Social Is a Key Part of 24 Hour Fitness' Lead Gen. Regimen
Peer-to-peer referrals produce healthy conversion rates.
Getting customers to refer brands can be a real work out for marketers. But as the old saying goes: No pain, no gain.
Marketers acquire more customers for their brands by enabling current patrons to brag about them in their preferred channels. Health club chain 24 Hour Fitness learned this lesson by implementing Gigya's consumer identity management platform for its social sharing referral program.
Like many gyms, 24 Hour Fitness had a traditional offline referral program, says Joe Beruta, head of marketing and communications for the health club chain. Staff would distribute printed three-day trial passes to existing gym members in hopes that they would share the offer with family and friends. However, relying on printed materials proved difficult, not to mention costly, and limited the brand's reach.
“As you're leaving the gym, you probably don't even have your wallet with you,” Beruta says. “Those print materials could get misplaced, lost, [or] forgotten about.”
As a result, 24 Hour Fitness decided to roll out Gigya's consumer identity management platform in March 2013. The platform would enable gym members to share trial passes via email or their social networks. But 24 Hour Fitness wanted to do more than just make it easier to share. The brand had three key goals, Beruta says: leverage the exponential power of social, drive efficiencies while cutting back on costs, and collect data from social platforms to produce more relevant communications.
Here's how it works: Existing gym members can share trial offers by visiting 24 Hour Fitness' online or in-club kiosk referral system and logging in directly through their social networks, such as Facebook, Pinterest, or Twitter. The trial offer is then posted on the existing member's page, as well as on the pages of the connections with whom the deal is shared, Beruta explains.
“You get much more exposure and impressions right out of the gate than you normally would any other way,” Beruta says. “And you do that at very reduced costs. So the efficiency is positive for our business.”
Not only do social log-ins expand the brand's reach, but they also provide 24 Hour Fitness with new sources of data. For instance, when members access their account via social log-in, the health club is granted access to that member's public profile information—such as name and email—says Victor White, director of marketing communications at Gigya. 24 Hour Fitness can also ask for permission to access additional data beyond public profile information. Gigya then takes this data and stores it in its identity storage data base, White says, so that it can append additional data when further activities take place, such as a customer commenting on a post. 24 Hour Fitness can also take this information and add it to data stored in its central database to deepen its understanding of a prospect or member.
In the case of a prospect, when a person interested in joining the fitness center walks in, 24 Hour Fitness asks them to fill out a form and provide their name, address, reason for visit, fitness interests, and desired amenities. Even if that person decides not to join the gym but is part of the social sharing program, 24 Hour Fitness can take the information from the prospect's visit and add it to her social sharing record to send more targeted communications.
As for members who prefer to share the trial offer via email, 24 Hour Fitness can check the email addresses of the recipients against its database to determine how many redeemed the pass. This allows the fitness center to send targeted pricing emails and promotional information based on where prospects are in the purchase cycle.
“The digital side of this [and] the social side of this really help us get in front of potential prospects or intenders that are looking to join a gym where we normally wouldn't have access to these people without doing heavy digital advertising campaigns with banners and the like,” Beruta says.
Within the first three months of launching its program, 24 Hour Fitness accumulated more than 331,500 direct contact referrals via the program—or about $3 million in online media value. In addition, the brand obtained more than 8,400 direct program referrals in January 2014—which resulted in more than $600,000 from new member units and lifetime value revenue.
Furthermore, 24 Hour Fitness was able to identify which social networks existing members were choosing to share their passes. Within nine months, the health club determined that its Facebook shares had decreased from 77.4 to 58.9% while its Pinterest shares rose from almost nonexistent to 11.2%.
“This also is a positive for us,” Beruta says, “because from a digital advertising strategy, we want to go where the people go and where people are interested to help [them] find fitness and wellness.”
Although 24 Hour Fitness' program has remained fairly similar to its original debut, the company intends to experiment with gamification to play off the competitive nature of a gym, Beruta says. He adds that the fitness club leveraged Gigya's influencer reporting capabilities to identify which customers referred their friends and family the most and reward them for doing so, with perks such as free merchandise.
“Generally speaking, not all users are created equal,” White says. “Some are more responsive [and] some are more influential than others. It's important to be able to identify which ones are creating the most value for your business and simply say thank you to them.”
However, Beruta says that it's important for marketers to be transparent about their use of social data to prevent their pasts from deterring marketers' futures.
"There is a consumer base across the country that has skepticism about their data," Beruta says. "From a marketing perspective there's a lot of opportunity to do this in the right way, permission-based, that can benefit the company and not compromise consumers' information. [Marketers] have some work to do because there's been a variety of challenges in the marketplace with a variety of different brands that have made that more challenging today than it used to be."