Fostering Member Loyalty explores the dynamics involved in creating and sustaining a business environment that captures the emotions of its customers and ultimately engenders customer loyalty and advocacy.

1. Fostering Member
Apostles and Advocates
“Win hearts and you have hands and purses”
Lord Burleigh - 1500’s

2. Customer Loyalty Breeds Storytellers and Spenders!
Percentage of loyal customers who exhibit storytelling behaviors
Spread the Word Buy more Don't consider
other products
Join social media
site
78%
69%
54%
15%

3. Delighted and Loyal Members Stay Longer and Refer More Often!
Remain a Member
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Dissatisfied Satisfied Delighted
Leave At Risk Stay
2x more
likely to
remain than
a satisfied
members
9x more
likely to
refer than a
satisfied
member
Member Referral
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Dissatisfied Satisfied Delighted
Never Might Will

4. The Member Experience Relationship
Loyalty, Advocacy, and Spend
Dissatisfaction
and Outrage
Satisfaction Delight
Member Experience
Source: Customer Delight Principle
Tim Keiningham
Problem
Resolution
Emotional
Engagement

5. The Pyramid to Profitability
A Hierarchy of Emotional Engagement and Profitability
Emotional engagement and Trust
Tenure, incremental spend and referral
Delighted
Loyalty & Love
High Trust
Advocates & Apostles
Won’t Leave
Satisfied
Satisfied with experience
Not emotionally engaged
Trust contingent
Vulnerable to External Choices
Dissatisfied
Expectations not met
Distrust engendered
Angered
Potential Detractors & Terrorists

6. The Member Value Equation
The operating framework for member loyalty and advocacy
Member’s
Perception of
Value
Product
Quality
Commodities of the Club
Drivers of Satisfaction
Facility
Quality
Service
Quality
Emotional
Quality
Price Time
Advocacy/Loyalty
Differentiator

7. A Comparison of Two Club Value Propositions
Luxury Club Loyalty Proposition Budget/Economy Club Loyalty Proposition
SQ PQ
EQ
High Fees, High Dues
FQ
Price
Low Fees, Low Dues
FQ

8. The Member Value Equation
How one club’s members expressed it!
Emotional Quality (EQ)
Service Quality (SQ)
Facility Quality (FQ)
Product Quality (PQ)
Price and Time (PT)
• Members are proud to belong to the club
• Members have established enduring friendships
• The Club helps Members achieve fitness goals
• Tenured staff provides comfort and security
• Staff demonstrate sincere caring and attentiveness
• The club communicates transparently and
frequently
• The facilities are very clean and well maintained
• The club offers a variety of high-tech equipment
• The wet areas with sauna, steam and whirlpool are
unique in the market
• The club has a great spa offering
• The club has cutting-edge mind body classes
• The club regularly introduces new programs and
services targeted toward our interests
• The bonus program provides great opportunity to
get discounts on in-club services
•The 30 minute classes make it easier to get in and
out

9. The Experience Creates Loyalty and Advocacy
The Real Picture of the Member Experience
Member Experience Member Beliefs & Feelings Future Behaviors
Member Pride
in Belonging
Appearance and Condition of
the Physical
Environment
Staff Knowledge, Attentiveness
and Empathy
Social Environment and
Opportunities for Building
Relationships and Connecting
with Community
Love My Club
Member Delight
Will Remain a Member
Will Recommend
Brand Engagement
Connections & Relationships
Brand Advocates
Apostles, Advocates & Fans

10. Measures of Loyalty and Advocacy
Member Delight…How well are you doing with FQ, PQ and SQ?
25%*
7% 4% 4%
11%
51%
9% 8%
51% 51%
30% 35% 37%
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
September 2009 April 2010 October 2010
Not satisfied
Could be better
Acceptable
Satisfied
Fully satisfied
12% 21%
*Clubology Metric = Top – Bottom 3 as %

11. Measures of Loyalty and Advocacy
Highly Likely to Remain…Emotionally Engaged and Don’t Want to Be Without You!
19% 19%
27%*
2% 1% 1%
11% 9%
8%
33% 37% 36%
*Clubology Metric = Top – Bottom 3 as %
54%
53% 55%
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
September 2009 April 2010 October 2010
Definitely Will Not
Probably Will Not
Might or Might Not
Probably Will
Definitely Will

12. Uncover Key Loyalty Drivers
Example of the Underlying Influences on the Big Four
Importance of Driver to Members
0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90
Pride in belonging
Relationships with other members
Attentiveness and recognition from club staff
Club's image in the community
Relationships with fitness staff
Variety and quality of group X programs
Ability to get assistance with fitness program
Ease of bringing friends as guests
Convenience of using facilities
Availablity of fitness equipment
Ability to meet other members with similar interests
Variety of fitness equipment
Cleanliness of the club facilities
Availability of amenities in the locker rooms
Cost of additional services (e.g., food, lessons, etc.)

13. Prioritizing & Leveraging the Drivers
Know How Member Priorities and Club Performance Align!
Reallocate Resources Protect
Image of the brand
Attentive staff
Clean floor areas
Temperature of facility
Locker rooms are adequately
supplied
Background music
Professional trainers
Professional sales
managers
Clean locker rooms
Reference by name
Clean showers
No sig. changes
Improved
Declined
Comfortable environment
Physical layout of the spaces
Conducive environment for new
relationships
Cost as compared to competition
Cost of kid's membership
Cost for personal training
Cost of membership
Cost-Quality Ratio
Design and decoration
Drinking water availability
Drinking water quality
Environment in general
Feeling of exclusivity
Inform about the club's services
Knowledgeable staff
Latest press
Medical Personell
Opportunities to include family,
friends
Opportunities to meet
people from the same social
circles
Personal assistance if desired
Pride in belonging
Professional reception
Promptness of receiving
Quality of locker information
room necessities
Reputation of my club
Responsiveness to
requests/questions
Safes for the valuable things
Satisfaction with Gym
Sauna overall
Security for valuables
Towels quality
TV broadcast/channels
Varied pricing and
membership categories
70
50
30
10
-10
-30
-50
-70
Focus on Improvement
0.25 0.3 0.35 0.4 0.45 0.5 0.55 0.6 0.65
Member Satisfaction
Importance of the attribute

14. The Impact of Member Tenure on Loyalty
How Member Tenure in One Company Held a Few Surprises
35 %
33 %
32 %
27 %
13 %
52 %
50 % 51 %
45 %
39 %
21 %
23 %
25 %
30 %
35 %
60 %
50 %
40 %
30 %
20 %
10 %
0 %
Less than 6
months
Half a year One year Two years More than 2
years
Overall Evaluation
Likely to recommend
Likely to renew membership

15. Getting to Member Loyalty and Advocacy
A Business Progression to Enhance Loyalty and Advocacy
Find Out What Your Members Say About the Value Proposition!
• Discover what the members have to say and measure it
• Uncover the drivers of the value proposition (FQ, PQ, SQ, EQ, Price and Time)
• Clarify the major drivers of each component of the value equation
Focus On Identifying the Strategic Priorities of Your Value Proposition !
• Create a matrix and determine what drivers need your focus
• Develop a master strategy around the priorities (what resources need to be applied
where)
Craft Your Brand Promise and the Brand Story!
• Create a compelling brand message (purpose, tone, and story)
• Build your story and script, and use that to model the experience(s) you deliver
• Create standards for the brand’s delivery and share them with everyone
Foster Your Internal Culture to Execute on the Brand Promise!
• Clarify and codify the underlying cultural imperatives needed to deliver the promise.
• Measure performance against the standards (specific metrics )
• Share the results, and reward achievement of your metrics

16. Member Loyalty and Advocacy
What business experts have said about customer loyalty and its consequences
“Win hearts and you have hands and purses”
Lord Burleigh
“Do what you do so well that they want to see it again and bring
their friends.”
Walt Disney
“You don’t earn loyalty in a day. You earn loyalty day-by-day.”
Jeffrey Gitomer
“Talk to people in their own language. If you do it well, they’ll
say, ‘ God, he said exactly what I was thinking’. And then they
will follow you to death”.
Lee J. Iacocca
“Repeat business or behavior can’t be bribed. Loyalty has to be
earned.”
Janet Robinson

17. Insight…We begin by seeking to understand, followed by analyzing the data, resulting in a story only the
numbers can tell.
Inspiration…with the numbers in hand, we generate those “magic facts” that tell you the real story about
your business and its impact on your bottom line.
Impact…with inspiration driven by insight, we assist you with developing and executing strategies that drive
greater loyalty and profitability.
Stephen Tharrett, Co-founder and Principal | stevet@club-intel.com | 972.746.7605
• 20 years leading athletic, golf and tennis as VP and SVP of Operations at ClubCorp
• 2+ years as CEO of the Russian Fitness Group
• 10+ years as a consultant in the fitness and private club industry
• Author of 8 business books on the club industry
• Former president of IHRSA
Mark Williamson, Co-founder and Principal | markw@club-intel.com | 214.232.2389
• 17 years heading up employee and member insights as VP of Research at ClubCorp International
• 5 years as Senior Director of the Guest Experience at Brinker International (e.g., Chili’s, Maggiano’s, On the Border, Romano’s
Macaroni Grill, Corner Bakery)
• 2+ years as Executive Director of Consumer Insights at Applebee’s
• 2 years as Director of Research at Match.com