Working Paper - Rrl on Client Retention on Fitness Center

Zillah Joanne P. Gallardo                                                   BA 2001 Business Research

1st year MBA                                                                   October 15, 2016

1. Introduction

The business of fitness is considered to be one of the most thriving and profitable industries in today’s times. This is mainly because of the society’s growing awareness and overwhelming responsiveness in living a healthy lifestyle. For most people, becoming fit is no longer a fad but a way of life so they spend their time, money and energy in going to fitness centers/gyms to exercise, get active and be healthier. Since fitness also offers great mental and social benefits, there has already been a remarkable demand on fitness services amongst all regions across the country. As the demand continually rises, this challenges the fitness owners/operators to adapt the customers’ changing views and expectations and view those changes as opportunities to uniquely improve and differentiate their services and facilities from the others.

Presently, there is a strong and wide competition brought by the emergence of fitness centers/gyms in the market. Such surge makes it increasingly difficult for the management of these fitness establishments, especially the new ones, to bolster their own competitiveness. As the competition continues to intensify, the need to sustain long-term relationships with clients has become a fundamental priority for fitness centers/gyms.

One of the primary concerns of fitness center/gym owners is Client Retention. Since helping clients achieve their fitness goals is the cornerstone of a fitness center/gym, the problem on client retention is a significant managerial issue. Hence, addressing such plays a critical role to the success of the business. For this reason, the research aims to answer the management problem on client retention approaches to be applied to establish, develop and foster ongoing client relationships.

1. Research Problems

1. What are the factors affecting client retention in a fitness center?
2. How can the factors influencing retention impact to the growth and success of a fitness center?
3. What are the customer retention programs or strategies that can be established by a fitness center owner in order to build long-lasting relationships with clients?

Related Literature

Health Crises in the Philippines

Health crises over the past few years have gradually invaded communities around the world. At the recent, Philippines is in a crisis of lifestyle-related non-communicable diseases^[1] as NCD-associated death incidents reached about 300,000 (Ronda, 2015). The upsurge was largely caused by tobacco use, harmful consumption of alcohol, unhealthy diet and physical inactivity (World Health Organization, 2015). Dumlao (2014) conveyed that amongst the eight major markets^[2] in the Asia-Pacific, Filipinos had the worst health habits and the highest history level of chronic illnesses. This is mostly attributed to Filipinos’ practice of sleeping less than the suggested hours per day, poor individual food choices and irregular and insufficient exercise. Also, a Healthy Living Index landmark survey (Philam Life, 2013) rated the Philippines a total of only 61 out of a possible 100 points—signifying appalling results in terms of overweight population and health satisfaction.