Using Technology To Improve Membership Sales & Retention

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Using Technology to Improve Membership Sales & Retention

Trends & Solutions

IHRSA 2011San Francisco, CA

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Bryan O’Rourke - Who ?

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Bryan O’Rourke Who ?

Bryan O’Rourke - Who ? Who Dat !

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connect with me @

www.bryankorourke.com

https://american.redcross.org

give and I’ll give you 1 hour of free consulting

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THANKYOU

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Using Technology to Improve Membership Sales & RetentionTrends & Solutions

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BROAD

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3(main topics)

11Hang With ME

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1. TRENDS:consumer & technology

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2. FACILITIES:big business challenges - kpi

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3. SOLUTIONS:emerging & future

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Format:Collaborative Consumption

At The End OfEach Segment

2 QuestionsBlogs On Topics

To Follow

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1. Technology & Consumer TrendsConsumer & Technology Trendswww.bryankorourke.com

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“The Purpose Of Business Is To Create

And Keep A Customer”

Peter Drucker

Tony Hsiehpronounced“shay”

Author & CEOFriday March 18 - 8:30 - 9:30Happiness A Path To Profits, Passion & Purpose

Its All AboutCustomer Experience

Business Is Changing

"We are massively underestimating this culture

shift... We are in the era of the humanization of business. We're living by small town rules again."

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trendwatching.com is one of the world’s leading consumer trends firm, relying on a global network of hundreds of spotters. Our trends, examples and insights are delivered to 160,000 business professionals in more than 180 countries

CONTEXTCUSTOMER

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When it comes to the mega trend of GENERATION G (that's G for Generosity, not Greed), there’s no better way for a brand to put its money where its mouth (or heart) is than engaging in Random Acts of Kindness (R.A.K.). Consumers' cravings for realness, for the human touch, ensure that everything from brands randomly picking up the tab to sending a surprise gift will be one of the most effective ways to connect with (potential) customers in 2011.

INTERESTING 2011 CONSUMER TRENDS

WWW.TRENDWATCHING.COM

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Urbanization remains one of the absolute mega trends for the coming decade. Here's just one telling stat: “Today, half the world’s population – 3 billion people – lives in urban areas. Close to 180,000 people move into cities daily, adding roughly 60 million new urban dwellers each year.” (Source: Intuit, October 2010) 100 cities comprise 30% of the global economy. urban consumers tend to be more daring, more liberal, more tolerant, more experienced, more prone to trying out new products and services.



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More consumers are constantly connected, and when they hear about new deals online can quickly and easily spread them through their social networks.Increasingly, consumers will be part of exclusive networks or groups to either receive special deals or demand them.Mobile devices increasingly enable consumers to find or receive dynamic deals right at the point of sale, or to compare prices online. Case in point: Amazon.com just released an iPhone app that allows users to compare prices by scanning the product's barcode, photographing it or saying its name.



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Online culture still is the culture, and thus we'll see a rise in online status symbols in the next 12 months (after all, status symbols reflect the zeitgeist like nothing else). What started with showing off the number of visitors to one's Flickr pages or blog now also encompasses the number of one's Facebook friends (or any other social network), Twitter followers, Foursquare check-ins and a host of other metrics that indicate one's 'wiredness'. In the next 12 months, you can’t go wrong supplying your (online-loving) customers with any kind of symbol, virtual or 'real world' that helps them display to peers their online contributions, interestingness, creations or popularity.



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73% of US consumers consider being physically fit important to being ‘well’(Source: The Hartman Group, August 2010)

500 million people worldwide are expected to be using mobile healthcare applications by 2015. (Source: Reasearch2Guidance, November 2010)

There were nearly 17,000 health apps available in major app stores in November 2010, with 57% of them being aimed at consumers rather than health care professionals. (Source: Reasearch2Guidance, November 2010)



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Expect a rise in ECO-SUPERIOR products: products that are not only eco-friendly, but superior to polluting incumbents in every possible way. Think a combination of eco-friendly yet superior functionality, superior design, and/or superior savings.



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*According to Jeff Jonas at IBM, mobile devices in the US are creating approximately 600 billion geo-spatially tagged 'transactions' a day (that's every call and text, not just web connected smartphones!)

For consumers, knowing where they are and what's / who's around them is the key to PLANNED SPONTANEITY. That's about to get a whole lot easier, as geo-location becomes a key feature of social networks and web apps (from existing providers adding location information, such as Facebook's Places, Twitter's locator, and Google's Hotpot, to dedicated services like Foursquare, Gowalla and Brightkite)



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Traditional ownership implies a certain level of responsibility, cost and commitment. Consumers looking for convenience and collecting as many experiences as possible want none of these things.

Fractional ownership and leasing lifestyle businesses offer the possibility of perpetual upgrades to the latest and greatest, the ability to maximize the number and variety of experiences, and allow consumers to access otherwise out-of-reach luxuries.Owning bulky, irregularly used items is both expensive and unsustainable,

INTERESTING CONSUMERTRENDS


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engagement

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http://europeanwebreport.ning.com

engagement

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www.byrankorourke.com

new business models

rachel botsman

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“The World Has Changed. Power Has Shifted To The Customer. They Don’tTru s t Adve r t i s i n g . They Wan t Authenticity. They Want Engagement. T h ey Wa n t Va l u e . T h ey Wa n t Connection.”

Bryan O’Rourke

IF YOU don’t do it

Someone ELSE WILL

“The Purpose Of Business Is To Create And Keep A Customer”

Peter Drucker

Do YOU Believe This ?

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5 ImportantTechnology TrendsFor 2011

for more visit www.bryankorourke.com

what is

DRIVING consumer

change ?

“If GM had kept up with technology like the computer industry has, we would all

be driving $25 cars that got 1000 MPG”

Bill Gates

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INTERESTING 2011 TECHNOLOGY TRENDS

WWW.BRYANKOROURKE.COM

CLOUD COMPUTING

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more computing powersoftware as a servicegreater functionality

better ROIless costly

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MOBILITY

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whenever whereverlocation basedfunctionalsocial

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SOCIALIZATION OF THE WEB

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1) Era of Social Relationships2) Era of Social Functionality3) Era of Social Colonization4) Era of Social Context5) Era of Social Commerce

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APPSnew functionality

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highly specializedinexpensivefun

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CONTENTCONSUMPTION

4digitization of all experiencevirtual shadow of physicalsmaller more frequentgrowing the pie

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“Organizations Must Accept A New Paradigm; One Based On Collaboration With Their Employees And Customers. You Must Either Embrace This New Approach Or Become Irrelevant. ”

Bryan O’Rourke

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Consumer & Organizations

The New Paradigm

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2. Club ChallengesWhat Are The Biggest Opportunities For Health Clubs Today ? www.bryankorourke.com

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The New Orleans Connection

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AuthorMichael Lewis

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A Few Other Books By Michael Lewis

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Billy Beane, general manager of MLB's Oakland A's and protagonist of Michael Lewis's Moneyball, had a problem: how to win in the Major Leagues with a budget that's smaller than that of nearly every other team.

CONTEXT:THE RIGHTNUMBERS

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Think Differently

What Do YOU Think Is The #1 Challenge For Health Clubs Today ?

THE KPI

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• Attrition: Nearly 10.5 million people joined a health club in the U.S. in 2009, while 10.7 million dropped their memberships, producing a “churn” or attrition rate of 24%.

• Core members: “Core” users remain members of their club for approximately 21.5 months longer than casual users. Assuming average monthly dues of $41.47, converting one member to a “core” user would therefore generate nearly $900 in extra revenues.

Attrition & Engagement

THE KPI

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THE KPI

the Sell SELL

SELL culture

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HOW MANY OF US THINK ABOUT

ATTRITION-RETENTION IS WRONG1. The attrition percentage is heavily influenced by the number of membership sales. Between June and July the attrition % fell (from 5.0% to 4.9%), yet the number of cancellations increased (from 126 to 129)! It is clear in this example that the reduction in attrition was caused by a large amount of new joiners in June and not by any improvement in the retention of existing members.

2. The attrition percentage does not take into account HOW LONG A MEMBER HAS BEEN RETAINED. It is possible to see huge variances in the membership duration of each member that cancels.

THE KPI

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HOW MOST OF US THINK ABOUT

ATTRITION-RETENTION IS WRONG

In order to understand how to improve retention operators need to measure:

1. THE RETENTION RATE defined as:The proportion of members who stay for a predefined period of time e.g. 3, 6, 12 months etc.

2. LIFETIME VALUE defined as:The average length of time members stay and therefore how much they pay in membership fees.

THE KPI

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Segmentation - changes how we manage market and engage members

all members are NOTthe same

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1. Retain Members By Making Them Happy

The Health Club BusinessKnow your customers and analyze the right numbers.

2. Intelligently Manage Costs

THE KPI

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winning the unfair game

www.polledemaagt.com

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winning the unfair game

Manage expectations

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What Billy Beane, knew about baseball we know about the health club business.

THE KPI

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Working with the UK YMCA in 2006- 2007 and as part of his PhD. research, Dr. Paul Bedford applied his behavioural change strategies at the Central YMCA . With resulting increases in average membership length from 7 months to 13 months, and reduction in cancellations

from an average of 77 per 1,000 members per month to 23 per 1,000 per month.

Dr. Paul Bedford

4:00 pm Wednesday March 16, 2011Talk’s Cheap - Applying The Psychology Of

Persuasion And Influence In Sales

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WHAT A SURPRISE

Engaging members impacts attrition !

Bryan: We Hear You But How Do We Measure Correctly, Know Our Customers Better And Engage ?

THE KPI

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3. Current SolutionsHow Can Technology Impact Retention & Member Sales Today ? www.bryankorourke.com

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Strategy & Tactics

Ask Yourself These Questions

“What Are Or Is Your Club’s Technology Platform(s) ?”

remember the “cloud”,intelligently managing costs

and consumer trends?

can you..... segment member types and behaviors ?engage via email, text and social networks ?engage by member types and behaviors ?deliver customized web content to users ?provide on line bookings and memberships ?

you need to ...

“What Are Or Is Your Club’s Technology Platform(s) ?”

Upgrade Your Website - Online Membership

Make it socialenable on line registration

customize user content

Create A Mobile Application

Make it socialcustomize user content

location services

Mobile And RFID Technologies Emerging

better data modelingmicro transactions - membership tracking

enables unbundling of memberships

Rick Stollymeyer 2:00 pm Wednesday March 16, 2011The Future Is Technology Get Your Club Connected

“Do You Understand WhyMembers Are Coming And Going ?”

remember consumer trendsand retention challenge?

“Why Are Different Members Coming and Going?”

are you..... tracking RELEVANT data around joins and cancels ?looking at the “life cycle” of your membership ?creating a predictor model ?engaging members around the model ?

you need to ...

Aspirations Mapping

Where Member

Segmentation, Programming

& Engagement Align

Customizing Member Engagement

Bridging The Physical & Digital - Outside & Inside The 4 Walls

[email protected]

[email protected]

“How & Where Are You Investing Your Marketing?”

remember engagement and intelligently managing costs ?

“How And Where Are You Investing Your Marketing?”

are you..... shifting funds away from traditional media ?trying to make digital engagement work ?tracking ROI of campaigns ?sharing targeted and relevant engaging content ?

you need to ...

Mobile Targeted Promotion -THE SINGLE BIGGEST TREND

Mike Bannan 4:00 pm Wednesday March 16, 2011Growing Membership With Yelp, Google Places &

IDEA Fitness Connect

Steve Groves 11 am Wednesday March 16, 2011Release Your Inner Geek: Social Media For Fitness Professionals

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Upcoming - Engagement Via Social CRM & Gamification

“Is Your Equipment & Programming Engaging ?”

remember consumer trends& intelligently managing costs ?

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equipment - treadmill “coach”

automated delivery

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group programming

automated delivery

You can forget most of the crazy things I said & showed you today.just please try and remember these 55

“The purpose of business is to create and keep a customer”Peter Drucker1

Consumer trends are changing andtechnology has a lot to do with it2

5 technology trends for 2011: cloud, mobile, social web, apps, content3

Key kpis for health clubs are member lifespan, engagement & cost management.4

Strategic use of technologies to service and engage members will be essential to success.5

requiring you to....

THINK differently

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think differently


thank you

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connect with me @


THANK You

Using Technology To Improve Membership Sales & Retention

Business

consumer trendswww

consumer technology12

consumer trendsmore

andconsumer trends

theabsolute mega trends

purpose of business

online culture

bryan orourke