ust 51.9 per cent of members maintain their membership for 12 months, with an attrition rate of 55.1 per 1,000 per month. These are the topline findings of the White Report, conducted in 2013 (see p71).

Pushing beyond the year mark, after 24 months 24.4 per cent of members will still there, 14.1 per cent survive to 36 months, and only 10.4 per cent maintain membership to 48 months. This is a much steeper decline in member retention than has been seen in previous national studies and is disappointing considering the maturing nature of the industry.

Despite what the popular media will report, members are most likely to quit in July and August (30 and 24 per cent respectively) and then again in November and December (14 per cent both months).

Key factors associated with high retention, low attrition and increased longevity are age, signing a contract and the length of the contract.

Age matters
Age is still a dominant factor in predicting member retention, with older members staying longer. This is consistent with other studies carried out among operators all over the world. Compared to 16- to 24-year-olds, older age groups (35+) are on average 19–45 per cent less likely to cancel their membership – so it’s surprising to see high-end health club chains almost exclusively targeting younger members as part of their new member drive.
While there’s no discernible difference between genders, the descriptive data highlighted that, as a proportion, women were more likely to join public sector facilities than private. In the Black Report we were able to identify that women were more likely to feel they would be judged on appearance in private sector gyms, and that they needed to already look good to fit in; they felt less judged in a public leisure facility.

Contracts drive retention
Evidence suggests that charging lower monthly fees and promoting no contracts is not a formula for longer retention: while it’s possible to sell a large volume of memberships, it has become increasingly difficult to retain those members. The premise that the lower the cost, the more likely a member is to retain their membership does not seem to hold true over time.

Indeed, in our reports, contract length was found to be directly related to the length of membership: enforcing contracts of at least 12 months reduced the risk of quitting by approximately 18 per cent compared to contracts of one month. This is the equivalent of saving around 18 members for every 1,000 members per month.

Memberships sold as deals, such as three- or nine-month contracts, have no discernible effect on 12-month retention rates. In fact, members who have contracts from two to five months’ and six to 11 months’ duration are between 50 and 80 per cent more likely to quit at 12 months.

Private sector clubs sell 48–55 per cent of their memberships as 12-month contracts, compared to 7–15 per cent in the public sector. This may account for a retention rate of 57 per cent in the private sector and 47 per cent in the public sector at 12 months. However, as most 12-month contracts switch to a month-by-month agreement at the end of the 12-month period, this difference in retention rates disappears around month 18.

Blurring of boundaries
Over the four years of the study (2009–2012), it was evident the monthly fee charged by all operators is decreasing. As a result, while many operators describe how they manage their business by a descriptive term (low-cost, mid-market, premium), it’s not possible to gain consensus on what these terms mean. A low-cost operator may charge less than £20 a month, but so might a public sector facility due to its location and population, or indeed an independent private club. That doesn’t mean it’s low-cost or budget – it’s just the price it charges.

Interestingly though, the members interviewed for the Black Report indicated that this general lowering of fees had led them to believe they could negotiate good deals and wait for sale periods before committing to membership.

The quality of facilities within the fitness market continues to improve, and it has become more difficult for the public to distinguish between public and private operators. The Mosaic profiles of members across the five sectors covered by our study – private chains, independent operators, trusts, local authorities and privately managed leisure facilities – now have no distinguishable differences, which suggests that people who were once only likely to join private health club chains are now just as likely to join public sector facilities.

However, when the hotel groups are separated from the health club chains, we can see that hotels and independent health clubs do better at retaining members than the larger branded companies. Hotels could begin to dominate the £45–60 a month price range, as they are able to provide all the added value services previously associated with the bigger chains while still maintaining a small club feel.

Hotel health club members interviewed for the Black Report described the quality of service and the little extras as having a bigger impact on their club usage than brand or size of facility.

These factors may well also be behind the growing trend for boutique studios – offerings that are more personable, smaller in size and offer just one or two products delivered exceptionally well every time.

Adding value
When new, inexperienced members join a club, they believe they will be in the club all the time. When they view studio timetables, they think they will be attending a wide range of classes, so a timetable with 90+ classes a week is impressive. However, experienced members have a far more realistic understanding of how frequently they will attend and which specific classes they will do; instead of seeing 90+ classes, they identify the times and classes they will attend and ignore the rest.

Meanwhile, customer service has been shown by the Black Report to be associated with retention across the board. Members report staying at clubs where they feel valued, which comes from personal interaction with staff, using names, offers of programme updates and reviews, recommendations of classes or exercises, remembering details about the member’s goals and what’s important to them.

While many of those surveyed reported not needing help themselves – the Black Report specifically spoke to seasoned gym-goers – they are disappointed by the lack of advice and correction to members who clearly have poor or incorrect training habits, observing that staff seem happy to talk to savvy, experienced members but not the members who actually need help.

The fitness industry continues to look for alternative solutions to retain members, despite the fact that members have repeatedly stated that service is of most importance to them while exercising. Understanding this would help operators develop a more complete business model designed to maximise the length of membership of every member.

Maybe the rise of boutique and niche facilities – the new breed of microgyms – will finally convince more established operators to listen to their members.