High Average Revenue Per Member in a Low-Priced Market

Miles Davis and title text.

Andrew (00:02):

When everyone does the same thing, fitness becomes a commodity and prices fall. That’s why Miles Davis is shaking things up and leading the charge to high-value services in the Atlanta market. Miles is on Two-Brain Radio with Chris Cooper, right after this.

Chris (00:16):

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Chris (00:57):

Hey everybody, I’m here today with Miles Davis. You know him probably from frequent posts in this group, Miles owns CrossFit South Cobb down in Atlanta. He’s one of the leaders, there’s this amazing kind of subgroup of Two-Brain, which is like the Two-Brain Atlantic group. And I’m going to let Miles tell you about what they’re doing in a moment. But first, Miles what brought you into the fitness industry?

Miles (01:24):

Oh man. Good question that, you know, always was active growing up high school, played sports, but I was always a little guy. So I played kind of little guy sports, played baseball, really enjoyed that. And moved into college, I loved being active. I love that team sport concept. So did some intramural stuff and then also started to wander into a gym. Our gym in college at the time was state-of-the-art a huge kind of globo setup and this is late nineties. So no functional fitness yet at that time. But getting into the bro stuff, bench press bicep, curls, all that stuff and wanted to continue that momentum as I got out of college and into the workforce.

Miles (02:05):

And so one of my first gyms I joined, I actually hired a personal trainer and worked with him for probably six months or so. Notice that the routines kept getting the same. There was a lot of redundancy there and I felt like I stalled out with results. So this was now what, 2008. And that’s when I found CrossFit. I was actually out in Las Vegas on a guy’s bachelor party trip. A buddy had a Muscle Fitness magazine. I grabbed it, started thumbing through it. And there happened to be this article in Men’s Health and Fitness about this upcoming trend called CrossFit. It just really grabbed my attention when I went back to Atlanta from the trip, you know, that article just stuck with my head and sure enough, there was a CrossFit gym that opened about six months before, about five minutes away from where I lived at the time, I was working from home for a startup company and wandered in there about a year after a pretty major reconstructive knee surgery and fell in love.

Miles (03:02):

And that was spring of 2008. So here I am. And yeah, so, spring of 08 and then started our box in fall of 09. So had a little over a year’s worth of coaching experience before I decided to take the plunge. I always blame it on my wife, she’s the one who talked me into doing it. I was kind of a play it safe type guy and she said, go for it. Let’s do it. And so we did, and CrossFit South Cobb’s has been open since November, 2009.

Chris (03:36):

And what did CrossFit in Atlanta look like in 2009?

Miles (03:40):

Yes. So there was really one major big CrossFit brand at the time that really kind of set the tone for everybody else. Atlanta was very much at the time in CrossFit, a copycat market, whatever you saw the big guy doing whatever he was priced at, that’s what you were going to price at, whatever they were doing for programming, that’s what you would do for programming. And, you know, they were the straw that stirs the drink. They had a lot of HQ trainers on staff. They’re very well connected with CrossFit HQ. The guy who owned the gym at the time, he was actually called the godfather of CrossFit in the state of Georgia. So he did a lot. And so, yeah, it was just very much a copycat market and we all followed what the big guy did. And, I was no exception because my first box also spawned from that box. So even though I didn’t directly spawn from that box, there was a lot of influence. As far as culturally, how you view CrossFit in the market, what it could be, what it shouldn’t be. And then slowly after that I got partnered up with another box nearby.

Miles (04:47):

He’s actually the oldest one in my County and he was a Rogue guy. He was an Army special forces guy, and he did not want to have anything to do with the way this main box did it. So he pushed me and he said, Hey, man, I think you should branch off the way you’re doing programming. You need to separate yourself because all of these other little copycat boxes out here in Atlanta are doing this, and this is a chance for you to really differentiate yourself. So that’s what we did.

Chris (05:10):

You know, that story you just told really reminded me of being in France two years ago. And there is kind of a godfather of CrossFit in France, Daniel Chauffey. He owns two boxes there, one down in Bordeaux, which is where we visited. And when we were talking to them about rates, they said, well, Daniel charges 170 a month. So we have to charge less than that. It was almost like this godfathery figure was setting the ceiling, not the foundation. Is that kind of what was happening in Atlanta at the same time?

Miles (05:42):

Absolutely. We never, you know, it was just such a novel concept, right? I mean, even, you know, and our rate was $150. That was kind of the Atlanta popular rate. I know you’d mentioned you talked to somebody who quoted rates less than that, but that’s usually what I saw at least in the beginning and yeah, nobody ever challenged that it was kind of a status quo. No one knew why we were charging one 50. We just knew that everybody else around us was. And so, you know, we wanted to, we thought differentiation meant, you know, we’re just a little further away from the next box, but we’re gonna program the same.

Miles (06:18):

We’re gonna have the same music. We’re gonna have the same setup, same equipment, you know, all of these little copycat boxes again and yeah, for a number of years, for at least for me the first couple of years, that’s all we knew is like that rate. And we never challenged that at the time when we started.

Chris (06:34):

And you said you were all using the same programming too?

Miles (06:38):

Yeah. So, and 2009, it was still very much HQ dominated programming where our market was, there are maybe some boxes who were rogue and did three days behind HQ. But that was about as variety as you saw in those early days, you know, Oh yeah, we follow HQ, but we’re one week behind, three days behind. And so, you know, just that’s what you saw. And then I’d say probably 2011, when things started to change, people started to tinker with that formula in terms of programming. That was the biggest thing that you saw before you saw really moves and pricing at the time.

Chris (07:15):

And you are really taking me back here. This is so great, Miles. So skip ahead a few years, and I’m talking to an affiliate owner in Atlanta, this was 2018 and he was one of the originals. So one of the first handful, and he said, it’s impossible to sell CrossFit for more than $79 a month now. So what happened in that span that would make him say something like that, do you think?

Miles (07:41):

Yeah. So if you start with like 2012, you know, that’s really when I saw the explosion of affiliates in our area. You went from one affiliate, maybe every five, six miles to now, all of a sudden, you know, the turf Wars really started to escalate, boxes showing up at the same corner. One instance was a coach left, a box, took 50 members and literally went across the street. And at that time that the box that lost was 50 members, they were a huge brand with three different locations in our city. You know, you started to see just so many affiliates out, popping, popping, popping, and I think people got scared and they said, OK, well, there’s too many boxes around. And that was the other thing you heard. There’s too many boxes in Atlanta for anyone to make money.

Miles (08:24):

So people thought, of course, let me just start to lower my price to stay in business, to stay alive. And what we saw was the exact opposite happened, the boxes that were, you know, dumpster diving and going super low hitting Groupon, you know, in those years, 2011, 2012, Groupon was big. You see one box, they ran a Groupon. And I want to say they had a thousand purchases, you know, a thousand people. Now they had three locations, but a thousand purchases on Groupon, it was like half off of what they call dynamic scores or 29 bucks. So something crazy. And, you know, that was the thought of that’s how you grow a business. Just go so cheap that you get this volume. So I’d say from 2012 to 2016, you just saw the volume game. How many boxes be out there and support 200 members, 250 members.

Miles (09:14):

So we fell into that trap too, played the volume game. We offered some crazy discounts for chiropractic students. And, you know, we were definitely peaking numbers wise around 2016. So I think to answer your question, as we got to 2016, 2017, things started to change because now you have like Orangetheory getting into the market. And now, you know, the masses are kind of moving away from CrossFit and a lot of gym owners didn’t know what to do. So again, continued to lower pricing and see if they can keep the head count up to survive.

Chris (09:43):

I’m really intrigued by your earlier comment that you kind of went, you followed this rogue dude who was, you know, not following the same programming and all that stuff too. How was he different from everybody else in the area?

Miles (09:57):

Yeah. And, you know, it’s funny. So he’s a Army Ranger and he wanted to have, basically, you know, a military mindset in his box. So instead of the classic programming of 10, 12 minute, AMRAPs with maybe some accessory movements, he would actually make t-shirts that said, you know, seven minute AMRAP’s never going to prepare you for war, seven minute AMRAP’s not going to prepare you for battle. So he took on that role of the black sheep and, you know, just outrageous long workouts, 45 minute AMRAPs. He’d have every year kind of this tactical assault course that he would set up in his parking lot with, you know, ladders and, you know, crawling under tunnels and everything like that. So even though I’m not a military guy, I saw the other extreme basically now I was seeing two extremes and I could find this middle ground for myself and say, OK, well, I’m not going to go crazy. Like he is with programming, but I can put together some sensible program with some good strength, emphasis and good smart metcons and I could find a niche for myself. And that’s kind of what I did.

Chris (10:59):

Oh, that’s so great. Well, let’s hear about that niche.

Miles (11:03):

So it’s funny. I called it chicken nuggets, man. So I tell my staff, I can remember probably as early, as like 2012, I said, Hey, look, you know, we’re not going to be the sexy gym and, you know, go out and find the fire-breathing athletes cause you don’t have the time. The games are huge and regionals were huge. And whose gym had regional athletes? That wasn’t my personality, that wasn’t who I naturally attracted. I naturally attracted kinda the chicken nuggets. So not as sexy steak or lobster and not a can of spam, but a chicken nugget, you know? And I told people, I said, that’s what we do at this gym. We make chicken nuggets. So I’m just going to churn them out. You know, your 36 year old dad used to be active 15 years ago, just needs to come in and move.

Miles (11:44):

He wants to get stronger. He can compete a little bit, but he’s never going to be at regionals. He doesn’t really care about the open that much. And then he’s going to bring his wife and she’s going to show up and she’s going to bring her mom friends, and we’re going to fill up our gym. We’re going to have 150 of those people. And that’s how we know who to program for. That’s what we’re going to shoot after. So even before getting into any kind of mentoring, I just realized that at an early time, like this is my market. So if someone came in and they had four gym bags and a bunch of gym tape and weightlifting tape and six different weightlifting shoes like that just wasn’t my box. And so I had the confidence to know that I could move them off and then also have the confidence to know that I could start to increase my pricing because I knew my target market, the chicken nugget, those guys are going to pay it. And that’s what I wanted my gym to be about.

Chris (12:33):

First, you say that you love to play small man sports and now your target market is the chicken nuggets,

Miles (12:40):

Chicken nuggets.

Chris (12:42):

How has that worked for you over time. Because I think a lot of people just really maybe came to that epiphany in 2020.

Miles (12:48):

Yeah. So if you say, I’d say probably like 20, I don’t know, maybe 2014, 2015. I did get into my first mentoring company. And when I got with them, it was still very much volume-based kind of business practices. So even though I knew my chicken nuggets, I would still have a little discount here for my students and I’d have a lot of influx of these chiropractic students. So they would be a little bit of a niche from my main niche and that survived a little bit, so about, you know, 2017. And then those people started to slowly fade away. There was another box that opened up a little closer to the campus. So I started to lose them and I’m like, Oh shoot, I’ve lost my, kind of my mojo with my main market. You know, I kind of ignored them.

Miles (13:35):

So in 2018, getting in with Two-Brain, you know, working with the mentor team, I was able to kind of realign with what I needed to do or the people I needed to serve. And so then we started the emphasis on, OK, let’s get back to our core, but now we’re offering personal training. We’re starting to stratify our services, diversify. And then it’s like duh, this is what I needed to do. This is what I missed for the last five years. And so I was fortunate to kind of survive that. But to your point, I was still ahead of a lot of other gyms. Cause you said 2020 people are just now starting to catch on. We saw a drip probably in 2017 and we knew we had to do something in 2018. Whereas other few other gyms kind of hung on to that old mentality before they’re starting to change. So very fortunate to find you guys and find your team to help us kind of get realigned back with our purpose.

Chris (14:26):

We’re fortunate to have you Miles, that’s the understatement of the century. And we’re going to talk about how you lead a lot of gyms in Atlanta. But what do you think is so hard about making that change to focus on your key avatar?

Miles (14:41):

Yeah. So I think, culturally, if you get caught up in the numbers and you start chasing numbers over quality, that’s what happens. So, you know, if you met a box owner five years ago, that’s the only thing you knew to ask about your gym. Hey, how many members you guys have over there? No one really would ask what’s your ARM or what kind of programs are running or, you know, what kind of square footage are you looking at? You know, what’s your cost per square foot, all those things. So, yeah, you know, you just had to kind of look at it and say, all right, if I’m going to do what I’m taught of driving up you know, high value services.

Miles (15:29):

It only really took a few months to realize like, Oh, I don’t need all these same people that I thought I did. And I can actually just focus and grow and get my team to buy in. And then once you do that, you kind of catch that wildfire. So that’s what I’ve seen in Atlanta. And the Two-Brain group that you’ve mentioned, people that buy into that, the high quality, low volume, the low volume type of model, then you know, those people, you see them doing really well, but the ones that are just chasing those five more members to 10 more members or whatever, those ones are still struggling, they’re frustrated because they haven’t bought in. So it didn’t take me long to buy in because I was doing it one way and it, you know, I kind of, I crapped out in 2017, so I knew there had to be another way.

Chris (16:13):

Yeah. That’s great. So let’s talk about that Atlanta group. What led to the creation of the Atlanta Two-Brain group? How do you guys operate? Like what goes on in there?

Miles (16:25):

I met a few of the guys at the Two-Brain summit, I guess that was what, 2019, and guy named Brandon Brigman who’s, I met him and he said, Hey, look, you know, there’s a few of us here in this room from Atlanta. We’re talking about putting together a group. And I was like, ah, cool. That sounds good, whatever, but it’s one of those things where you’re in the moment, you didn’t think that people are actually going to follow up with it. And so, they did, they sent me an email within a day or two from getting back from Chicago. And what helped me personally, being selfish is my gym happened to be in the geographical center of everybody else in our area. And he said, Hey, look, we’d love to do it at your place once a month.

Miles (17:08):

So we basically meet, it’s either the first or second Monday of each month, we meet for two hours. We usually have agendas based on whatever people want to discuss that, that particular meeting, whether it’s, you know, retail ideas, how do I pay a CSM? How do I find the CSM? How do I increase personal training revenue? What should I do about my space? Do you guys think I need more space? Do you think I could rearrange my space? So incredible, incredible value and to that point. I want to brag on a guy named Jonathan Beckner in my group who, I had about 10,000 square feet when I started with Two-Brain. I said, Hey man, I think I got to get leaner. Would you mind coming over and helping me? And he actually helped me draw up new floor plan for about 5,000 square feet.

Miles (17:52):

So I was able to save a ton of money in fixed costs, and you know, and used COVID to my advantage to do that. And I have the Atlanta Two-Brain group to thank for that because he came and just drove 45 minutes one way to spend about an hour and a half with me, we got on the whiteboard, we draw out different scenarios and we’re crushing it with that new floor plan. So just a ton of value. That’s what keeps me coming back every single week, every single month.

Chris (18:15):

Well, we all owe you a debt of gratitude Miles because, and not everybody in Two-Brain knows this, but you know, Atlanta was one of the first markets to reopen after the COVID lockdown and there were some really weird concerns that went on there, right? And so many times my first stop in the morning would be the Atlanta Two-Brain Facebook group. I would see what you guys had done. And we took so many templates from you guys. You know, I’m thinking about like Rick and Brandon, you mentioned Jonathan, Andy, Jeremy. A lot of the times you guys were first into the fire. And so, you know, on behalf of all the other thousands of gyms that took those templates around the world, thank you for that.

Miles (18:56):

Yeah, no problem. Yeah. We were very fortunate.

Chris (18:59):

The other thing that we’re taking from that Atlanta meetup is the concept of regionals. And you’re a regional host in February on Two-Brain day, February 13th. What can people expect from that Miles?

Miles (19:13):

Yeah. You know, just a relaxed environment, you know, people coming in, you know, it’s been so long since a lot of us have seen each other in person. So, when I say relaxed, you know, you actually get to come in and see someone face to face. Another word I’ll use is safe. You know, it’s gotta be a safe environment. So we’ll have a lot of spacing for everyone who wants to come in and attend. I think on the roster last I looked, we have somewhere between 15 and 18 folks and in our warehouse, that’s not going to be an issue spacing people out. I think people are desperate and craving for that interaction. You know, zoom is fun. It’s great. But there’s something about seeing someone face to face and asking the little things, having those little bits of conversations that we will all kind of missed out on. We’ve been so just proper with our communication, that it’s just nice to just kind of shoot it up with some people. So that’s what people and our regional location are going to look forward to.

Chris (20:04):

That’s great, man. So there are 30 plan worldwide. If you’re watching this, if you’re in the growth group and you’re not signed up for one yet, you can do that in some locations, depending on, you know, the status of reopening or whatever you might be online, but that’s OK.

Chris (20:19):

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Chris (20:43):

So Miles, we’re really here to talk about client value and ARM, but when you and I started talking about it a couple of weeks ago, it really hit me that by setting this higher standard in Atlanta, you’re kind of the tide that’s raising all boats. So let’s talk about what your ARM is, how your revenue model is broken down to get you there. And then we’ll talk about how that affects other gyms.

Miles (21:15):

Yeah. Our ARM right now is about $195. You know, to your point, my goal has always been able to keep it at around 200 or a little bit higher than that. A plug to Jeremy in our Atlanta Two-Brain group, at one time last year, his ARM was over 300, and he was bragging about that and I’m like, dang man, that’s awesome. You know, and so there’s always more right. There’s always ways to advance, bu, how do we do it? How do we get there? You know, even when we did the group on ramp, that kind of served as our little bump financially when a new member would come in, but now we have set up to do personal training only with our prep course. Folks are coming in for a minimum of five one hour sessions before they even can think about joining group.

Miles (22:04):

And what we see a lot of times is people are easily segueing that to say, you know what? I really love the extra accountability, the extra motivation, the customized programming that I’m getting when I joined the gym, I’d like to stay in a personal training longer. And so what we’ve done is we’ve changed our staff. You know, I tell people that, we’re kind of like an NFL team. You know, if I’m a good coach of a football team, I’m not going to take my playbook and force somebody into it, but I’m actually going to look at the personnel that I have and then design plays around that. So to that point, when I’m hiring coaches, they understand that they’re going to be part of that prep course group. And they’re going to be doing a lot of personal training. So I’m selling it to them as kind of like a coaching flywheel.

Miles (22:47):

Yes, they can make money from group, but there’s also significant money to be made from personal training prep courses, specialty. So they’re in that mindset when they first start working at the gym. And so it could be personal training, but then another one could be a specialty group. So we shut our kids program down due to COVID last spring. But when we reopened it, we changed our age group a little bit and found a better coach that was a better fit for there. And now it’s exploded. And so he’s bursting at the seam with the kid one, we’re actually going to start a high school one because I know he can run that well. Whereas if I didn’t have this coach, I don’t know if I would have pushed that envelope. I would’ve maybe gone somewhere else. Maybe another coach was more Olympic lifting focused and I would have formed a program around them. So bottom line to your point, trying to create these extra opportunities for our staff has done nothing but raise our ARM. So one-on-one training specialty classes like the kids, four to six weeks specialty programs, of course, and then a high priced high quality group classes.

Chris (23:48):

And we’re going to come back to that high price high quality comment too. When you’re helping these coaches, you’re talking about turning their own personal flywheel, how are you mentoring them to achieve their financial goals?

Miles (24:02):

Yeah. I’ll give credit to my mentor, Josh Martin, about that, you know, he’s always on me, obviously the godfather of Two-Brain coaching. So he’s big into pushing me to be a better leader within the organization. I love to be the face of the organization. I love to coach. I love to manage our brand, but sometimes I can have this kind of laissez Faire attitude with my staff and say, OK, well I’m not hearing anything bad, so I guess everything’s good. But, it starts with, you know, basically regular scheduled meetings. Some, some coaches I meet with once a week, um, other coaches, it’s more like once a month, but try to figure out what drives them. Why are they coaching for me in the first place? Maybe it’s only a six month window where life works out for them and they want to coach for me.

Miles (24:47):

And then they move on. But if I know that that’s OK, but if I don’t know that and I feel, I assume Sally’s just going to be with me for the next five years. And then she quits in six months. That’s my fault because I never knew what her goals were. So, regular scheduled meetings, usually on a monthly basis, no later than a quarterly basis to figure out, OK, does this feel like work to them? They actually love coming in> Are they happy? If they’re not happy, what do we need to do to change that? Is it more money? Sometimes being happy is less money. Actually. I had a coach scale back. She decided she wanted to be a member instead. And she started paying me and, you know, I use her sparingly whereas before ,last year, she was a 20 hour week coach.

Miles (25:26):

So being able to understand where people are in their motivation process, it changes, right. You know, everyone’s perfect day can change. I think I remember in your template, you said it may be changing as often as every 60 to 90 days and that’s OK. And knowing that, you know, that used to scare me before, like, Oh man, what if my coach goes after 90 days, but we’ve created this template after 12 years of being able to onboard coaches. So your point, I know I’m kind of long-winded, but regular scheduled meetings, one to two months at a time, and then also having a solid template to bring on new coaches,

Chris (26:04):

You specifically called out high value groups. And we spent the first 10 minutes of this interview talking about the effect of everybody doing the exact same thing, pushing the price and the value down in Atlanta. What is a high value group and how do you sell your service for more than other people?

Miles (26:23):

Yeah. To me, it starts with, you know, obviously if we’re doing the no sweat, which we’re doing in this room, they can’t come in and see a class because what if they come in at one in the afternoon? So I can’t just come in and say, Hey, look at our community. Isn’t it awesome. Right. Come join this. We got higher energy classes. So it’s really a matter of figure out what do they want? Right. So, my biggest sale to anything I’m trying to sell is accountability, I’m going to keep you accountable, whether we’re doing one-on-one or in a group class, we have a specific staff member called a client success manager, whose job it is to see you succeed. So we’re going to do everything on our end to fight, kick, scratch, scrape to see you succeed. So, we’ll talk about that then we’ll talk about the numbers.

Miles (27:09):

So COVID helps us here, right? We’re capping classes at 10. So you’re going to have an intimate experience with your coach. We’re not going to have barbell bootcamp where we’ve got 25 people shoved in here and trying to follow a WOD. We’ll touch on programming for those that ask about it. You know, our goal is longevity. We’ll have probably five members, at least that have been at our gym for 10 years. This year being 2021. So we’ll talk a lot about our program with longevity. We don’t really have to talk about other boxes around. We say, Hey, this is who we are. We just lead with value. We don’t lead with why we’re better than the other guy down the street. We just say, Hey, look, if you’re one of my athletes, here’s what I would do for you. Here’s what class membership would look like for you. If you’re not in in two weeks, you’re actually going to hear from somebody, right. You’re actually going to be able to safely move in and out of our classes without running into anyone from a COVID perspective, you’re actually going to have a coach that knows your name, your strengths, your goals, and all these things. And so leading with that has made us very successful.

Chris (28:10):

Do you ever get the, why do you charge more than this dude down there that’s charging half as much?

Miles (28:15):

You know, honestly, I have not. I think, and I’ll say there’s a guy we used to call him CrossFit Groupon. I don’t know if he’s groupon, I don’t even know his rates. Like I don’t even look at them anymore. I don’t know what anyone charges. I just know what we charge. So honestly, like I think we sell a lot of people because of the no sweat intro process. Just the process of actually sitting down, looking across the table from someone, looking them in the eye and say, how can I help? You know, what’s really bringing you in, you know, are you trying to blow off steam? You can do that anywhere. Right. You know, I almost try to unsell them. Like, you want to play video games, go home, take pills, whatever you can, you can zone out and, you know, blow off stress.

Miles (28:56):

But if you’re looking for a community that’s gonna bring a lot of positive energy and encouragement, then let’s talk more. Right. So I think that’s the biggest feedback I’ve gotten. Chris is like, wow, you guys actually take the time to sit down and talk about what I need. That’s more important than just, you know, can I save $17 somewhere else? Because usually that those people will call and just try to get pricing and they don’t want to sit down. So to me, if you don’t want to sit down, all you care about is pricing. Hey, that’s cool. There’s probably another place for you. But if you’re willing to sit down, then usually I’ve got you.

Chris (29:31):

OK, man, that is really insightful. I see people taking notes. So if you’re on a zoom call and you’ve got a question for Miles, you can just unmute yourself in a moment. If you’re on Facebook, just type in your question under the video. So Miles we talked about at the start, how some of the earliest boxes in these big cities would kind of set a ceiling and nobody wanted to charge more than them. You’re really setting a foundation or creating a platform for other people in your business. But your example is kind of creating a platform for other people who aren’t in your community, or they’re not in Two-Brain, but they know you, they see you. How are you helping people raise their rates and see their value in Atlanta?

Miles (30:11):

Yeah. You know, people will just, people observe, right? I mean, just because they don’t comment on your social media or even if they’re not a member of your gym, they observe, they realize that man, this guy has been nine years now. It’s 10. Now it’s 11. Now it’s 12. And you know, they observe and they want to know what’s your secret, you know, what is the secret?

Miles (30:35):

And so that allows me opportunities to sit down with people, like you said, outside of the industry. I’ve sat down with pastors. I’ve sat down with other entrepreneurs. Sat down with counselors, sat down with just moms and dads trying to figure things out. One guy, I sat down with, he was a owner of a cryotherapy place. And you know, we sat dow and I said, Hey man, how can I help you? Because you know, cryo got hit hard. That industry got hit hard. He looks at me, he said, man, that’s the first time anyone’s ever actually asked me that. Like, how can I help? So having that help first mentality becomes infectious. And people know you, you know, your reputation will start to build like, man, I may not be able to go to Miles’ gym, but I know he can help me find this, this and this or he can help me talk about, you know, what I should do to my boss if I have a question about, you know, my value as an employee or something like that. So, just being available, that’s the biggest thing. You know, posting positive things, obviously it’s a very negative world. And if you’re somebody who’s known to do that, to help people to post positive things, you know, people are gonna find you, they’re going to ask for help.

Chris (31:44):

Very true, man. Yeah, I do think that, um, you’re a very attractive person to talk to, which is why I really wanted to chat with you today. So if anybody has questions on zoom, just unmute yourself. But if somebody is listening to this, they’re in Atlanta, even if they’re not in Two-Brain, like how can they reach out to you Miles?

Miles (32:03):

Yeah. Any way, you know, you can shoot me an email, miles@crossfitsouthcobb.com.

Miles (32:10):

If we’re friends on Facebook shoot me a message directly on Facebook. You can send me a message through the gym’s Facebook page or the gym’s Instagram page. Those are probably going to be the best ways to reach me.

Chris (32:22):

Miles. You mentioned some gym owners haven’t seen the light about their value. Have you seen this epiphany happened? And if yes, what helped them get to that mindset shift?

Miles (32:29):

Honestly the only ones that I really see and have been a part of a group, I think there’s something to be said about that kind of herd mentality. Like we’re in it together. I’ve seen very few kind of go off on their own and really try to drive the bar up. The ones that kind of go off on their own to be their own, they’ll just kind of stay in their niche, but they’re not really trying to drive up anyone around them.

Miles (32:57):

So only those that I’ve seen a part of a group, maybe it’s this mentorship group or another one have I seen them actually kind of make moves in the marketplace. Other than that, you know, people have just kind of been trying to hold on to whatever they have instead of even having any sense of a growth mindset.

Chris (33:13):

So growth mindset is part of it for sure. But courage, I really think is part of it too. Is it just that the lone wolves lack support?

Miles (33:22):

I think so. Absolutely. And people, the culture right now that I’m seeing in Atlanta, because we have a kind of Atlanta just CrossFit gym owner group, and it’s very, very quiet, people just aren’t even using that. You know, so yeah, it’s probably courage based for sure. You know, it’s like, Ugh, I’ve accepted my reality. No one else is probably doing any better.

Miles (33:47):

So I’m not even going to bother asking anyone else for help about anything.

Chris (33:50):

That’s a shame. Blake, you have a question, man.

Blake (33:53):

Yeah. Miles. I appreciate your time today. Raising our rates here soon. And I’ve been talking about it with our coaches. So, you know, obviously you guys have high ARM and probably length of engagement as well. So how do you go about building in confidence into your coaches? Maybe you just do sales exclusively.

Miles (34:12):

So, the way we’re structured, it’s either myself or a CSM. And I don’t know if you have a CSM. So we have layered our organization so a coach is really coming in to coach. They understand the process of how new members coming in, but they’re not really charged with selling people. You know, with COVID, there’s not really a lot of walk-in traffic anymore, so we’re not really having to train our coaches about, you know, talking up our rates or anything like that.

Miles (34:39):

It’s usually like if someone does walk in, Hey, let me get your information or I’ll have our CSM, our owner give you a call. So to that point, honestly man, I use it as a win for them. I said, Hey man, look, or, Hey guys, you know, it’s 2021. Just want to let you know, we’ve raised our rates because we think you guys are worth it. So I’m going forward on your paychecks with one-on-one personal training, your rates are gonna go up XYZ. And then, you know, from a group perspective, I’ll do it one or two ways. If someone’s due for a raise and we’re kind of talking about that, we’ll use it same thing. We’ll say, Hey look, because we raised our rates. And also because of your amazing performance, we’re going to give you a raise here.

Miles (35:20):

The other thing coaches love to see is the money being reinvested back into the box. So this isn’t a ploy to say, go buy 10 rogue echo bikes, but what I’ll say, Hey, look, you guys are crushing. The gym is doing really well. You know, people are buying into the value that you create. So we’re because of that, we’re able to upgrade some things. So here’s some things that you can expect to see on the floor, changing these bars out, doing this, this new bike, whatever it is. So some little piece of carrot that I’m giving the staff and I’m always turning it around for their benefit, not necessarily saying, Hey look, the owner has now gotten more profitable because we’ve raised our rates. I just want to say, thank you. We always try to spin it in a way that benefits them.

Miles (36:03):

So whether it’s my CSM, you know, she understands the way she’s compensated for certain things will raise because of our rates are up. And then coaches will also understand that.

Blake (36:13):

Thank you for that. I love your point on, you know, investing in your coaches and letting them know that they’re worth it. And then you also touched on showing your members what to expect too. I think that’s a important part.

Miles (36:27):

Yeah. And that’s something that admittedly I could do better at. You know, usually I’m a more of an introverted guy when it comes to me running the business. I like to be kind of the guy behind the scenes, but I’m just, you know, I’m on the floor and I’m like, OK, how can I make this place better? I don’t necessarily have to beat my drum about it.

Miles (36:43):

But I think the biggest value man that people see at our gym is our culture. We have such a consistent culture, such a respectful and positive one that people will want to pay for that. And I’ve always told myself when I built this gym, I wanted it to be a gym that I would pay $200 a month for. And I absolutely would pay $200 a month to be a part of my gym.

Blake (37:02):

Cool. Thank you, Miles.

Chris (37:03):

Two things that you just said that I want to make sure people don’t miss because they’re probably taking notes and you gave a bunch of really great stuff there. The first is that whenever you make an upgrade, you communicate the upgrade to the coaches and your clients, instead of just hoping that they notice, which I’ve definitely been guilty of in the past, you know? And that’s super important too, to say like, Hey, because of this, this other thing happened.

Miles (37:29):

Yeah. And honestly, to touch on that in sometimes it’s the little things like, Oh, Hey miles, this, this rowers making this weird rattling noise, you know, that that day we’re on it. We’re fixing it. This Rover is out of battery. We’re fixing it all, man, that bench is broken. We’re fixing it. You know, the barbell doesn’t spin, we’re replacing it. You know, just it’s the little things and they all add up. It doesn’t have to be, you buy seven new bikes to impress everybody. Because if you’re trying to impress that client, they’re usually the client, that’s an access client anyway. And not a coaching client. Most coaching clients want to be in for the experience, the vibe, and then also the accountability.

Miles (38:07):

And so that’s really the things that we want to invest most in.

Chris (38:09):

That’s great. And the other huge epiphany that you just gave out too, was you started with, what could I sell that would be worth $200 per month instead of how much can I charge for this thing? And I think that’s what led to the trouble in Atlanta, in the first place. And the solution is this forward thinking of leaders like you. So thanks a lot Miles. You know, we really appreciate this and I know a lot of people are going to ge, some hope out of this, as usual Atlanta leads the way, man. Thank you.

Miles (38:38):

Thanks for having me. I appreciate it. Enjoyed it.

Andrew (38:43):

Chris Cooper’s new book, “Gym Owners Handbook” is out now. To get the book and start growing your fitness business today, click on the link in the show notes.

 

Thanks for listening!

On Monday, Two-Brain Radio presents marketing tips and success stories. Chris Cooper delivers the best of the business world on Two-Brain Radio every Thursday. 

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