urbanconsumers tend to be more daring,more liberal, more tolerant, moreexperienced, more prone to tryingout new products and services. 23
  24. 24. INTERESTING 2011 CONSUMER TRENDSMore consumers are constantly WWW.TRENDWATCHING.COMconnected, and when they hearabout new deals online canquickly and easily spread themthrough their social networks.Increasingly, consumers will bepart of exclusive networks orgroups to either receive specialdeals or demand them.Mobile devices increasinglyenable consumers to find orreceive dynamic deals right at thepoint of sale, or to compare pricesonline. Case in point:Amazon.com just released aniPhone app that allows users tocompare prices by scanning theproducts barcode, photographingit or saying its name. 24
  25. 25. INTERESTING 2011Online culture still is the culture, and CONSUMER TRENDS WWW.TRENDWATCHING.COMthus well see a rise in online statussymbols in the next 12 months (afterall, status symbols reflect thezeitgeist like nothing else). Whatstarted with showing off the numberof visitors to ones Flickr pages orblog now also encompasses thenumber of ones Facebook friends(or any other social network),Twitter followers, Foursquare check-ins and a host of other metrics thatindicate ones wiredness. In thenext 12 months, you can’t go wrongsupplying your (online-loving)customers with any kind of symbol,virtual or real world that helps themdisplay to peers their onlinecontributions, interestingness,creations or popularity. 25
  26. 26. INTERESTING 2011 CONSUMER TRENDS WWW.TRENDWATCHING.COM73% of US consumers consider beingphysically fit important to being‘well’(Source: The Hartman Group,August 2010)500 million people worldwide areexpected to be using mobilehealthcare applications by 2015.(Source: Reasearch2Guidance,November 2010)There were nearly 17,000 health appsavailable in major app stores inNovember 2010, with 57% of thembeing aimed at consumers rather thanhealth care professionals. (Source:Reasearch2Guidance, November2010) 26
  27. 27. INTERESTING 2011 CONSUMER TRENDS WWW.TRENDWATCHING.COMExpect a rise in ECO-SUPERIORproducts: products that are notonly eco-friendly, but superior topolluting incumbents in everypossible way. Think acombination of eco-friendly yetsuperior functionality, superiordesign, and/or superior savings. 27
  28. 28. INTERESTING 2011*According to Jeff Jonas at IBM, CONSUMER TRENDSmobile devices in the US are WWW.TRENDWATCHING.COMcreating approximately 600 billiongeo-spatially tagged transactionsa day (thats every call and text,not just web connectedsmartphones!)For consumers, knowing wherethey are and whats / whos aroundthem is the key to PLANNEDSPONTANEITY. Thats about toget a whole lot easier, as geo-location becomes a key feature ofsocial networks and web apps(from existing providers addinglocation information, such asFacebooks Places, Twitterslocator, and Googles Hotpot, todedicated services likeFoursquare, Gowalla andBrightkite) 28
  29. 29. INTERESTING CONSUMER TRENDS WWW.TRENDWATCHING.COMTraditional ownership implies acertain level of responsibility,cost and commitment. Consumerslooking for convenience andcollecting as many experiences aspossible want none of thesethings.Fractional ownership and leasinglifestyle businesses offer thepossibility of perpetual upgradesto the latest and greatest, theability to maximize the numberand variety of experiences, andallow consumers to accessotherwise out-of-reach luxuries.Owning bulky, irregularly useditems is both expensive andunsustainable, 29
  30. 30. http://europeanwebreport.ning.com 30
  31. 31. engagement
  32. 32. INTERESTING CONSUMER TRENDS http://europeanwebreport.ning.comhttp://europeanwebreport.ning.com 32 engagement
  33. 33. INTERESTING CONSUMER TRENDS www.byrankorourke.com rachel botsmannew business models 33
  34. 34. INTERESTING CONSUMER TRENDS34
  35. 35. “The World Has Changed. Power HasShifted To The Customer. They Don’tTr u s t A d v e r t i s i n g . T h e y Wa n tAuthenticity. They Want Engagement.T h e y Wa n t Va l u e . T h e y Wa n tConnection.” Bryan O’Rourke
  36. 36. IF YOU don’t do itSomeone ELSE WILL
  37. 37. Do YOU Believe This ?“The Purpose Of Business Is To CreateAnd Keep A Customer” Peter Drucker
  38. 38. what is DRIVING consumer change ?5 ImportantTechnology TrendsFor 2011 for more visit www.bryankorourke.com 38
  39. 39. “If GM had kept up with technology likethe computer industry has, we would allbe driving $25 cars that got 1000 MPG” Bill Gates
  40. 40. 1 INTERESTING 2011 TECHNOLOGY TRENDS WWW.BRYANKOROURKE.COMCLOUD more computing power software as a serviceCOMPUTING greater functionality better ROI less costly 40
  41. 41. INTERESTING 2011 TECHNOLOGY TRENDS WWW.BRYANKOROURKE.COM41
  42. 42. INTERESTING 2011 2 TECHNOLOGY TRENDS WWW.BRYANKOROURKE.COMwhenever whereverlocation basedfunctionalsocialMOBILITY 42
  43. 43. 3 INTERESTING 2011 TECHNOLOGY TRENDS WWW.BRYANKOROURKE.COMSOCIALIZATION 1) Era of Social Relationships 2) Era of Social Functionality 3) Era of Social ColonizationOF THE WEB 4) Era of Social Context 5) Era of Social Commerce 43
  44. 44. 4 INTERESTING 2011 TECHNOLOGY TRENDS WWW.BRYANKOROURKE.COMAPPSnew functionalityhighly specializedinexpensivefun 44
  45. 45. 5 4 INTERESTING 2011 TECHNOLOGY TRENDS WWW.BRYANKOROURKE.COMdigitization of all experiencevirtual shadow of physical CONTENTsmaller more frequentgrowing the pie CONSUMPTION 45
  46. 46. “Organizations Must Accept A NewParadigm; One Based On CollaborationWith Their Employees And Customers.You Must Either Embrace This NewApproach Or Become Irrelevant. ” Bryan O’Rourke
  47. 47. 47
  48. 48. Consumer & Organizations 48 The New Paradigm
  49. 49. 249
  50. 50. 2What Are The Biggest Opportunities For 2. Club ChallengesHealth Clubs Today ? www.bryankorourke.com
  51. 51. The New Orleans Connection 2 51
  52. 52. 2 Author Michael Lewis52
  53. 53. 53
  54. 54. A Few Other Books By Michael Lewis 54
  55. 55. CONTEXT:THE RIGHTNUMBERSBilly Beane, general managerof MLBs Oakland As andprotagonist of MichaelLewiss Moneyball, had aproblem: how to win in theMajor Leagues with abudget thats smaller thanthat of nearly every otherteam. 55
  56. 56. 56
  57. 57. Think Differently
  58. 58. What Do YOU Think Is The#1 Challenge For HealthClubs Today ? THE KPI
  59. 59. THE KPI Attrition & Engagement •  Attrition: Nearly 10.5 million people joined a health club in the U.S. in 2009, while 10.7 million dropped their memberships, producing a  “churn” or attrition rate of 24%. •  Core members:  “Core” users remain members of their club for approximately 21.5 months longer than casual users. Assuming average monthly dues of $41.47, converting one member to a “core” user would therefore generate nearly $900 in extra revenues.59
  60. 60. the Sell SELLSELL culture 60 THE KPI
  61. 61. HOW MANY OF US THINK ABOUTATTRITION-RETENTION IS WRONG 1. The attrition percentage is heavily influenced by the number of membership sales. Between June and July the attrition % fell (from 5.0% to 4.9%), yet the number of cancellations increased (from 126 to 129)! It is clear in this example that the reduction in attrition was caused by a large amount of new joiners in June and not by any improvement in the retention of existing members. 2. The attrition percentage does not take into account HOW LONG A MEMBER HAS BEEN RETAINED. It is possible to see huge variances in the membership duration of each member that cancels. THE KPI 61
  62. 62. HOW MOST OF US THINK ABOUTATTRITION-RETENTION IS WRONG In order to understand how to improve retention operators need to measure: 1. THE RETENTION RATE defined as: The proportion of members who stay for a predefined period of time e.g. 3, 6, 12 months etc. 2. LIFETIME VALUE defined as: The average length of time members stay and therefore how much they pay in membership fees. THE KPI 62
  63. 63. all members are NOT the same Segmentation - changes how we manage market and engage members 63
  64. 64. THE KPIThe Health Club BusinessKnow your customers and analyzethe right numbers.1. Retain Members By Making Them Happy2. Intelligently Manage Costs 64
  65. 65. winning the unfair gamewww.polledemaagt.com 65
  66. 66. winning the unfair game Manage expectationswww.polledemaagt.com 66
  67. 67. What Billy Beane, knew about baseball we know aboutthe health club business. 67 THE KPI
  68. 68. Dr. Paul Bedford Working with the UK YMCA in 2006- 2007 and as part of his PhD. research, Dr. Paul Bedford applied his behavioural change strategies at the Central YMCA . With resulting increases in average membership length from 7 months to 13 months, and reduction in cancellations from an average of 77 per 1,000 members per month to 23 per 1,000 per month.  4:00 pm Wednesday March 16, 2011 Talk’s Cheap - Applying The Psychology Of Persuasion And Influence In Sales 68
  69. 69. WHAT A SURPRISEEngaging members impacts attrition ! 69
  70. 70. Bryan: We Hear You ButH ow D o We M e a s u reCorrectly, Know OurCustomers Better AndEngage ? THE KPI
  71. 71. 371
  72. 72. 3How Can Technology Impact Retention & 3. Current SolutionsMember Sales Today ? www.bryankorourke.com
  73. 73. Strategy & Tactics Ask Yourself These Questions
  74. 74. “What Are Or Is Your Club’sTechnology Platform(s) ?” remember the “cloud”, intelligently managing costs and consumer trends?
  75. 75. “What Are Or Is Your Club’sTechnology Platform(s) ?”can you.....segment member types and behaviors ?engage via email, text and social networks ?engage by member types and behaviors ?deliver customized web content to users ?provide on line bookings and memberships ? you need to ...
  76. 76. Upgrade Your Website - Online Membership Make it social enable on line registration customize user content
  77. 77. Create A Mobile Application Make it social customize user content location services
  78. 78. Mobile And RFID Technologies Emerging better data modeling micro transactions - membership tracking enables unbundling of memberships
  79. 79. Rick Stollymeyer 2:00 pm Wednesday March 16, 2011 The Future Is Technology Get Your Club Connected
  80. 80. “Do You Understand WhyMembers Are Coming AndGoing ?” remember consumer trends and retention challenge?
  81. 81. “Why Are Different MembersComing and Going?”are you.....tracking RELEVANT data around joins and cancels ?looking at the “life cycle” of your membership ?creating a predictor model ?engaging members around the model ? you need to ...
  82. 82. Aspirations Mapping Where Member Segmentation, Programming & Engagement Align
  83. 83. Customizing Member EngagementBridging The Physical & Digital -Outside & Inside The 4 Walls
  84. 84. allisterrollins@theretentionpeople.com Tom.Fuyala@11AntsAnalytics.com
  85. 85. “How & Where Are YouInvesting Your Marketing?” remember engagement and intelligently managing costs ?
  86. 86. “How And Where Are YouInvesting Your Marketing?”are you.....shifting funds away from traditional media ?trying to make digital engagement work ?tracking ROI of campaigns ?sharing targeted and relevant engaging content ? you need to ...
  87. 87. Mobile Targeted Promotion -THE SINGLE BIGGEST TREND
  88. 88. Mike Bannan 4:00 pm Wednesday March 16, 2011 Growing Membership With Yelp, Google Places & IDEA Fitness Connect Steve Groves 11 am Wednesday March 16, 2011Release Your Inner Geek: Social Media For Fitness Professionals
  89. 89. Upcoming - Engagement ViaSocial CRM & Gamification 89
  90. 90. “Is Your Equipment &Programming Engaging ?” remember consumer trends & intelligently managing costs ?
  91. 91. equipment - treadmill “coach” 91 automated delivery
  92. 92. group programming 92 automated delivery
  93. 93. 5 You can forget most of the crazy things I said & showed you today. just please try and remember these 5
  94. 94. 1 “The purpose of business is to create and keep a customer” Peter Drucker
  95. 95. 2 Consumer trends are changing and technology has a lot to do with it
  96. 96. 3 5 technology trends for 2011: cloud, mobile, social web, apps, content
  97. 97. 4 Key kpis for health clubs are member lifespan, engagement & cost management.
  98. 98. 5 Strategic use of technologies to service and engage members will be essential to success. requiring you to....
  99. 99. THINK differently
  100. 100. think differently thank youwww.bryankorourke.com 100
  101. 101. <3> THANK You www.bryankorourke.com connect with me @ 4 101

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