Which came first, Retention or Referral?

Getting new member referrals is the holy grail of marketing; you’re turning your members into one-person marketing operations. So should referrals come before retention? Or do you need to improve gym retention to generate referrals? We investigate.

Referral marketing is extremely powerful. People frequently talk about products and services that they get value from, and the gym is no exception. The vast majority of consumers trust recommendations from word of mouth. In fact, people are 4 times more likely to buy goods referred to them by a friend, according to Nielsen. And when it comes to social media, people are more likely to buy based on posts from friends and family than they are from brand accounts.

Mark Zuckerberg is someone who knows a thing or two about the power of leveraging human relationships to create loyal consumers. Here’s his take on the importance of referral marketing:

“People influence people. Nothing influences people more than a recommendation from a trusted friend. A trusted referral influences people more than the best broadcast message. A trusted referral is the holy grail of advertising.”

Which came first, membership referral or gym retention?

You’re not going to be able to get referrals out of people if they themselves don’t stick with your gym.

But on the other hand, it’s only through getting referrals from trusted sources and having a social reason to stick with a gym that you are going to get the most out of your customer retention strategies.

So in many ways, member retention and referral go hand in hand. 

But it is worth understanding that there is a cyclical relationship between referral and gym retention.

To get more referrals you need to improve gym retention… and in the process of getting more referrals, you will make it easier to retain your members.

So to get a referral you need to make sure your gym members are active and engaged and that their experience is a positive one. In a word, you have to increase the chances they’ll stick with your gym.

So how do you get referrals to your gym?

Well, first of all, your members need to have an exceptional experience at your gym. You can give them this by…

• Having a strong onboarding process so members hit the ground running when they join your gym and are predisposed to stick around.

• Building relationships with your gym members to make them feel connected to your gym.

• Using customer retention software to reach out to at-risk members and identify potential gym “promoters”.

Using Net Promoter Scores to get more gym membership referrals

One of the major advantages of using AI membership retention software is that you can tap into the power of Net Promoter Scores (NPS).

NPS scores are a customer loyalty metric that is used across many different industries. The scores are worked out by asking people how likely they are to recommend a brand to a friend or colleague by giving a score out of 10.

Net Promoter Scores identify whether customers have a positive or negative sentiment towards your products and services, categorising customers as either ‘detractors’ (unhappy, will actively discourage people), ‘passives’ (relatively happy, but might leave for other brands), or ‘promoters’ (have a great experience, will recommend to friends and family).

Gym retention software helps you track people based on their NPS scores. This means you can reach out to ‘promoters’ to get them involved in your referral program. You can motivate them to get involved by offering them referral rewards. 

Retention is the secret to getting more membership referrals

Whilst there is a circular relationship between customer retention and referral, having an effective membership retention strategy is the necessary foundation on which to build a referral programme.

The first step to creating a solid member retention strategy is to make your gym an experience people will want to tell their friends about. This will mean going above and beyond the typical gym experience. 

What are the elements of an effective member retention strategy?

Let’s take a look at what makes people want to stay with your gym.

• Provide your members with an exceptional customer experience. Understanding how to execute customer relationship management is an important part of this.

• Stay in touch with your members on a regular basis, sending them customised messaging.

• Encourage people to sign up for group activities, which is a surefire way to boost retention.

• Use automated gym retention software to track member data to help keep your retention strategy firing on all cylinders.

Once you have this foundation of member retention, it’s time to focus on the most engaged and loyal customers and encourage them to actively spread the word to friends and family.

This will result in glowing referrals far more powerful than anything dreamt up by your marketing team alone.

All customer retention strategies are greatly improved by the use of AI retention software like KeepMe, which is fully customisable to boost retention for your gym brand.

To find out how this software can solve your unique retention needs, you can book a free demo of our software today.