Planet Fitness: A Model for Credit Unions?
By Bo McDonald
Many credit unions tend to operate by myths from within the industry. Likewise, many credit union business and marketing plans are written and executed surrounding those same myths. I’m not pointing fingers, nor am I excluding myself from that broad statement. Too often we seal ourselves in the credit union box by attending educational sessions and conferences, with lectures and presentations from others within the industry. While knowledgeable about credit unions, you’re missing the boat by not looking to other industries for ideas.
Credit unions could learn a lot from the fitness business. More specifically the Connecticut based franchise Planet Fitness. It’s a gym successfully branded as the “anti-gym.” The one obstacle to many people joining a gym is embarrassment. If you’re as out of shape as I am, the last thing you want to do is roll yourself into a sweaty room full of muscle bound body builders. CEO Michael Grondahl co-founded Planet Fitness in 1992, branding it as the “anti-fitness” gym with inexpensive memberships.
Here are three lessons credit unions could learn from Planet Fitness:
- Don’t listen to “them”: We tend to follow the same marketing schedule for two reasons. Because “that’s the way we’ve always done it” and if our competitors are doing it, so should we. When do you see most gyms marketing? New Years right? They are under the assumption that most people have made a New Year’s resolution and will start working toward their new goals right away. Not Planet Fitness. According to an article in Inc. Magazine, the best month for Planet Fitness is March. It turns out most people procrastinate and don’t start their resolutions until then. In fact, according to that same article, sales in March are 10% higher than in January, which is their second best month of the year. Maybe it’s time to look at the numbers at your credit union, not the research that our decisions have been based on for the last decade or two. Recently, as part of a membership loyalty program we looked at the average payoff for auto loans. The credit union had been operating under the assumption that it was over 36 months. It turns out; members were paying off their loans in about 24 months. This altered their member loyalty program immensely, and resulted in being the first choice for those members when trading in a vehicle for a new one. This credit union had the best chance at getting the loan because they were there before the decision or just when the decision came to purchase a new car.