CrossFit Moreland was an established fitness business based in busy Brunswick in Melbourne. CrossFit is a US based strength and conditioning system that has the reputation for being hard and intense but very rewarding to its participants. Over the last 4 years the owners had put in a enormous amount of money, effort and time but for a number of reasons overall membership was falling, the owner was exhausted and the business seemed to be heading for closure if something did not significantly change.

One of the Antebellum partners, who has a connection to the business was brought on-board to assist. The business had enormous potential and a large amount of money invested in its main asset, the “box” and its equipment. The business is fairly simple in its premise, it works on an ‘affiliate’ model which is very different than a franchise. Basically you pay a set amount per year to use the brand”CrossFit’, have to meet some criteria and then you are on your own. This combined with ongoing memberships is your business model and your customer base drives the vast percentage of your recurring revenue and each customer has a large annual value. But unlike most fitness models, CrossFit customers turn up to classes on average 3 – 5 times a week. So how do you fix it?

Antebellum firstly analysed the business, observed it operate, looked at the industry, the customer drivers and the revenue versus cost curves to see what needed to be done. The fact was the business has an exceptional core product, amazing facilities and great potential for growth so we decided to take it on as a client. Our plan broke the success down into 4 specific areas of action – attrition, sales processes, marketing and secondary revenue. To action these 4 areas we delved into the data and built detailed statistics models so we could see exactly what was driving what and what the trends were (or would need to be) over time. Before we started the action plan, we looked at the layout of the ‘box’ in detail, looked at the customer flow into and out of the facility, moved equipment and made parts inviting and less imposing to newer customers. And then we started!

1 .Attrition

Attrition, or customers leaving, was one of the key factors driving revenue loss. Recurring memberships were the main driver of revenue for the business so we needed to fix the attrition levels before we looked at the other areas of the business. There is no point trying to fill up the bucket if it is leaking out the bottom! This involved a multi-faceted approach on looking at what was driving the customers needs so we could define and establish a community, celebrate customers achievements and ensure they experience was the best for them. This involved establishing policies and actions, retraining the staff to execute these policies and behaviours and ensuring every decision revolved around meeting the customer needs, which included ‘Benchmark’ nights, clear opening and closing of classes and ensuring the celebration of any achievement no matter how small from the community as a whole.

2. Sales Processes

Once the bucket leaks were plugged we mapped out the sales process from initial contact to membership conversion (again supported by statistics) and completely systematised, scripted and retrained the staff for the entire sales process. We implemented surveys at multiple steps, integrated email systems, revised Introductory sessions and took an iterative approach with the staff on the ground to push the conversion rates to as high as possible. We rebuilt the Introductory sessions to ensure that customers felt as comfortable as possible with coaches waiting for their arrival, that everyone knew their name and we wrote and revised the scripts for the session based on new thinking and feedback from customers after every session.

3. Marketing

Only after ensuring both the attrition and sales process were the best they could be we worked on a simple and cost effective marketing strategy aimed at new customers and referrals from current customers (which is easier when your customers love your business). We systematised these into cycles across the year with again incremental improvements supported by statistics trends over time so we know what is working and what is not working.

4. Secondary Revenue

The final piece of the puzzle once the main revenue stream was optimised was to look at other ways to utilise the investment in the main asset. This included other uses of the space for personal coaching, seminars etc. We separated this from the main marketing stream as it is a different customer base and different use of the facilities.

The outcome for CrossFit Moreland over the 12 months Antebellum was involved was a 100% increase in membership with a 80% decline in the attrition rate and a 50% increase in conversion from initial contact to membership. In addition the sales and marketing systems are now systematised and templated. There is a cloud based customer management system in place that not only reduces costs through efficiency but also increases revenue as customers must have an active and paid account to use the facilities. We worked with the owners to reduce costs across multiple areas in addition to the nearly 120% increase in revenue, but probably the most important and rewarding result was the passion and happiness of the owners in seeing their business flourish with less effort and hundreds of very happy customers.