With the average monthly cost of health club memberships reaching $55, on average more than $39 worth of the membership goes to waste, each month! In a study of over 25,000 people in England by BMRB’s target group found that 67% of people who have gym memberships don’t use it at all!
In a study performed by Stefano Dellavigna an assistant professor of economics at the University of California at Berkely and and Ulrike Malmendier , an assistant professor of finance at Stanford they attempted to find out the reason why people buy health club memberships but don’t use them. They surmised that is because of consumer overconfidence. First people overestimate the number of times that they will go to the gym and then secondly they congratulate themselves by buying an expensive gym membership that rewards the frequent visitors with financial savings. This consumer overconfidence results in millions of dollars of profits for the health-clubs all the while reducing household income by hundreds of dollars a year.
This issue is so widespread that an article was published in the New York Times titled “How Much Does it Cost Not to go to the Gym?” In the article the author surmised that the fictional British Bridget Jones said it best: “Gym visits 0, number of gym visits so far this year 1, cost of gym membership per year 370 pounds.”
These health clubs profit when you don’t utilize your membership, in fact they need you to not show up because they have oversold the space in the gym. If everyone who had a gym membership showed up the gyms would create a mass chaos. There have been hundreds of articles written on the subject of gym membership contracts. Some gyms have even been investigated for their enforcement of their contracts. Essentially it is “buyer beware” and make sure that you read the fine print. Joining a gym is a legal contract that needs to be taken seriously. The only way to tip the scale in your favor is to use the membership that you have purchased.
Essentially they are going to get your money, yet if you don’t use the gym, they win!
*Two thirds of all personal training sessions are being conducted at the gym.
*It is projected by American Sports Data that by 2030 the number of older Americans is expected to double from 35 million to 70 million.
*Older Americans represent the largest growth opportunity for health-clubs. Over the past 15 years, the defining characteristic of industry change has been the growth in the population of older health club members. In 2004, there were 10.2 million members over the age of 55, an increase of 562% over 1987.
*The busiest month for new members happens to be January. *Women continue to represent the slight majority of overall health club membership, accounting for 52 percent 2004.