In this article, we cover powerful strategies and tactics you can use to increase your fitness studio revenues. Consulting firms use these strategies, and top business schools teach these tactics to increase sales and grow revenues. These strategies have been modified to apply to the fitness studio industry. When implemented, these strategies can help you improve your fitness studio revenue significantly in a short period.
There are four key strategies for increasing your fitness studio revenue:
- Get more customers taking more classes
- Increase the amount each customer spends
- Increase prices
- Add products or services to account for seasonal dips in sales
In this article, I will go into detail in each strategy and give you specific tactics you can implement in your boutique fitness studio. The tactics vary from selling class packs to implementing pricing that is right for your fitness studio business. When you do increase your fitness studio revenues by implementing these tactics, do write to me and share your results.
Increasing Your Fitness Studio Revenues
Whether you run a boutique fitness studio, a yoga studio, a dance studio, or any other group class studio, you can implement these strategies and tactics. These strategies have been designed to increase sales significantly in a short period.
First, it is essential to understand that sales is not the same as profits. We will cover strategies to increase profits in a different article. In this article, the focus is to outline tactics to increase sales, also called revenues or “takings”.
Sales = Number of customers X spend per customer
Profit = Sales – Cost
As you can see from the equations above, you can increase sales by increasing the number of customers (volume) or by increasing the amount spent by each customer. The amount spent by each customer depends on your pricing and also on the type of classes you offer. Let’s take a closer look at the four strategies with specific tactics you can implement today in your boutique fitness studio.
Increase Volume To Your Fitness Studio
Volume to your fitness studio, yoga studio, dance studio or any other group fitness class can be increased by increasing two things:
- Number of new customers
- Recurring usage from existing customers
Increasing The Number Of New Customers
When studio owners think about increasing sales, the primary way they imagine doing so is by attracting new customers. When you are a new fitness or yoga studio owner, attracting new customers to your studio is going to be the primary way in which you increase sales.
Attracting new customers to your studio is a function of sales and marketing. You are in a good position because boutique studios are trendy among millennials. To attract your core demographic (millennials) you can use these specific tactics:
Build an Online Presence
Even if you are a one-person fitness studio, you will need an online presence. It could be a simple one-page website or just your class schedule posted online where people can access it and book your classes online. Ensure all your online pages work well on mobile.
Create social media accounts for your fitness or yoga studio. At the very least, create a facebook page and an Instagram account for your studio.
Make sure you have your studio listed on Google My Business. Upload photos from your studio onto your profile and invite your initial customers to leave you reviews.
Once you have an online presence for your studio, you can begin advertising to your prospective customers. For your local studio, Facebook, Instagram, and Google ads will work very well. Also, you can share some of your discount codes on coupon sites. For a local fitness studio, advertising via flyers in a targeted location can also give excellent results.
The key to local advertising is to provide a hook. You could give a discount or a free class at your fitness studio to attract people who have never heard of your fitness studio class.
Create a Referral Engine
Referrals from existing customers are very powerful to attract new members. Think about your favorite transactional app, whether it is a ride-sharing app or a food delivery service, you are incentivized to invite your friends to join the service. In a similar way, you can incentivize your boutique fitness studio members to encourage their friends and family to try your classes.
The best way to encourage referrals is to use a referral engine in your online class booking experience. Here is a simple example I found of a referral engine embedded in the online booking experience.
Partnerships and Email Lists
If you are a boutique fitness studio, try to identify other services that your customers will be interested in. The goal of forming partnerships is to find businesses and people with whom you can build a relationship to mutually help your customers.
A good example of a mutually beneficial partnership could be that between a fitness studio catering to women who are 25+ and a new mommy coach. I have seen such partnerships become very fruitful for both the parties involved. In this example, the new mommy coach could hold weekly sessions at the fitness studio to engage the fitness studio’s new and expectant mothers. Similarly, the new mommy coach could refer their existing clientele to the fitness studio.
A similar concept to forming partnerships is to “borrow” email lists. If you have an email list, you are in a position to send a message about a complementary business to your customers. Similarly, the partnering business will send a message about your fitness studio to its customers. I have executed this tactic well by partnering with a fitness app and having them send an email about my wellness studio to their customers while I sent an email campaign to my customers informing them about the fitness app. Such a campaign is highly effective in bringing on new customers to your fitness studio.
Increasing Recurring Usage from Existing Customers
Once your boutique fitness studio has a steady flow of new customers, you should also begin to focus on getting your customers back into your classes regularly. Monthly recurring memberships used to be the primary membership type in the past. However, with the rise of the boutique studio industry, people typically attend more than one studio.
In today’s world, class packs are very popular and are a great way to get your new customers to commit to your fitness studio. Class packs are typically sold in batches, for example, a pack of 3 classes or a pack of 5 classes. The more classes a customer buys, the bigger the discount they get. Make sure you are offering class packs with well-designed rebates and incentives to turn your new users to regular members.
Increasing The Amount Each Customer Spends (Upselling)
Upselling is the concept of selling your higher value services or additional products or services bundled with the service the customer is currently purchasing.
A great way to increase your overall sales is by upselling. Imagine what could your customers need for their fitness or yoga class. Perhaps a bottle of water or maybe a protein shake after the class? You can add such upsell opportunities right at checkout.
When you sell class packs online, it is essential to integrate your upsell opportunities into the checkout process. Perhaps you can include a single click “buy” option for the upsell such as a bottle of water or smoothie.
For your most loyal customers, you can perhaps incentivize them to move on to a recurring monthly membership rather than buying class packs.
Increasing Prices Of Fitness Studio Classes
Pricing your fitness class or your yoga class is a topic in itself. However, one of the quickest ways to improve your revenue is to raise prices for your fitness studio classes.
Most of the fitness studio owners I meet are often hesitant to raise their prices. In general, fitness studio classes are priced higher than similar classes at big-box chains such as gym chains. At your boutique fitness studio, you are offering a more intimate experience and a smaller class size, which justifies higher prices.
However, before you go about increasing your class prices, you will need to take into account the following:
You will need to find the prices for similar classes in your local area. Ideally, your classes should cost similar to those of other local boutique fitness studios. You can price your classes higher if you are attracting a more affluent group of people or have a unique proposition unmatched by local competition.
Cost Base Pricing
Another way to identify your fitness class prices is to do a full rundown of all your costs. You will take into account all your costs, such as your studio lease, electricity, instructor fees, cleaning, etc. Once you have all your expenses in place, you should identify the total number of students you expect to have per class.
Once you are in a position to divide your costs per class across each student, you will get to your breakeven number. Now add a profit margin to your cost per student, and you will have your price per class per student.
Let’s take a look at this simple example:
Cost per class = $1000
Number of students per class = 25
Cost per student = $40 ($1000/25)
Desired profit per student = $20
Selling price of a single class = $60 (cost per student + desired profit per student)
A pricing strategy I use often is value-based pricing. In value-based pricing, you price your fitness classes based on the perceived value of the classes. Imagine your fitness studio or yoga studio serves an affluent neighborhood. You also happen to be the only boutique fitness or yoga studio in that neighborhood.
In such a situation, you can price your classes based on what the customer is willing to pay. For example, consider that your cost per customer is $10. You are still in a position to price your classes at $100 per class if the customers are willing to pay that amount based on the perceived value of your classes. Value-based pricing is a simple concept but when implemented can significantly increase the revenue of your fitness studio.
Which pricing method you use and whether you increase your prices is primarily dependent on your goal. If you are a new fitness studio and are focused on attracting new customers, then matching your prices to your local competitors is a good strategy. This is a good way to increase your fitness studio revenue.
If your focus is on profits, then increasing your prices is the right strategy. For my business, I have found that increasing prices has always served me well, and I focus on value-based pricing.
Create Seasonal Balance At Your Fitness Studio
If you are running a boutique fitness studio, most of your customers will purchase class packs rather than monthly recurring memberships. As a result, you will see a slump in sales during certain times of the year.
Creating seasonal events is a great way to get your customers to commit. An excellent example I have seen is Barry’s Bootcamp Hell Week. You can run such regular events during your seasonal dips. Having a well thought out annual event calendar will increase your sales significantly.
In conclusion, there are very few simple and clear strategies and tactics you can use to increase fitness studio revenue. I have used all the above strategies and tactics to boost the sales of my wellness business. A clear and straightforward way to implement the tactics discussed is to use the right class management software for your studio. Take a look at StudioGrowth. It could be what you have been missing.
I write about topics related to establishing and Growing your boutique Fitness/Wellness stuido. I promise no spam, i hate spam.
About the author
Naz Ahm is the founder of StudioGrowth and has spent a decade growing start-ups and venture-backed companies. He writes about sales, marketing, and growth, especially in the fitness and wellness industry.
Naz has an MBA from IESE Business School and started his journey in the wellness industry when he set-up an on-demand wellness business in London.