Huge revenue in gyms isn’t tied to advertising.
At least that’s what top gym owners often tell me.
I know—it sounds weird at first.
My own revenue record came in a month where we flooded Facebook with ads for a six-week challenge.
But when I talk to the world’s best gym owners, I rarely hear about giant advertising campaigns and crazy promotions.
I recently spoke with Eric Conner and Steve Ramsbottom. Both earned spots in the upper ranks of Two-Brain’s most recent monthly revenue ranking, which runs from US$50,000 to $93,000 per month.
Eric’s down in Southern California, not far from L.A. CrossFit Reform grosses over $50,000 a month, and Eric has increased revenue by 100 percent since 2016. In 2022-23, he added 20 percent to gross revenue.
Eric doesn’t run ads.
Steve’s gym, Performance Institute, is in B.C., Canada. Steve’s been in business for more than two decades. He’s worked with Paralympic medalists, pro sports teams and A-list celebs including Hugh Jackman, Jessica Alba, Zac Efron and Amanda Peet.
Steve didn’t mention crazy ad campaigns either.
So what are these gym owners doing?
The short summary:
They’re focusing on retaining high-value clients with A+ service, then getting referrals from those clients.
That’s the plan—and it works.
Operations Before Ads
I’m not down on advertising, and I’m not saying it doesn’t work.
Two-Brain teaches clients exactly how to use paid ads to grow a gym, and some of our clients use them to produce amazing results.
But I’m no longer surprised when gym owners with incredible metrics tell me they don’t prioritize advertising over client experience and referral campaigns.
Think about it:
- Happy, high-value clients who get the results they want stay a long time and push a ton of revenue into a gym over a period of years.
- When they’re asked to, these happy clients bring friends, family members and co-workers to the gym.
- These new people are closely linked to long-term members who already love the gym, so they’re likely to stay for a long time, too.
- The new people often give the gym access to a fresh pool of referrals, and the cycle continues.
Here’s the other end of the spectrum (I’ve lived through this):
- A gym owner tries to generate more revenue with an ad campaign.
- The ad campaign works, and people start pouring in.
- The gym owner is overwhelmed, service suffers, and existing members become irritated.
- The gym owner struggles to onboard and connect with the clients who signed up for the six-week challenge or transformation.
- Established clients start to leave because service has declined.
- Newer clients leave, too, because they’re moving on to another challenge or transformation.
- Revenue at the gym stays the same or drops.
I’ll give you the simplest revenue-generation plan I can offer. It’s based on mountains of data Two-Brain tracks, as well as conversations with elite gym owners who are dominating our revenue category. Here it is:
Dial in your operations so high-value clients get the results they want, then ask them to refer their friends.
Then, if you want to, feel free to run an ad campaign to find a few more perfect clients.
But if I were you, I wouldn’t prioritize advertising over asking every single happy client if they know anyone who needs your help, too.