Background
Our client is an international fitness organization with more than 1,000 locations across the country. This fitness club offers various programs that are tailored to fulfill the requirements of the communities they serve, benefiting thousands of individuals annually.
The primary focus of this study was to analyze 30+ facilities located across several key states. In past years, our client experienced year-over-year growth in membership revenue in most locations. However, when the COVID-19 pandemic hit and they were forced to temporarily close their facilities, more than 30% of this revenue was lost. Until now, they have been struggling to bring those numbers back up.
The Iris Pricing Solutions team was initially contacted by the client to recommend a pricing strategy that is based on customer insight, research, and analysis to increase the club’s penetration in the community and meet community needs during the current challenging economic climate.
The Challenge
Our client, focusing on growing revenue to help off-set increased costs and expanding their customer base, sought to optimize membership pricing and bundling. To do so, they wanted simplified membership categories to improve conversion, optimize pricing and bundling of different types of memberships offered, and explore differentiated offerings to create a membership alternative. This involved understanding factors such as price elasticity, purchase value drivers, discounting strategy, and joining fees, to accurately simulate and subsequently analyze price changes.
