Physical fitness is no longer an option but a necessity for people to lead a healthy life. If you're running a gym, tracking key performance indicators (KPIs) is crucial to the overall success of your business.

• Customer retention rate is the first KPI you need to focus on. This metric determines how well you can hold onto your existing customers. The longer you retain your customers, the more revenue you'll generate in the long run.
• Average monthly gym attendance per member plays a crucial role in determining how well your members are engaging in your gym. It also shows how well your facilities and equipment are utilized.

Keeping track of such metrics helps you to understand areas where you need to improve, allowing your gym to grow and succeed. And while there are several KPIs to follow, these core KPIs are crucial in determining your gym's progress. Scroll down to learn about the remaining KPIs that will drive your gym's growth and help you stay ahead of your competitors!

## Customer Retention Rate

In order to maintain a healthy and profitable gym, you need to retain customers. One of the most important Key Performance Indicators (KPIs) that directly impacts customer retention is the Customer Retention Rate (CRR).

### Definition

The Customer Retention Rate measures the percentage of customers that you retain over a specific time period. It tells you how many of your customers return to your gym, which is important when calculating Customer Lifetime Value (CLV).

### Use Case

CRR is a valuable metric because it can help you understand which areas of your business you need to improve to retain customers. By tracking CRR over time, you can determine the effectiveness of your customer retention strategies.

### How To Calculate KPI

The formula for calculating CRR is:

CRR = ((E-N)/S) x 100

Where E is the number of customers at the end of the time period, N is the number of customers acquired during that period, and S is the number of customers at the start of the period.

### Calculation Example

Let's say you started the month with 500 gym members, acquired 100 new members during the month, and ended the month with 550 members. You can calculate the CRR for the month as follows: CRR = ((550-100)/500) x 100 = 90%

• Helps you understand customer satisfaction and loyalty
• Enables you to identify areas where you could improve to retain customers
• Provides a basis for setting customer retention goals

• Does not tell you why customers are leaving
• Only considers customers who actually left the gym, not those who are considering leaving
• Different industries and business models will have different industry benchmarks for CRR, making it difficult to compare across industries

### KPI Industry Benchmarks for CRR

Benchmarks for CRR will vary depending on the industry, business model, and geographical location of the gym. However, according to data from the fitness industry, a good CRR benchmark for gyms is above 80%.

#### Tips & Tricks:

• Provide excellent customer service to ensure that your customers feel valued and cared for
• Create a sense of community among your customers by hosting social events and workout challenges

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## Average monthly gym attendance per member

Gyms and fitness centers are businesses that rely on attendance and recurring revenue. Measuring the average monthly gym attendance per member is a critical KPI for gym owners and operators. This metric provides a clear indication of client loyalty, gym engagement, and experience. Below, we will delve into the definition, use case, how to calculate the KPI, calculation examples, KPI advantages and disadvantages, and industry benchmarks for the KPI: Average monthly gym attendance per member.

### Definition

The average monthly gym attendance per member is a KPI that measures the average number of times a member visits a gym over a month. This metric provides insight into how often a member uses gym facilities and takes part in workouts, classes, or other activities offered by the gym.

### Use Case

The average monthly gym attendance per member KPI helps gym owners and operators identify areas of member satisfaction and engagement, enhance gym offerings, and develop marketing and retention strategies. This metric can be used to identify trends in attendance, member retention, peak usage periods, and membership types of members attending the gym.

### How To Calculate KPI

The formula to calculate average monthly gym attendance per member is as follows:

Average monthly gym attendance per member = Total monthly gym attendance / Total number of gym members

### Calculation Example

For example, suppose a gym has 500 members and the total monthly attendance for the gym is 10,000. In that case, the average monthly gym attendance per member would be:

Average monthly gym attendance per member = 10,000 / 500

Average monthly gym attendance per member = 20

• The average monthly gym attendance per member KPI can help identify loyal members and assist gyms in designing appropriate retention strategies.
• It helps assess the demand of gym facilities and peak usage periods to manage capacity.
• This KPI can identify member preferences and trends, helping gym owners develop customized workout plans, gym offerings, and marketing strategies.

• This metric may be influenced by seasonality, holidays, or other factors affecting attendance, causing fluctuations in data.
• Membership cancellations, freezes, or pauses can affect data accuracy, leading to incorrect calculation of this KPI.
• Not all gym members use gym facilities equally, and some may only use specific equipment or attend particular classes, leading to biased data that can skew analysis.

### KPI Industry Benchmarks

The benchmark for average monthly gym attendance per member varies from country to country and depends on factors such as location, competition, gym facilities, membership types, and pricing. In the US, the industry average for this KPI is approximately 2 to 2.5 visits per week per gym member. However, gyms with high-quality facilities, a wide range of workout programs, and personalized services can achieve 3 or more visits per week per member.

#### Tips & Tricks:

• Create a membership level system with different perks and incentives, encouraging clients to increase their membership level based on engagement.
• Offer promotions for members to attend during low traffic hours, increasing their likelihood of attendance without overcrowding the gym.
• Consider offering virtual classes and personal training sessions to increase member convenience and encourage more regular attendance.

## Customer satisfaction score

As a gym owner, it’s essential to track the satisfaction of your customers to ensure they continue to choose your gym. The customer satisfaction score (CSS) is a KPI that measures the level of satisfaction a customer has with your gym and its services.

### Definition

CSS is a KPI that measures how satisfied your customers are with your gym’s services, personnel, and facilities. The score can be calculated through surveys, questionnaires, or feedback forms.

### Use Case

The CSS KPI can help your gym to improve its services and retain current customers by identifying areas for improvement. Knowing what your customers appreciate and dislike will help to tailor services better to their needs and expectations.

### How To Calculate KPI

The CSS KPI formula can be measured through surveys using the following formula:

(Number of satisfied customers/ Total number of customers) x 100

### Calculation Example

Suppose you conduct a survey from 100 customers, and the number of satisfied customers is 80. The CSS formula calculation will be like:

(80 / 100) x 100 = 80

Therefore, the CSS score for this period would be 80%.

• Provides insight into customer satisfaction and service quality.
• Helps to identify areas that need improvement in services.
• Assists in making better decisions for improving customer retention strategies.

• Outcomes can be subjective and dependent on the target audience.
• Low response rates to surveys can impact the data integrity and reliability.
• Data can be influenced by the respondent's mood and frame of mind during the survey.

### KPI Industry Benchmarks

#### Tips & Tricks:

• Consider keeping the survey questions brief and easy to understand to increase response rates.
• Regularly conduct surveys to track the level of satisfaction of your customers and compare between periods.
• Use customer feedback to improve your gym’s services and create tailored retention strategies.

## Percentage of members achieving their fitness goals

The percentage of members achieving their fitness goals is one of the essential KPIs that every gym owner should track. It is a crucial metric that shows the effectiveness of the gym's workout programs and trainers in helping members achieve their fitness goals.

### Definition

• The percentage of members achieving their fitness goals refers to the percentage of gym members who have achieved their fitness goals within a specified period.

### Use Case

• The percentage of members achieving their fitness goals KPI is useful for gym owners and managers who want to monitor the effectiveness of their workout programs and trainers.

### How To Calculate KPI

To calculate the percentage of members achieving their fitness goals, follow this formula:

(Number of members who achieved their fitness goals / Total number of members) x 100%

### Calculation Example

Suppose a gym has 500 members, and 350 of them achieve their fitness goals within a specified period. To calculate the percentage of members achieving their fitness goals, use the formula:

(350 / 500) x 100% = 70%

Therefore, the percentage of members achieving their fitness goals in this gym is 70%.

• The percentage of members achieving their fitness goals KPI helps gym owners and managers to evaluate the efficacy of their workout programs and trainers.
• It helps gym owners understand how satisfied their members are with the services provided.

• The percentage of members achieving their fitness goals KPI only measures the effectiveness of workout programs and trainers in helping members achieve their fitness goals and does not provide insights into other factors that may affect member loyalty.
• The metric may not reflect the experience of all members, as some people may have different fitness goals or may not be interested in achieving any respective goals.

### KPI Industry Benchmarks

• The average percentage of members achieving their fitness goals in the health and fitness industry is approximately 60%.
• The top 10% of fitness centers have an average percentage of members achieving their fitness goals of approximately 80%.

#### Tips & Tricks

• Benchmark your KPI results against the industry's competition to measure your gym's progress.
• If your gym's performance is below the industry average, it may indicate a poor quality of service provided by the trainers or the gym's programs.
• Add incentives for members who achieve their fitness goals, such as shoutouts on social media or a discount on their next membership fee.

## Revenue Per Member

Gym owners need to keep tabs on the revenue generated per member to understand their earning capacity and to find ways to improve profitability. Let’s take a more in-depth look at how you can track and calculate this KPI.

### Definition

Revenue per member is a simple metric that measures the average amount of revenue generated by each gym member. The KPI enables fitness business owners to keep track of their earnings on a per-member basis.

### Use Case

Tracking the revenue per member can help gym owners understand how much each member spends on average. This metric can further be used to improve client satisfaction by offering discounts or incentives to boost sales.

### How To Calculate KPI

Revenue per member = Total revenue / Total number of members

### Calculation Example

If a gym generates a total revenue of \$100,000 with 500 members, the revenue per member would be:

Revenue per member = \$100,000 / 500 = \$200

• Helps gym owners understand their earning capacity better.
• Enables fitness business owners to find ways to improve profitability.
• Boosts client satisfaction by offering discounts or incentives to improve sales.

• Does not take into account variations in membership plans.
• May not reflect the true value of a member who participates in personal training, classes, or other specialized programs.

### KPI Industry Benchmarks

According to industry reports, the average revenue per member for fitness clubs is approximately \$100-\$150 per month.

#### Tips & Tricks

• Try to limit discounts as much as possible as they tend to decrease revenue per member.
• Introduce special programs to increase revenue per member.
• Regularly survey members to understand what they want and offer personalized plans to increase their individual spend.

## Lifetime value of a customer

In the world of physical fitness gyms, it's important to understand the lifetime value of a customer because it helps gym owners make strategic decisions regarding their marketing and advertising budgets. Determining the lifetime value of a customer provides a deeper understanding of how much a gym can realistically afford to spend to acquire new customers.

### Definition

The lifetime value of a customer is the total revenue a customer will generate for a gym during the entirety of their relationship with the gym.

### Use Case

Gym owners can use this KPI to make informed decisions about how much to spend on customer acquisition and retention. By understanding the lifetime value of a customer, gym owners can allocate marketing and advertising budgets to maximize revenue while keeping customer acquisition and retention costs low.

### How To Calculate KPI

The formula for calculating lifetime value of a customer is:

Average Revenue per Customer x Average Customer Lifespan

### Calculation Example

For example, if the average revenue per customer for a gym is \$100 per month and the average customer stays with the gym for 24 months, the lifetime value of a customer would be:

\$100 x 24 = \$2,400

• Determines a realistic marketing and advertising budget
• Highlights the economic value of each customer relationship
• Allows for strategic decision-making regarding customer acquisition and retention

• Does not consider the variable costs associated with each customer
• Assumes all customers will purchase the same products or services at the same price points
• May not be accurate for new, inexperienced businesses with limited data

### KPI Industry Benchmarks for the KPI: ' Lifetime value of a customer '

The industry benchmark for lifetime value of a customer for physical fitness gyms is typically between \$1,000 to \$5,000.

#### Top Tips:

• Consider offering incentives for customer referrals to increase lifetime value of each customer
• Regularly analyzing and adjusting customer retention strategies can increase lifetime value of each customer
• Adopting technology solutions that improve customer experiences can increase the lifetime value of each customer

## Referral Rate

In the competitive world of fitness, referral rate is an essential KPI metric to track your gym's success in gaining new membership. It measures the percentage of new memberships generated by referrals from existing members within a given time.

### Definition

The referral rate is the percentage of new memberships generated from referrals. It is a metric that allows you to track how much business your gym is getting from word-of-mouth marketing.

### Use Case

A high referral rate implies customer satisfaction and trust in your gym, leading to a higher number of high-quality leads and reduced marketing costs. Tracking referral rate is paramount for maintaining a healthy membership base and gaining new members.

### How To Calculate KPI

To calculate the referral rate KPI, use the following formula:

Referral Rate = (New Memberships from Referrals / Total New Memberships) x 100

### Calculation Example

Suppose your gym gained 100 new memberships last month. Out of those, 30 came from referrals. Using the formula, we can calculate the referral rate:

Referral Rate = (30 / 100) x 100 = 30%

Therefore, your gym's referral rate is 30%, which means that 30% of new memberships came from referrals from existing members.

Referral rate is a cost-effective marketing tactic that generates high-quality leads. It helps in retaining existing members and attracts new ones, leading to a lower churn rate and higher revenue.

Referral rates can be easily manipulated to show a higher rate by offering incentives to members for referrals and thus skewing the data. Therefore, it is essential to ensure the validity of the data for an accurate analysis of the KPI.

### KPI Industry Benchmarks for Referral Rate

According to industry benchmarks, the referral rate for a gym should be around 30% to 40%. However, it varies based on regional demographics, gym size, and the target audience.

#### Tips & Tricks for Improving Referral Rate:

• Encourage satisfied members to refer their friends and family by giving them incentives.
• Implement a rewards program that offers discounts and other benefits to members who refer new members.
• Ensure that members are satisfied with your services to increase the chances of them referring others.

In an increasingly health-conscious world, physical fitness has become a necessary part of people's lives. Owning a gym necessitates tracking KPIs, or key performance indicators, to ensure the success of your business.

• To begin with, the customer retention rate is critical. This metric measures how well you can retain your existing customers and generate more revenue over time.
• In addition, the average monthly gym attendance per member is vital for understanding how engaged your members are and how efficiently your facilities and equipment are utilized.

Tracking these and other essential KPIs can help you pinpoint areas that require improvement, allowing your gym to thrive and prosper. While there are many KPIs to monitor, focusing on these core ones is crucial for tracking your gym's progress and staying ahead of the competition.

• The customer satisfaction score must be monitored to ensure that your customers are satisfied with your gym's services and facilities. This metric can identify areas where your gym can improve its overall experience.
• The percentage of members achieving their fitness goals is an important indicator of how effective your gym's workouts and training programs are. By providing members with programs that guarantee success, you can cultivate loyalty and retain them for longer.
• The revenue per member will provide you with the financial information you require to track your business's financial health. By understanding how much revenue each member is generating, you can improve your gym's financial performance and increase your ROI.
• The lifetime value of a customer is the total sum you expect a customer to spend on memberships at your gym over their lifetime. This metric allows you to understand how much a customer is worth to your gym and how to maximize that value.
• The referral rate is critical for driving new business and expanding your gym's membership base. By tracking referrals and incentivizing your members to refer friends and family to your gym, you can significantly improve your business's growth prospects.

By monitoring these KPIs and using the data to alter your gym's strategy, you can ensure growth and success for your business in the long run.

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