Private equity-backed Fitness Connection chooses 2River and the LIFT platform to improve retention and new member sales
2River really helped us better understand our members — who were most valuable and which posed the greatest risk of leaving. Our new system tells us the specific people we need to reach out to, when to reach out to them and how profitable they might be. By getting out ahead, we are retaining more members.
— Josh Harwood, Sr. Vice President of Operations, Fitness Connection
About Fitness Connection
In 2013 LNK Partners private equity partnered with management in a recapitalization of Fitness Connection as the company expanded in existing and new markets. Fitness Connection is a recognized leader in the fitness industry for its strong management team and its highly attractive consumer value proposition. Fitness Connection’s combines value pricing and no long-term contract obligation with a full range of amenities and services. The company currently has 28 locations in North Carolina, Texas, and Nevada, which typically range from 35,000 to 60,000 sqft.
Member retention rates in the fitness industry are typically low. Fitness Connection saw an opportunity to improve the customer experience and reduce the level of churn in its core business. They asked 2River to design and implement a retention and loyalty program that would develop and enhance customer relationships.
Why 2River and LIFT
Fitness Connection partnered with 2River starting in 2012 to to come up with strategies for increasing their members’ retention. 2River took a data-driven approach to diagnose the situation and to create a “short list” of testable strategies to help retain their members and increase spending per member.
Jeff Skeen, President and CEO Fitness Connection, reflected on 2River and the LIFT platform: “2River has profiled our members in a way that allows us to better understand attributes of a member that stays with us. 2River has provided us information to help us be more proactive in not only keeping the members we have but also giving us insight into what type of member we want to target based on criteria such as age and income.“
Using the LIFT platform the team analyzed millions of data elements from Fitness Connection’s membership and billing databases to identify why members were leaving and to pinpoint early signs that a member was likely to leave.
LIFT “cleaned” this data and built model of customer value and key attrition drivers. Within this model the team uncovered the 5% of members who accounted for over 25% of the monthly revenue.
LIFT provided segmentation and campaign management tools that allow marketing and sales to integrate predictive analytics with professional judgement. This allows marketing and sales to configure and control the algorithms to filter and prioritize leads and identify renewal or upsell opportunities.
Fitness Connection has seen improved retention of current customers and growth of new customers.
Fitness Connection’s marketing and sales leaders trust and understand retention campaigns because they combine analytics and their professional judgment. Their business units have gained a holistic understanding of and insights on their customers’ relationships across business lines, across products and services and across all channels.
Fitness Connection stores have improved lead and opportunity conversion rates, customer retention rates, and overall customer lifetime value.
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