ClassPass launched several years ago and quickly swept through major cities, offering people the chance to sign up for unlimited classes across multiple studios. There were a few caveats:
- The app allows sign-ups on a first come, first serve basis, meaning popular classes fill up quickly.
- There is a charge for any classes that the member failed to show up for without advance cancellation.
- A maximum number of three classes per month are allowed at any gym or studio.
One year in, more than 400 studios in the Los Angeles area alone had signed up, with other large cities, such as New York, Boston, and Chicago, following suit. Of the whopping 350,000 class reservations, many were at boutique gyms that charge a hefty drop-in rate for in demand classes, including yoga, Pilates, spinning, CrossFit, Barre, and more.
Is ClassPass right for your gym?
The answer is “it depends.” While many gym owners jumped at the chance to bring in new potential customers with the goal of upselling them to a dedicated membership, other small studios found that their loyal clientele were unhappy with the way the system was working.
ClassPass makes undisclosed deals with each venue, but reports say the average payout to the gym or studio is a mere 40% of the drop-in class rate. With classes ranging in price from $10 up to $45 or more, the amount for each ClassPass member attending a class is far less than other participants. On the other hand, it can fill empty slots and is “more than zero,” according to several gym owners.
Or wrong?
Other boutique studios have refused to be part of the rapidly expanding ClassPass family. Some of the common concerns include upsetting the regular members as classes fill up more quickly and facing resentment from those who find themselves paying significantly more for their class than the ClassPass member beside them.
Does this sound familiar?
In the end, it comes down to the individual studio and the ability to accurately pin down how many empty seats are likely to be going without regular takers or higher paying drop-ins on any given day. ClassPass really only works in the studio’s favor when:
- The owner is able to accurately pinpoint how many ClassPass openings to allow in each class to avoid pushing out higher-paying regulars or drop-ins.
- A new studio opens or a new class is launched and response is low to start.
- Classes that are typically unfilled (usually less popular workouts or odd times of day) need extra bodies.
- The overall gym pricing is low enough that regulars don’t discontinue membership and join ClassPass, but high enough to make the 40% worth it.
Gyms can benefit most from ClassPass if they offer extra perks to regular members. This not only makes them feel like they are getting enough for the extra money they pay for their elite membership over and above what ClassPass members can access. In turn, these benefits also give ClassPass newbies a reason to become regular clients.
Should you make the switch in your business model and join the ClassPass train? That depends on how beneficial you feel it will be. There isn’t one right answer since all gyms are unique. Remember, there may be additional risks with inexperienced members trying classes they aren’t ready for, so be prepared by ensuring your fitness trainer insurance is up-to-date and your facilities meet all necessary codes for safety.
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