Fitness club finds healthy way to retain members

Personalized health management proves to be a hit with customers

There is a collective sharp intake of breath at most of China's fitness clubs once a year when their marketing departments report the membership retention rate. On average, only 20 percent of members renew.

The horror at the thought of such depressing figures on a monthly basis, means that generally only annual membership deals are offered.

But some club operators believe there are better ways to keep members happy.

"You can never hold on to your customers unless you provide a service they really need - or even surprise them," said Jiang Li, executive associate general manager of Impulse Fitness Club, which has 108 clubs in more than 30 cities in China.

The Impulse way is to broaden the service from basic fitness provider to personal health management, and by pioneering this new business model, Jiang said, it will alleviate the agony in an industry struggling to hang on to its customers.

In parallel with its fitness club chains, Impulse is building a network of health management specialists to provide customized services, and so enter a market left almost empty by the absence of private doctors and home-visiting general practitioners.

Very few people in China have a private doctor, with most reliant on the state healthcare system.

"A health management specialist is hardly an alternative to private doctors, but clearly the market demand is huge," said Jiang.

Clients who sign up for the health management program at Impulse are profiled in detail, providing information about their lifestyle habits and family history of diseases, and undergo and physical health examination.

Specialists will provide appropriate personal health and fitness programs, including exercise and diet regimes. These are then monitored and assessed.

All health management specialists, Jiang said, must have qualifications issued by the Ministry of Health. Most will be majors in sports medicine.

Architect Yi Minxue, 45, was one of the first customers at Impulse's new business in Suzhou, in eastern China's Jiangsu province.

"We are getting old and our parents more so," Yi said. "I've been looking for ages for a private practitioner or a sports medicine specialist to give me and my family health advice and a physical examination now and then, but it was not easy to find a reliable and qualified one."

Yi said he knows of many others who are looking for the same thing.

"Architects are apt to be super busy and below par health-wise," he adds. "My health manager at Impulse is helping me to get the most from a healthier diet and limited exercise time."

Health management members like Yi are also given monthly lectures where health and lifestyle issues are discussed, and they are free to use the facilities in any Impulse club.

Jiang said Impulse introduced health management into its fitness clubs in early 2009 in Suzhou, and soon after to all its 108 in the country. It now has more than 20,000 health management members.

"An 80 percent year-on-year growth in the section of health management business and a 90 percent margin contribution indicates a good market and a feasible way for reviving gyms," she said.

"The low retention rates of fitness clubs are partly due to people's lack of perseverance and ability to continue independent exercise.

"When members feel there is concern for them, that they are being monitored and encouraged, they are more likely to persist in doing exercise.

"Persistence has an effect, and the effect is satisfying, resulting in good word of mouth and a high retention rate."

Health management membership fees range from 2,000 yuan ($320) to 20,000 yuan a year depending on the level of service.

Jiang said health management memberships fall into three categories: general members, family and individuals with special needs, such as those relating to obesity, illness or injury.

She said currently more than 60 percent of the health management members are family ones, especially those prone to hypertension, hyperglycemia or hyperlipidemia.

Impulse is hoping to cooperate with enterprises and colleges so that the employees or students can join at a discounted corporate fee.

Impulse Fitness Club, headquartered in Qingdao in Shandong province, is a national chain of upmarket fitness clubs, and is part of the Qingdao Impulse Group, a fitness equipment manufacturer founded in 1991 with investment from Taiwan.

Jiang said Impulse's core competitiveness is the data integrity of its members' profiles. Since Impulse started as a fitness equipment maker, it has formed a complete industrial chain from facilities, fitness clubs to health management.

"Soon chips will be embedded into all the equipment at Impulse fitness clubs, and all the sports behavior and motion indexes of each member will be recorded," said Jiang.

The recorded information will be collected into a national fitness database, a cloud platform recently built by the Chinese Ministry of Science and Technology.

"Our advantage is we are capable of producing the chips, the equipment and all the updates," she said, adding that several Impulse Clubs have been building local databases since April.

Jiang said all these records enrich members' profiles, the data proving helpful in further analysis and guidance of their health management, and making the service more scientific, accurate and in-depth.

Jiang said they are also willing to cooperate with other fitness clubs in places where there is no Impulse club.

"We still want our clients to enjoy exercising in gyms, and a contract with other clubs is needed here," she said.