Health ROI - YMCA Trendsetters

My tenure in the fitness space tops 21 years this year. In all that time I've seen a lot of things come and go, including how we measure success. Although commercial, boutique, and private studios operate with different business models, they are all chasing three main metrics, new member acquisition, churn rate, and member retention.

I'll discuss each metric, the limitations of each and introduce you to a new way of looking at success, Health ROI. This way of looking at impact is bubbling up in YMCAs across the country who have leapfrogged the market in connected fitness technology. I hope to accelerate this trend because I love the Ys, and for deeply personal reasons.

Ultimately, none of the work I've done in my career will leave a life-changing legacy... before this. That's not to dismiss some of the meaningful work that I've participated in, but to be candid, none of my work boosting the traditional measures matters if we don't get one thing right.

Big Three Metrics

Of the big three, member acquisition, churn rate, and member retention, new member acquisition is the most clear cut.

New member acquisition measures how many new members were added to the bank draft each month. If it's positive it reflects strong marketing efforts. 

Member churn takes the new members, subtracts the members who canceled or termed to produce the 'churn rate'. A high churn rate indicates poor new member onboarding or member experience.

Member retention is much less cut and dry and of the three, is the most difficult to measure. Member retention is calculated in a variety of ways. Some people are looking at this as month over month churn, others are looking at it as a 13-month snapshot. Some methods involve simple math and other methods use sophisticated formulas that track the length of stay down to individual members.

Historically, the purpose of all three of these measures is to predict cash flow. The goal is to increase member acquisition, reduce churn, and therefore have a better member retention rate. Of the three, member retention is the most useful in predicting trends.

Why Member Retention is Flawed

On the most basic level, member retention is a complex set of variables interacting with each other to produce a retention percentage, either by calculating month or month retention or 13-month retention. 'Good' member retention numbers are usually 70% or better, which is nothing more than a 13-month comparison of how many members you have today vs 13 months ago.

The limitation is that this method doesn’t account for members coming and going during that time, the churn effect. In other words, you could have a member retention rate of 75%, with an average length of stay of 6 weeks. This short length of stay indicates (1) strong marketing efforts are driving member acquisition, and (2) a week post-sale member experience and/or onboarding process, (3) a high churn rate.

In this case, we would need the length of stay to identify the problem, which is incredibly complex to determine.

On the flip side, you could have an incredibly low retention rate, say closer to 60% with an average length of stay of 11 months. That indicates a (1) lower churn rate, (2) solid new member experience and/or onboarding process, (3) underperforming marketing strategy.

Again.. you need the length of stay measure to tease that out.

At the very least, careful evaluation of these measures is required to take action on them. Worst case, they are almost useless in showing anything but high-level trends. You have to be able to understand what's going on to manage change and length of stay is required to add context.

How to Measure Length of Stay

Length of stay measures how long a new member remains a paying member before they cancel their membership. Beyond giving context to member retention percentage, length of stay is also an important way to measure the impact of onboarding interventions.

Although length of stay is a far more useful way to look at member retention, tracking length of stay is VERY difficult for two reasons.

1. Individual Member Level. It has to be done at the individual member level, which is challenging with most MMS systems that look at membership in more of an aggregate perspective.
2. Data Matching. Reconciling which individual members received an onboarding intervention and then tracking their length of stay compared with members who did not is TEDIOUS and often has to be done almost manually or with a series of data scrubs and matching efforts.

Beyond the difficulties in measurement and reconciliation, it is also a slow-building indicator. Essentially you have to wait for members to cancel to gain insight. The more successful the intervention, the longer the wait.

As a result, when I used this indicator in member retention analysis efforts, I had to report it in terms of revenue lift for each additional month of membership in that process. It was the only way to account for members who hadn't yet canceled and had to be eliminated from the analysis.

Scope of Impact

Other than learning how hard it is to measure retention, we also learned through analysis of hundreds of YMCAs that onboarding interventions work... when appropriately designed.

We knew so much about behavioral change that I could tell any YMCA exactly what to do with a new member to improve their length of stay. If they could implement our recommendations, we could make members stay longer. Essentially, we cracked the code.

I'm not with that firm anymore for a few key reasons. There was a problem with the code. There were two key criteria that had to be met... every time, for the intervention to work. And there were problems with both.

Staff must deliver the onboarding intervention over several sessions. The intervention that was the most predictive of success was a series of sessions where the member receives health coaching, not just prescriptive exercise guidance.

1. Expertise. There isn’t an abundance of staff trained in behavioral coaching. Personal trainers tend to be more prescriptive and can sometimes be retrained, but not often. Behavioral or ‘health’ coaching requires training in motivational interviewing and excellent communication skills, which in this digital age are increasingly hard to find... especially in part-time staff. They also need to be able to design custom workouts which creates a rare combination of required skills.
2. Attendance. It drops off significantly after the first session but the most meaningful lift in length of stay happens after the third session. Unfortunately, less than 10% of members in an intervention completed three sessions. Out of your 15 people, only one or two would actually attend three sessions. 
3. Expense. The cost of delivering, training, and tracking this intervention was significant, even with supportive software and tools, which also came with a cost. 

Members have to accept the intervention. This is by far the most challenging.

1. Overall less than 30% of members will accept any form of free session. Whether your staff describe it as a ‘custom workout plan, Smart Start, Quick Start'. Out of 100 members, that's 30 that will schedule an appointment.
2. Less than 50% of scheduled or accepted sessions actually SHOW UP to that session. Now we're down to 15 members impacted out of 100.
3. There’s a strong selection bias in members who accept the intervention. A significant percentage of members who received the intervention were never at risk anyway. They are the type of members who recognize they need help, seek and accept help… that makes them inherently less at risk for cancellation anyway. Of 15 members, it would be reasonable to assume 10 or less were actually at risk or early termination.

Biggest Question we Don't Ask - Why do Members Fail?

Even if we could overcome all of those challenges and are ok with only impacting 10% of available members, it still doesn't address why members are failing to begin with. Although it might seem like an obvious question to ask a member, many members don’t report 'failure to achieve goals' as their reason for canceling even though it’s their real reason. Instead, they cite reasons like ‘lack of time’ or ‘not using’ as the reason.

Why? The story is better. Telling themselves the YMCA didn't work for me because, ‘my life is just too crazy right now, I just don’t have time to go to the gym’ is a far better story to tell yourself than, ‘I didn’t make exercise or my health a priority, I failed, again.’ 

Choosing ‘lack of time’ or ‘not using’ doesn’t indict the member for their lack of behavior adoption. It’s emotionally easier to blame something outside yourself. The majority of members cancel because they fail, no matter what they tell you.

Why Aren't we Tracking Member Success?

The true leading indicator for member retention is member success. Members who achieve success, whether it’s getting stronger, improving stamina, or losing weight... stay longer. Period. Anyone who studies member retention agrees on that point.

Why then is member success not a key metric?

Data protection. HIPPA compliance and data protection have been increasingly emphasized and make collecting and tracking data difficult. 

No objective measures. If we wanted to see strength gains, cardiovascular improvement, or muscle imbalance corrections… how, other than manual tests, could we capture pre and post-data?

We suck at it. The truth is, this is something that if we tracked it, we would be very disappointed with the results. The vast majority of new members are inexperienced 'health seekers'. Without intervention, they typically gravitate to low-intensity cardio, primarily because it's one of the few forms of exercise they know how to use. Low-intensity cardio produces very little results. After a few weeks, they can't talk themselves into prioritizing it over other more enjoyable activities.

Why 'Experiences' Outperform 'Interventions'

New member onboarding protocols are essentially interventions. Interventions, as traditionally described, are expensive, difficult to scale, and by their very definition seem unappealing to members... reducing the acceptance rate.

YMCAs who will succeed going forward are those that commit to investment in effective new member experiences that yield more independent member success.

Generally speaking, we need offerings that provide self-service experiences for members as easy as low-intensity cardio, but as effective as strength training. We need a pathway that members will default to, that's effective at driving results.

We need it delivered in an appealing way that new members can access, that doesn’t require a tremendous staff burden.

Lastly, we need assessment and progress reporting that’s early, personalized & ridiculously easy to understand. 

What could we assess? 

With the technology that's available today, we should be able to effortlessly assess basic data on incremental improvements. Without further technology developments, we can already track

1. Strength gains
2. Cardiovascular stamina
3. Muscle Imbalance correction
4. Flexibility
5. Metabolic Health

The simple fact is that we haven't pushed the vendors to aggregate data or cooperate in a meaningful way. That's resulted in tons of data available to members, through lots of disparate portals and logins.

Aggregating Data in Meaningful Ways

Some shifts in the market are fads, others are trends. Many fortunes have been made predicting which category a new product or solution falls in. Testing and assessment are well-established TRENDS. Today you can test everything from your glucose response to food, genetic factors impacting chronic disease, body fat, lean body mass... you name it, there’s a gadget that tests it.

The problem is, getting all that data in disparate forms is confusing, even for the biohacking enthusiasts who sparked the trend. What we've been lacking is a data aggregator, interpreter, and translator.

Until now.

Introducing - BioAge

EGYM’s BIOAGE is a perfect example of disparate data is rolled into a succinct, actionable, and wickedly sharable metric. How old is your body? How old was it yesterday?

Inside this one, brilliant metric is hundreds of data points, broken further down into metrics for your

1. Strength age
2. Cardiovascular age
3. Flexibility age
4. Metabolic age
5. Muscle Imbalance 

BIOAGE is a silhouette of a much more intricate picture. Its beauty lies in the simplicity. YMCAs around the county will offer members a simple metric that shows immediate, real-time improvements that are unseen in the mirror for weeks or months.

It can be based on a single measure if that’s the only data available, to paint a complete picture.

For example, the first time a member experiences our smart strength machines we calculate their strength BIOAGE. On the next visit the member may experience the simulated VO2 max test on a Precor, Matrix, or LifeFitness treadmill, and bam! We have their cardio BIOAGE. The member may work with a trainer at some point and get an Inbody or Seca body scan to assess your body fat, waist to hip ratio, and BMI. Now they have a metabolic BIOAGE. Eventually, everything rolls in together and the member gets a 360-degree measure of their health and progress.

BIOAGE has gone viral with members, sharing on social media, in the YMCA, competitions between staff and members. It's a brilliant way to motivate members and staff, but it's also a game-changer with donors and partners.

Reportable Health Outcomes

Imagine a world where a YMCA could correlate investment and giving to actual health outcomes? What if we could report the impact of a gift in terms of years lost off BIOAGE in a particular community?

A hospital partner gifts a YMCA with 200K. Part of that gift goes to a new member experience with connected strength, cardio and a cloud that connects hundreds of partner data sources. What does the report back to the hospital look like? 

Thank you Landmark hospital for your generous support of the Bay Area YMCA. In the first three months, your gift has helped improve the health of 3541 members. Of those members, a total of 56,656 years were lost on their BioAge helping them restore health and vitality to their life. Specifically, these members are 25,431 years younger in their cardiovascular age, 21,225 years younger in their strength age, and 10,501 years younger in metabolic age. We corrected over 5,400 serious muscle imbalances. 

We want to thank you for supporting the health of our community. For members like Tom, the impact was quite profound… 

From: Tom <[email protected]>

Sent: Friday, November 6, 2020 12:27 PM

To: Jennifer Thomas <[email protected]>

Subject: EGYM

Hi Jenn, I started doing EGYM three weeks ago and I’ve also been running on the treadmill 3 to 4 miles per run. Today I ran 5 miles outside and It felt like younger legs replaced mine!! It was amazing!! I was doing leg weights on traditional machines but again I am amazed at the difference!

Thx, Tom Collison

Sent from my iPhone

One Caveat - Final Word

As you read my ramblings about the 20+ years of experience in member retention, keep one thing in mind. Those that benefit most from trends are the trendsetters. Those that see the potential and jump early. After three years and 1000% growth in the YMCA market, other operators are taking notice. We've passed the early adopter phase and have proven the impact, interest is exploding.

While the YMCA mission aligns beautifully with this work, so do the financials for lots of other entrepreneurs. There's never been a better or more important time to spot a trend, lean in and own the narrative. I'm here, with my team and in this role to make sure YMCAs across the country have this opportunity for four reasons,

1. Right. Wellness and health are fundamental human rights, in my opinion.
2. Access. No one can provide that to everyone, regardless of socioeconomic status, better than the YMCA.
3. Effectiveness. We know our solution helps change the health of the most at-risk populations. This group made me fall in love with this industry and is still dear to my heart.
4. Proof. We can now report that change, in real numbers, real years... real lives.

I'm beating this drum as loudly as I can because I believe the YMCA brand is facing a defining moment, if not a divine opportunity to serve. Post pandemic, we should claim health as a fundamental human right, and as a movement, with our national network of delivery systems, we make it accessible to everyone, not just through access, but through thoughtful, beautiful design that reflects a perfect marriage between what we know of behavioral science and the highest utility of data.

I make a commitment to all of you, on my word, that this is an area where we need to lean in as vendors, YMCA community leaders, and influencers. The market is on your heels but you have first position. If the market takes over the solution will be expensive for members, because it works. Out of reach for the very people who need it most.

I want this in Nashville for my parents who are scared to go outside because of preventable chronic conditions. I want this for my dear friend in Gainesville who is struggling with diabetes and needs to lose weight but has no idea where to begin. I want this for your parents, siblings, aunts and uncles, friends, and family who are facing a new reality where your metabolic health is a life or death issue.