The Secrets of Exponential Growth in Gyms

Chris Cooper

Mike (00:02):

Today on Two-Brain Radio, Chris Cooper pulls the curtain back on the marketing buzz phrase “exponential growth.” What does it mean to gym owners and how can you achieve it? Coop explains right after this.

Chris (00:13):

Chris Cooper here to talk about Level Method. When it comes to owning a gym, it can be really tough to show your members their progress and keep them engaged long term. Level Method provides experienced gym owners with a visual step-by-step fitness progression system that’s fun, engaging and easy to use. With Level Method, your clients can reach their fitness goals faster and safer than ever before and become raving fans of your gym. It’s a total game changer that creates powerful moments that you’ll never forget. I use it at Catalyst, it improved my conversion and my retention. Go to levelmethod.com to find out more.

Chris (00:46):

Hey everybody, it’s Chris Cooper here. And today I’m going to talk to you about the secrets of exponential growth. Now that sounds kind of like a biz-coachy term or something that you’d see on like an ad for some marketing secret thing for gym owners, but I’m a literalist.

Chris (01:01):

I love the English language and I love thinking about the actual meaning of words. And so exponential growth is anything that reproduces itself creates growth. So if you’re thinking about exponential growth in your savings, for example, a good example is compounding interest. You make 5% interest on your hundred dollars that you invest somewhere. And then next year you make it 5% interest on that $105. So you make another, you know, whatever it is. And then that compounds year over year, and you have this outsized effect. The more times you allow it to compound. So 30 years from now investing that a hundred bucks or whatever is actually worth thousands of dollars, thanks to the miracle of compound interest. Well, we can produce that same thing in our marketing. Linear growth is when you do some marketing to get one new client. So running Facebook ads is a great example of linear growth.

Chris (01:59):

Facebook ads can produce multiple clients, but only one client at a time. And each new client that you bring in does not necessarily translate into multiple clients. The new client doesn’t necessarily go out and get another new client until you take some action to make that happen. So exponential growth in your gym is when your client goes out and gets another client for you. We’ll have to push this process. It’s not a passive process. You can’t just wait for it to happen. There’s a lot of myths out there that are actually stopping gyms from growing because every gym owner, every person listening to this podcast knows that the best new clients come from referrals, right? The problem is that the referral process is too slow because it’s passive because we as gym owners just think like, well, if I get people great results, if they’re having a good time, if I have a quote unquote, great community, then they will just bring their friends.

Chris (02:53):

But they don’t because they’re not evangelists for you. Or maybe the subject just doesn’t come up or maybe they’re shy about it. Or in a lot of cases, maybe they’re actually keeping you as like their best kept secret to themselves. Maybe you are their private place where they go to get away from their friends and family. And that’s a problem. But in most cases, it’s simply a matter of your clients are not salespeople. They love you. And if somebody says, who’s your personal trainer, they will refer you, but they’re not going to walk up and down the sidewalk wearing a sandwich board. So the myth is that if I just build a great product, people will refer their friends. Or if I just get my clients results that will naturally magically attract other clients. These are myths. And I want you to turn referrals into an active process.

Chris (03:43):

And that’s what exponential growth means, that your clients are bringing in other clients, that you don’t have to go out and single-handedly get every new client for your gym. So here are the steps. Start with a one-on-one conversation with your clients. Now you have to set the stage. You have to create a culture of referral. So during your intake process, tell people that you will be asking them for a referral if they achieve the results that they want in 90 days. OK. Go ahead and pull out your client journey and write that down as part of your intake process. Hey Jill, just so that you know, if I’m doing a great job 60 to 90 days from now, I’m going to ask you for somebody else in your life who could benefit from this service. OK. So 90 days into the client journey and the way that we teach this in Two-Brain is something that’s called the first 90.

Chris (04:35):

And there’s a workbook where we map all this client journey stuff out. And we tell you, like on this date, do this, send this email, send this text, send this reward, send this thank you. Have this coach, call them, have the book and appointment. It’s all in there. And it’s called the first 90. At the 90 day mark, a client has their first goal review. Now that goal review is basically an assessment of their progress. So the client comes in and they get on the InBody or you put them on the scale, or however you measure their progress. And you ask, how are you perfectly happy with your results, et cetera. Then you say, is there somebody else in your life who would benefit from this service? So the first thing is, you’re just asking them, is there anybody obvious that you can refer to this business?

Chris (05:19):

And most of the time they’re going to say no. People don’t like giving their recommendation to their friends. They don’t like feeling like a salesperson, or maybe they don’t trust you enough to give their friend’s phone number yet. That’s fine. We’re going to follow up with this because most gyms, if they ask for referrals, they stop here. This is as deep as they go. They ask the client to say, who in your life would benefit from this service and that’s it. But most of the time that doesn’t work. So at the next goal review, 90 days after that you’re meeting the client, you’re checking their progress, et cetera. You’re making sure that they’re actually making progress and that they’re happy at this review. You’re going to be more directive. So you’re going to do the affinity marketing cheat sheet. You are going to decide on the potential referral that you want to earn.

Chris (06:07):

And then you’re going to take action on that. So you can download our affinity marketing cheat sheet for free, and I’ll post the link in the show notes here. Basically what you want to do is you want to think about the client that’s coming in. So you’ve got a goal review with somebody at 11 o’clock today. It’s nine o’clock. Now you’re sitting at your desk, you have a coffee, and you think who are the people who surround this client? So who do they live with? Who do they work with and who are their best friends that they do something with. So, OK. Mary is coming in at 11 o’clock today. Who does she live with? Her husband, George. Who does she work with? Well, she’s an accountant at a firm downtown. I know that. And who does she play with? She doesn’t have a lot of time for hobbies because her kids both play basketball.

Chris (06:51):

And so she mostly just sits in the stands and talks to other parents. What we’ve got there are three potential direct referrals from Mary. The first and most obvious is her husband George. So you think like, what do I know about George? Could my service help George? How could my service help George? And if it’s obvious, if you can come up with an answer, then that’s what we’ll pitch to Mary when she’s sitting in front of us. But if it’s not obvious, yeah. Maybe George is already doing his own thing. You know, he’s doing, he’s a cyclist. He has his own coach, whatever. Then you turn to the next most likely referral, which is Mary’s coworkers. And you think, how could I help the other accountants and bookkeepers at Mary’s firm downtown? Well, it’s late in the year. People are preparing their year ends. I could come in and do a lunch and learn session with them.

Chris (07:43):

I can invite them in to do a group workout to blow off some steam. I could even invite them in to talk to my clients about tax preparation for 2022. You know, there’s lots of ways that you can help. And I break those down in my book help first. Then if it’s not obvious that you can help Mary’s coworkers, you turn to the third most likely referral, which is her friends. And you say, OK, well, you know, Mary’s kids both play basketball. How can I help Mary’s friends? Well, the best way to help them is to help their kids. So invite their kids in for a training session or depending on the age, you know, maybe it’s like a birthday party or a ninja warrior challenge or something like that. I’m sure you’ll have lots of great ideas. And so when Mary’s sitting in front of you, you say Mary I’m so proud of you.

Chris (08:27):

Would you like to tell your story to someone else? And then you say, you know, I was this morning, I was sitting there and I was thinking about your husband, George. And I know he’s a cyclist. I know winter’s coming. From what I know about cyclists, like they use the winter to do strength, conditioning and mobility. Is George doing any of that? Does he have a plan now? Would you like to bring George in next week? I’ll do a training session with him and I’ll show him a few stretches. And then if that helps him, I’ll ask him if he wants to train one-on-one, get some home workouts for three or four months. How does that sound? So what you’re doing here is you’re taking the referral process from passive to active just by demonstrating your knowledge and care of the client. And that’s really what affinity marketing is all about.

Chris (09:12):

It’s finding opportunities to help first and then showing your value, which will translate into a sale. All right. So that’s the second goal review with the client, the third goal review. So now they’ve been with you for nine months. You can ask them to bring somebody to an event. Now, the reason that we’re waiting this long is because events need to be directive. You need to know who’s coming. You need to control the invitations. And I’ll cover that in a moment. But at that third goal review nine months in, you know, that the client in front of you is fairly proficient. So when they bring a newcomer in to do a bring a friend event or whatever, they can help you coach that friend, or they’re going to know kind of who would enjoy it. And who would not. If you’re telling people like, oh, you’ve been here for two weeks, bring your friends to this, bring a friend event.

Chris (10:02):

There’s a good chance that they won’t know like who would be a good fit for your program, or you know how to help that friend. You’re going to wind up coaching them a lot during a bring a friend workout. So I prefer to wait until the nine month mark and say, Hey, do you want to bring a friend to bring a friend Friday? But of course, if they’re one week in and they notice that you’re running a, bring a friend event and they say, can I bring my friend? I’m so excited. Then great. Yeah, take, take advantage of that evangelical period where they want all their friends to make the same choices that they’ve made.

Chris (10:31):

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Chris (10:57):

So let’s talk about events and using them to bring new clients in. And this is a great example of how exponential growth can work. First. A couple of good examples are bring a friend Friday, a wine and WOD, or you go offsite, go into their workplace or they bring their coworkers to you. So bring a friend Friday, is you saying, OK guys, you know, it’s the end of November. We always do bring a friend Friday once every three months, this week on Friday, you’re welcome to bring a friend. They can come in for free. I just need them to register online so that their waivers are all signed and stuff.

Chris (11:35):

We’re going to do a fun partner workout with them, and you’re going to be coaching and helping them through the workout. It’s going to be super fun. They’re going to feel like a million bucks and they’re going to love it. They’re going to thank you for it. So bring your friend and we share like actual posts and SOPs and stuff like this in our growth program. The wine and WOD is like, bring a friend Friday, but you usually say, do you want to bring a group? So, Hey, do you have some friends? You want to narrow down your niche here quite a bit like, Hey, this is for women only, or this is fo, mothers only. This usually works best with women. I have seen a few examples where it’s worked with men, for sure. But, usually like a wine and WOD is a ladies only event, you would usually invite in, like an outside vendor, like Lululemon.

Chris (12:22):

Maybe you would set up like a supplement tasting party and you’d bring in some wine. Everybody would do a workout together. You’d have some wine, you’d have some laughs. And then of course it’s really, really important that you follow up with these people and get them to sign up. And again, with any of these events, you can’t let this be a passive process where they come in, try something. And then like you disappear into the back room as everybody’s leaving, or you’re standing behind the desk waiting to hear that they’re there ready to join. You actually have to talk to each one of these people and say, is this something you would like to do? OK. A third event is to go into their workplace or to bring the workplace to you. So if you have an entrepreneur in your program or you have somebody with a fair, decent amount of respect at work, you know, they’re kind of in an executive or a management level, then you can say, Hey, look, I know your team is under stress right now, or Hey, look, I know your team has kind of a boring job or Hey, look, I know your team has to sit all day.

Chris (13:22):

What if I came in and did a lunchtime session where they brought a paper bag lunch with them, and I actually taught them some stretches that they could do at their desk, or I taught them some focusing exercises, or we talked about nutrition and how to plan healthy lunches. Or I know that there’s a lot of parents at your workplace. What if I came in and blank, you can go deep with this too. I mean, if you’ve got like a workplace that has a lot of labor, you can come in and show people stretches that they can do before their shift and after lunch to keep their backs healthy and safe. The key though is that you’re adding value to your clients, that they don’t see this as you coming in to do a sales pitch, that you’re actually coming into help their staff, their team, even their boss at the workplace.

Chris (14:04):

They don’t feel like they’re doing you a favor. They should feel like you are doing them a huge favor. Another variation on this one is if you’ve got an entrepreneur, uh, you can say, Hey, I know it’s been a crazy, crazy time of the year for your staff. I’ll tell you what, why don’t you bring them in on Friday? I will bring a box of the finest boxed wine, or I will bring the six of the six packiest beer, whatever you want to do, bring some snacks or bring some supplements. It doesn’t matter. And you can bring your staff in at seven o’clock, we’ll spend an hour. I’m going to make a workout that just makes them feel great. Like they’re going to achieve some stuff. They’re going to flip the big tire, maybe in teams or whatever. And you’ll work out together for an hour.

Chris (14:47):

It’s going to be a great time. It’s on me. You know, bring in 10 to 12 of your staff. And again, like you should have a conversation with each of these staff people about your gym. However, it’s really important that you’re doing this as a favor to your client, instead of them doing this as a favor for you. And again, these are all in the book help first. All right. Let’s talk about group events that don’t work that used to see a lot more, but you’re starting to see crop up again. And I’m guilty here too. I did all this stuff. So for example, bring a friend Friday, every Friday. The frequency of this offer negates the novelty effect. So what happens is if you say, oh yeah, every Friday is bring a friend Friday, then there will be no sense of urgency for people to think about their friends, right?

Chris (15:32):

They’ll just wait until a friend says, oh, I’m interested. And then instead of putting that friend through a no sweat intro, they’ll bring them in for a free trial. And now you’re counting on your client to be your sales person and they are not your sales person. So they’re not doing a great job. You’re also going to attract people who are just looking to sample, you know, they’re coming in, they’re trying all the gyms. Maybe they have no intention of joining. Maybe they have no idea what your gym costs, but they see free workout. And so they’re going to come in and try it. And next week they’re either going to come back to your free workout or they’re going to go to a free workout at another gym. So it’s really important number one, that you don’t do these too often, once a quarter seems to work best.

Chris (16:12):

It seems to be the most often you can do it and have good effect and you need to control the narrative around it. So it’s like, Hey Mary, why don’t you bring George to try the workout on Friday? The other thing too is like this workout is a sample, but don’t expect anybody to just fall in love with your program, the way that you did. So the first time I tried CrossFit, I threw up and I said, sign me up. I love this. This is for me. Those people are not around anymore. OK. If you’re trying to attract Chris Cooper circa 2007, good luck to you because that guy was broke and there’s not any of him left. Right? And they’ve either died off or they’ve gotten a lot smarter. The second thing is if you have like a free community Saturday workout or whatever recurring, and this used to be a big problem around 2013, you get these problems with people that aren’t prepared to buy because you haven’t prepared them to buy.

Chris (17:05):

And so when you’re setting up these events, you really want to curate who’s going to be there. You really want to set expectations and you want to make sure that you have a follow-up appointment with these people set up. If you’re really not good at sales, if you’re super shy and you’re super introverted, or you just feel awkward about it, what I suggest is you get everybody to fill out a waiver online. So you’ve got their email address. Add their email address to your email list so that they get your updates and then email them a day or two after they’ve been there and say, how did it go? How are you feeling? Here’s some stretches you should do. When can you come in and talk about our program? OK. Like that. And keep following up with them. Talk to them like they’re humans.

Chris (17:45):

Talk to them like they’re your cousins, your best friend, your mom, what kind of message would you send to your mom the day after she did her first workout? Like send that to them, follow up with them. Lead nurture is the most important part of marketing now. All right. So here are some ways, some things to stick away from as we’re trying to get clients to refer other clients and create exponential growth in our company. I mentioned like frequently occurring events. You know, every Saturday is a free community WOD or whatever, stay away from those. But there are other things too. The first is discounts for referring friends. So if a gym owner said to me, Chris, I will give you $20 off your month next month or 20% if you refer a friend, I would actually think more negatively of the gym owner because I am not willing to sell out my friend’s email address for $20 or 20% off.

Chris (18:38):

If you said a bigger offer, like, Hey Chris, you bring a friend. They sign up for a three month commitment and you get a month free. I’m really going to think long and hard about like, what am I signing my friend up for here? Do I really want them to sign a three month contract even if they might not like it in exchange for me getting a month off. Now, if I can not really afford your service and I’m willing to trade the trust of a few friends to pay for that service for a month. OK. But maybe that’s not the kind of client that you want to attract anyway, that’s up to you. So it’s the same thing with incentives, programs or dollars for referring friends. The other thing that happens is like the math really doesn’t work out on these things long term.

Chris (19:20):

So if I can get a free month for bringing in a friend who signs up for three months, and then they get a free month for referring the next friend, it looks like it’s compounding. But the reality is that like, I’m still providing the service, right? I’m still paying the coaches to train them. I’m still keeping the lights on, but I’m taking like, you know, a 33% hit on my revenue, not even my profit, but on my revenue every time that happens. The other thing too is like these strategies do not have good retention. So if you’re trying to keep good clients longer for a higher value, this is not really a strategy that’s been proven to work in many gyms. Instead, what actually happens is that the gym owner is so focused on these brand new people, doing free trials and you know, not paying for their first month or whatever, that they stop paying attention to their best high value clients and their churn rate actually increases.

Chris (20:16):

So it’s not just a matter of like, I’m not keeping these new people, you actually start to flush your good clients out of the system too, if you don’t do this right. OK. The last one is discounts for long-term contracts. Now this doesn’t really fit into the referral strategy, but it kind of does, because if you’ll say to somebody, I will give you 20% off if you’ll sign a one-year contract, number one, you’re creating this kind of revenue gap. So every time that contract comes up for renewal and those people don’t pay, you’ve got a gap in your revenue, right? Because they’ve got that 20% off or even worse is like, you know, sign up for 12 months and get two months free. What happens is that every time a client comes up to the end of their year, you got to provide that service for free.

Chris (21:01):

And this killed a ton of like big, popular gyms that were like flagship gyms, even in CrossFit, that should have been killing it. They had very great locations. They had amazing staff, caring owners, and they ran these discounts where it’s like, you know, commit for a year and get two months free and eventually just drove themselves out of business. So how does that come up for referrals? When you sign a new person up, you want to put them through your NSI process so that they’re brought on board like any other clients, because you’re going to give them the same coaching, the same care, the same empathy that you would any other client, even though you didn’t have to pay to get that client through an ad. Even though they’re not a stranger, even though they’re brought in by referral, you still want them to go through your process so that you’re treating them as an individual. And then, so you can get a referral from them later. Yes. You have to do a great job. Yes. You have to get your clients results. Yes, they have to love you. But if you wait for them to generate referrals, you will never achieve exponential growth

Mike (22:06):

Two-Brain Radio airs twice a week and features all the info you need to run a profitable gym. Subscribe so you don’t miss a show. Now, Coop’s back with an invitation.

Chris (22:15):

Thanks for listening to Two-Brain Radio. If you aren’t in the Gym Owners United group on Facebook, this is my personal invitation to join. It’s the only public Facebook group that I participate in. And I’m there all the time with tips, tactics, and free resources. I’d love to network with you and help you grow your business. Join Gym Owners United on Facebook.

 

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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