Measuring customer lifetime value (CLV) is critical to ensure you’re maintaining a steady revenue stream for your fitness studio. Here are 3 indispensable strategies to increase CLV to help you grow.
What is CLV?
Customer lifetime value (CLV) is a metric that measures how much your business can earn from the average member throughout your relationship with them– until they decide to leave.
Because here’s the thing,
It’s always less expensive to maintain an existing relationship than to create a new one.
So having a good CLV metric means your business is doing well at retaining members, growing with them, and upselling offers– thus… spending less on member acquisition.
The CLV calculation considers several factors:
✅ Average order value
✅ Average purchase frequency
✅ Average customer lifespan
By calculating CLV, you can start thinking strategically about your marketing, sales & customer service efforts so that these metrics improve over time to maximise your revenue & profitability.
Watch this video to learn how to calculate CLV for your business.
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Lucky for you– if you’re using the Octiv gym management platform– you can find this personalised data on your reporting dashboard to calculate your CLV.
Not using Octiv?
3 CLV strategies
It’s all good & well knowing how to calculate your CLV, but you also need to know how to improve it.
Imagine if you implemented strategies to get the average member to stay 6 months longer– your CLV will go up, which means you spend less on member acquisition.
So here are 3 strategies to improve your CLV so that more money flows into your biz bank consistently– enabling you to make better decisions to grow your business further.
#1: Grow with your members
The single most important CLV strategy is to grow alongside your members so that they don’t outgrow you.
If you’re noticing that your members are reaching a place where your gym services are no longer needed, think of ways to bring in new offers that complement their growth journey.
For example,
Let’s say you own a yoga studio, and most of your classes are for beginners. Some of your members may move out of this space within 6 months– so make sure you have an offer that allows them to walk their progression journey. You could offer intermediate classes or a programme that perfects the handstand or meditation breathing technique.
If you don’t walk this path with your members, they’ll find another service that can.
Do this…
And you’ll dramatically increase your CLV.
#2: Personalisation
Personalisation can be an effective strategy to improve CLV because it improves the member experience. Which in turn improves member engagement and loyalty. You can implement this by using the Octiv-gym management software CRM tools.
Your members get a personalised communication & customer support experience that’s customised for each individual.
In fact,
80% of consumers are likelier to buy from a company that provides a tailored experience.
Using the Octiv platform– you can send personal birthday messages to each member on their special day, recognise their achievements via email, or send out automated emails with a personalised name touch. It’s like you are talking directly to them.
#3: Upsells & cross-sells
Upselling and cross-selling are effective strategies as you increase the amount each member spends at your fitness studio.
Say, for instance– most of your members purchase an unlimited membership. You could upsell that membership with an additional top-up service, such as an unlimited membership + 4 PT sessions monthly for an additional cost.
Or,
Cross-sell by enhancing the merchandise within your fitness studio, from coffees to shirts to supplements.
If you can increase the amount the average member pays per month from upselling or cross-selling– your CLV will increase.
Conclusion
Implementing customer lifetime value strategies can be a powerful way to grow your business by increasing customer engagement, loyalty, and revenue.
Growing with your members, offering personalised experiences & providing additional services in the form of upselling and cross-selling– create a more valuable and enjoyable experience for your members. Which ultimately leads to sustained growth for your fitness studio.