new york
CNN
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Planet Fitness’ $10/month membership plan is a powerful marketing tool and a central part of their strategy.But the biggest one is american gym chain is increasing its monthly rates for the first time in more than 20 years.
Starting this summer, Planet Fitness will increase the price of its “Classic” membership from $10 a month to $15 for new members. “Classic” membership gives users access to her one location. (Planet Fitness’ $25-a-month “Black Club” membership offers access to more locations and benefits.) Planet Fitness hasn’t increased this rate, but executives say the plan’s more says it may start testing higher prices).
Planet Fitness executives have not said why the chain is raising its master plan by 50% for the first time since 1998, but the move comes as rising interest rates and construction costs have slowed new gym openings. It’s movement. Planet Fitness has a simple gym with basic machines and no lockers, steam room or towels in his room to keep costs down. Rising costs threaten the company’s business model, known in the fitness industry as “high-volume low-price” or “HVLP,” even more than high-end gyms.
While companies across the country have increased their rates since the pandemic began in 2020, Planet Fitness’ $10 fee was one of the few that remained unchanged. brand synonym.
“This is a ‘get off the couch’ price,” says former Planet Fitness CEO told CNN In 2022.
Planet Fitness has long offered a $10 basic membership to people who are interested in working out but have never joined a gym before, are intimidated by fitness enthusiasts at other gyms, or are looking for a more expensive option. We have been recruiting people who cannot afford to join a club. (Gym membership fees in the U.S. typically cost about $50 a month, but high-end gyms and high-intensity classes can cost double or triple that amount.)
In a commercial, Planet Fitness touted its $10 gym plan, which includes an annual membership and free training. The company has long sponsored New Year’s Eve celebrations in Times Square to get people to consider signing up as a commitment. According to the company, 40% of new Planet Fitness members have never belonged to a gym before signing up.
Analysts said the $10 price was just the right price. It’s cheap enough to draw people who want to get in shape to Planet Fitness, and just as importantly, it’s not so expensive that people cancel if they don’t go often.
Planet Fitness then attempts to upsell these members by pushing them toward black card memberships. More expensive monthly plans offer access to all of Planet Fitness’ gyms and perks such as water massage beds, massage chairs, tanning equipment, and black card members can also bring visitors.
On a conference call Thursday, Sharon Zakfir, one of William Blair’s analysts, said that given that consumers are pressured by inflation and looking for cards, “it’s hard to accept a 50% price increase on classic cards. It seems like a strange time.” Good value.
But Planet Fitness executives said consumers are used to price increases and the move will not hurt business.
“We’ve seen people move prices across all industries,” said Craig Benson, interim CEO of Planet Fitness. “So changing prices that have been in effect for a long time shouldn’t be a shock to anyone.”
