In this article you’ll learn the most critical metrics that companies in the Fitness Center Industry should track.

The article does not include metrics such as Profits and Sales that are critical to companies in all industries; rather the focus is on metrics more specific to the Fitness Center Industry.

By tracking your metrics, you will dramatically improve your business results.

Why? Because not only is the old saying “If you can’t measure it, you can’t improve it” true, but visibility into your metrics allows you to identify WHERE you can make the easiest and most impactful improvements.

For each metric, we will answer the following questions:

– What is the metric?

– How do you calculate this metric?

– Why is this metric important?

Let’s get started…

1. Leads

What is this metric?
This metric measures the number of people a fitness center reaches out to who show interest in joining the establishment.

Calculation: This metric is calculated by adding the total leads generated within a specified time period.

Why is this metric important?
This metric is important because it measures how well a fitness center is doing with marketing its business to potential members.

2. Conversion Rate

What is this metric?
This metric measures a fitness center’s ability to turn leads into members.

Calculation:
This metric is calculated by dividing the total number of new members by the total number of leads within a specific time period. The conversion rate can also be calculated by taking total number of leads that enroll for a trial or free membership and dividing by the total number of leads.

Why is this metric important?
Conversion rates are important for fitness centers to track because it can indicate how well a fitness center sales team is doing with marketing initiatives and which specific initiatives are gaining members.

3. Retention Rate

What is this metric?
This metric expresses the percentage of members who have stayed with a club within a certain period of time.

Calculation:
This metric is calculated by taking the total number of retained members at the end of a time period and dividing by the total memberships at a fitness center at the beginning of a specified time period, commonly measured during a 12 month time period.

Why is this metric important?
This metric is important because customer retention affects revenue and profit at a fitness center.

4. Average Length of Membership

What is this metric?
This metric measures the average amount of time a fitness center retains its members.

Calculation:
Average length of service can be calculated by taking the total number of members during a time period and dividing by the total number of months or weeks that those members were retained.

Why is this metric important?
If average length of membership is high, fitness center members are likely to be happy with the service at the center and continue their membership. If length of membership is low, this can be helpful for management to look into and understand why members are not continuing their membership.

5. Early Stage Usage

What is this metric?
This metric measures how often new members use their memberships during the initial months of signing on with a fitness center.

Calculation:

This metric is calculated by adding up the number of days a member attends the fitness center within the first 90 to 120 days of a new membership.

Why is this metric important?
This metric may be able to provide insights to fitness center management in regards to member retention. The more often a new member uses its membership within the first three months, the more likely they are to stay on as members of the club for a longer period of time.

6. Membership Usage

What is this metric?
This metric measures the frequency each member uses their fitness center/club membership.

Calculation:
This metric is calculated by dividing the total number of days a member attends the fitness center within a week, month, etc. by the total number of days in the time period.

Why is this metric important?
This metric is important for fitness centers to track because if members use a fitness center on a regular basis, they are more likely to continue their membership with the establishment. If member usage is low for specific members, the club can use this information to identify ways to get members to use their membership more frequently.

7. Customer Satisfaction

What is this metric?
This metric measures the level of satisfaction of fitness center members. Customer satisfaction surveys include questions about quality of service, availability of equipment and cleanliness.

Calculation:
This metric may be measured by conducting a formal satisfaction survey to understand the satisfaction level of fitness center members.

Why is this metric important?
Customer satisfaction is important because it provides actionable data on how fitness centers can improve their services. If customer satisfaction is high, centers may have an easier time retaining members. High customer satisfaction may also help bring in new members through current member referrals.

8. Gross Profit Margin

What is this metric?
This metric indicates the percent of sales the company makes after paying for costs to run a fitness center.

Calculation:
This metric may be calculated by taking a fitness center’s revenue less the direct costs of servicing its clients divided by the fitness center’s revenue.

Why is this metric important?
This number is important because it indicates to fitness center management the success of the business and whether the company is making a profit on services provided.

9. Additional Service Revenue per Member

What is this metric?
This metric measures additional revenue brought in from club members through services that are not included in membership fees. Additional services may include personal training, nutritional counseling, juice bars and spa services.

Calculation:
The metric is calculated by adding up additional service revenue that is brought in at a fitness center and dividing by the total number of fitness center members.

Why is this metric important?
This metric is important because non-membership fees are a big part of a fitness center’s revenue stream. This metric can also indicate how engaged members are at a fitness center, which may lead to customer retention.

10. Member Lifetime Value

What is this metric?
This metric measures the value a member is worth throughout the time they are enrolled at a fitness center.

Calculation:
This metric is calculated by adding up all member fees and payments a member will pay over a membership period.

Why is this metric important?
This metric is important because it helps a fitness center estimate how much they can spend on customer retention programs and advertising.