BreakingMuscle
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The 6-Week Challenge: Playing a Losers Game

Craig “Patty” Patterson
Guest Contributor
Business, CrossFit

As an independent gym owner or a fitness professional, you always need to be asking yourself: What business do I want to be in? What will win in the end? Fads and trends and marketing ploys come and go, and before blindly jumping on board whatever new game those around you are playing, you always should consider if it’s right for your business.

 

For example: Let’s consider the 6-week challenge culture that has all but engulfed the fitness industry lately. The latest version of the concept—brought to you by another marketing company—promises to deliver 100-plus new clients to your gym in 30 days.

 

I get it. The appeal is so strong it can make a gym owner literally salivate. Especially if you’re not getting many leads off your website anymore, and you’re struggling to generate leads organically.

 

Buyer beware, it’s a crisis waiting to happen—for the business, for your coaches and for your clients. We have seen where this all leads many times before, and it’s dire.

 

History and Perspective

Crossfit launches into the stratosphere. The result: Churn and Burn (i.e. coach and client retention is dismal). MadLab Group data shows annual client churn rate is 70% in most affiliate facilities, while the average coach sticks around the gym for less than two-and-a-half years.

Enter Groupon to pick up the slack: The result: More churn and burn. Client churn rate increases to 80 percent and group class coaches usually don’t last even two years.

 

The 6-week challenge is born: More of the same results ensue. The first challenge you launch generally produces revenue, but there are diminishing returns on each consecutive challenge, and the gym’s brand and reputation starts to get destroyed.

 

Enter 6-week challenge 2.0: A whole new wrecking ball! The 6-week challenge 1.0 had a major flaw: Most of the clients it brought in didn’t stick around, and you weren’t able to replace them with others. To counter this, the 2.0 version traps the owner—who is fresh off a big influx of cash and buys into a 3-year contract for $90,000—which promises:

 

  • Unprecedented retention from cheap clients and coaches
  • Unprecedented massive upsells to personal training from cheap coaches and clients

 

As a side note, in version 2.0 there’s also some sketchy bait-and-switch marketing going on, which essentially serves to trick the buyer. Basically, the buyer has to put a $600 deposit on the 6-week challenge, which he/she will get back should he/she lose 20 lb. or 5 percent of body weight.

 

This only attracts all the wrong people—people coming in for a quick hit, who have been manipulated into signing up for all the wrong reasons. Needless to say, in version 2.0 the gym owner will be left with a bunch of disgruntled clients at the end of the challenge, who the gym owner and coaches will have to try to upsell at the end of it all. Pretty tough to sell someone who feels as if he has been tricked. Meanwhile, the marketing company gets a serious payday.

 

But I digress, I’m here to tell you, even if you win this version 2.0 game, you will lose. Because personal training is the end game with version 2.0, and this isn’t the game you want your business to be in.

 

Essentially, the first three all failed in the same way, and so will this one. Only this time the owner will be on the hook for $90,000.

The real irony here: The marketing companies even admit there is a serious problem. In one of the more popular versions, one of their marketing campaigns features a gushing new client who just got 50 new clients: ”We all know there is a hole in the bottom of the bucket and we need to keep on filling the bucket.”

 

Why is There a Hole?

It should be pretty clear by now that the group exercise business model simply doesn’t work. If you think filling up a group OnRamp and paying coaches by the hour to coach it, and then graduating clients to an even bigger group class is going to work, give your head a shake. This system has failed the coaches, the clients and the gym business consistently for more than two decades in our industry.

 

The answer to this hole is always to generate more leads, so in that sense the new marketing companies are useful. They bring in an influx of new clients, and it’s a quick way to generate revenue. So from that standpoint, it works. For a little bit, at least. But if you’re relying on the free or low barrier to entry crew who have been manipulated by quick fixes and ‘lose 20-lb. in 30 days’ marketing to keep your gym alive—and are paying your coaches by the hour to deliver fitness to these inexperienced, usually, fickle fitness enthusiasts—you’re going to be let down in a hurry. And so will your coaches.

 

Why? Aside from the business model being broken, you’re now also attracting the wrong people. A short-term marketing campaign promising fast results at a low cost, delivered in a group OnRamp setting, is going to churn at 80% a year or more. Sure, there are some good clients who might slip through the cracks, but as a general rule, you’re recruiting dabblers, not people looking for real coaching or long-term change and they have been manipulated into showing up at your door.

 

“No, no, no,” say the marketing companies. “We’ll be able to upsell these members into higher services like personal training….and retention is our #1 focus”

 

This is a fallacy when you’re fishing in a pool of cheap people, delivered by cheap coaches. All it does is provide you the challenge of trying to turn cheap people into expensive people. It’s like fishing in a trout pond expecting to catch a black marlin with a stick and a worm (i.e. cheap coaches).

And the real stretch here is that even if you do convert some clients into personal training, (MadLab Group data sources say 1 out of 30) and you manage to convert $20-an-hour group class coaches into personal trainers, that’s still not an endgame win for anyone. In this case, you end up with a low percentage of clients sticking around, and personal trainers burning out and leaving, too (The shelf life of a personal trainer is less than two-and-a-half years. Usually, they either burn out from having to work too many hours and leave the industry, or they start shopping around for a better deal at another facility and take their clients with them).

 

My company has studied this at length. We have worked with hundreds of gyms who were tempted by things like Groupon, 6-week challenges and on and on. The result: The yearly churn rate is upwards of 80%, with the vast majority of these people lasting just a couple months.

 

Even direr, though, is what this business model does to your coaches: Getting paid by the hour to coach a group class of beginners doesn’t lead to professional coaches who want to stick around your facility and earn a professional wage in the industry for years to come. The vast majority of these coaches won’t last more than a year. This is because coach development and coach evaluation are impossible in a 6-week fitness challenge environment, so you essentially have zero chance of providing an opportunity for your coaches that will afford them a fulfilling career in the fitness industry. Instead, these types of challenges create cheerleader coaches here for a short time and are the best way to destroy long-term coaching careers.

 

So how do you attract high-paying, stable clients looking to make lasting change, and professional coaches who stick around for their entire career?

 

There are three major puzzle pieces to this:

 

  • Coach Development/Mentorship
  • Coach Co-op and Hybrid Gym Model
  • Coach Compensation (We went into this in depth in this article, so we don’t go into it again here. Read more about our coach compensation model here.

 

Coach Development/Mentorship

Coaches are more likely to become full-time, career coaches, who are invested in their clients' progress, generate revenue for the business and earn a professional wage when they:

 

Go through a two to three-year educational program—one that includes real one-on-one mentorship, technical training, sales training and personal development, and earn their stripes the same way a business owner does: By building their own book of clients from the ground up (They start by shadowing clients and eventually can san 50% of the revenue they generate. See coach compensation article for more).

 

MadLab Group coaches go through a program such as the latter, which creates educated, self-sufficient entrepreneurs, who understand business and who stick around to pursue a career at your facility. We are not saying it’s easy, but the end game works for everyone

 

Coach Co-Op and Hybrid Gym Model

On the other side of the 6-week challenge, group exercise fitness business model, you have personal training studios. Personal trainers are able to charge their clients more money than group exercise facilities, and are able to earn a decent living; however, (as I already mentioned) they become crippled by the sheer number of hours they need to work in order to earn that living. If you have coached 40 on-floor hours each week, you know how exhausting it can be, and puts you on a quick path to burning out.

 

Our Hybrid gym model is a combination of group classes and personal training (All clients start with personal training and eventually do a combination of group classes and personal training).

 

In short, teams of morning and evening coaches pool their clients together for group classes, sharing the coaching workload and other responsibilities—such as scheduling, programming, billing, blogging, and social media—among them. Established coaches average just 6 group classes per week and 10-20 personal training hours depending on the week. In this system, they’re able to take home $5,000 to $10,000 a month working 20-25 on-floor hours (as well as another 10-15 hours on admin, client management, social media, continued education etc…).

 

In this system, coaches are more likely to save the business money by avoiding middle management and waste, since they’re responsible for variable costs, such as chalk whiteboard pens, cleaning (the business covers fixed costs—rent, hyrdo, heat). They’re more invested in the business as they have the freedom to come up with their own schedules, policies, ideas, and creations. And they’re able to earn a professional wage doing what they love—helping their clients get and stay fit and healthy.

 

I’ll leave you with this food for thought:

 

6-week challenge versus professional coach for life: Which business are you in? You can’t be in both. This is essentially at the core of Madlab 101 - The fundamentals of Gymmin.