Know Your ROI

ROI, Return On Investment, is a measure of success. Did what you put into something produce a profit or benefit, and if so, how much? Was it worth it? More often than not, when we are talking about ROI, we’re talking about money and profit. However, it could also mean time and effort put into a project. The point of looking at the ROI is to determine if it makes sense to do it again.

Businessman drawing ROI (return on investment)

As an example, let’s look at running an advertisement in a local magazine. Say the ad cost you $650 and will run for a month. First, how are you going to know if it worked? You should always ask new clients/members how they heard about you. This is your effectiveness tracker. From this ad, you get only one new client. Was it worth it? Before you get all “What? I placed this ad and only got one new client??? That’s not worth it.”, think about what one new client is worth. If a client trains with you once a week (staying somewhat conservative) for a year and you charge $65/session, that means that just for that first year that client is worth (let’s see… $65 x 52 weeks = $3380) $3380. What was the ROI on that ad? One way to figure that out is to subtract the investment (or cost) from the gross income which gives you your net income or profit. Then divide the net income by the cost, in this case $3380 – $650 = $2730 divided by $650 which + 4.2 or 420% ROI. This, at least in my books, is a worthwhile investment.

jack-of-all-tradesThat was a straight financial example. Sometimes your investment is your time in putting together or creating a project or program. Because I’m good at a lot of things (you know, jack of all trades, master of.. well, a couple) this is where I often find myself. I could do it myself, but… is that where my time best spent? To find the ROI on a project or program you need to look at the cost of spending your (or someone else’s) time compared to what kind of return you will get. If a project is going to take you 10 hours and your hourly rate is $65, that’s a $650 investment. Estimate what you believe your return will be and then calculate the ROI for the project. Is it worth you spending your time to do it? Could you get a better ROI by having someone else do the work? This is an important exercise to go through.

Now, of course, not everything has to have a profit to be worth undertaking. Maybe you spend time or money on something where the only return will be the self-satisfaction of having done something good for someone else. This can include hosting or supporting some benefit event. Here, you simply need to ask, “Can I afford to do it?” and “Is it important enough to me, for me to invest in it?”

Understanding the ROI on your investments is crucial to building and maintaining a healthy business. Make sure you track the successes and, yes, failures by looking at the ROI of your efforts.

Are You an Imposter?

The real question I want to ask is, do you feel like an imposter? Imposter syndrome is a feeling, despite finding success and/or respect from others, that you are somehow fooling them and that one of these days they’re going to find out that you’re not that smart, or gifted, or talented. It often occurs when someone is brought up with the pressure of achieving excellence, whether that is in academics, sports, art or whatever. This pressure impostermay have come from parents, teachers, coaches, or can even be self-imposed. It’s also that the individual knows that there is still so much more they could know. As Einstein said, “The more I learn, the more I realize how much I don’t know.” (Unfortunately, those who think they know it all, don’t suffer from imposter syndrome.) It is also associated with those that are perfectionists, people who are always seeking to be better/do better. The syndrome creates anxiety in the person experiencing it which can hold them back from achieving even more (not to mention how constant anxiety can be detrimental to your health).

Let me be frank with you (arrgh, see, already an imposter)… Let me be Mark with you. 😉 Seriously, though, I’ve felt like an imposter off and on throughout my life. One example that stands out in my mind is when I served on a national personal trainer exam committee and, while I am very knowledgable in many areas of our industry, much of what I know has been self-taught. I only hold a BS in physical education/kinesiology, whereas my peers on this committee held either a MS or a PhD. I would always work extra hard to prove to myself that I earned my place on the committee. I know that not having my Masters degree has always made me feel a little sub-standard when I compare myself to my peers. I also continually ask myself, with so much to know, how can I possibly know enough?”

The imposter syndrome is not a rational feeling. Most of those that are effected by this have worked very hard to get to where they are and, more often than not, are well deserving of their achievements and acclaim. Celebrated author, poet, activist, Maya Angelou once said: “I have written eleven books, but each time I think, ‘uh oh, they’re going to find out now. I’ve run a game on everybody, and they’re going to find me out.”imposter2

So, how do we overcome feeling like an imposter? Here are some possible ideas on it.

  1. Own your success. Even those people who did get a “lucky” break worked hard to put themselves in the position to be available for that opportunity. Tell yourself that you deserve your success. You don’t have to repeat daily affirmations like Stuart Smalley, “I’m Good Enough, I’m Smart Enough, and Doggone It, People Like Me!” (unless, of course, that helps), but know that you have done the work to bring yourself to where you are.
  2. Stop comparing yourself to others. Often, when we compare, we look at our weaknesses compared to others’ strengths. Not fair. *side note, did you know that the top colleges have high drop out rates. That’s because, even though everyone has to be exceptional just to get in, the smart people are comparing themselves to the super smart people and then feel inferior, like they don’t belong there.
  3. Let go of the perfectionism. Maybe you don’t have all of the answers. You don’t need to. Ask yourself instead, do you have enough to deliver value?
  4. Continue to put yourself out there and accept new challenges. Realize that very few people are as driven as you can be, which means that you have the capacity to make someone’s world (or maybe the world) a better place. Keep on keeping on.

Some of the most successful people in every field have suffered from imposter syndrome, so you are in good company. But, you have to learn to overcome that self-doubt if want to enjoy your success (and life) more.

 

Create a Business Referral Network

A huge part of building your business is getting referrals from your existing clients and/or members. Referrals don’t stop there, though. You should be creating a network of other professionals that you can refer your clients to.

referral boardThe reasons for this are twofold. First, when you refer a client to another professional that can further enhance your client’s health and/or wellness, they get even better results and will appreciate you all the more.

Second, when another professional receives a referral from you, they will feel compelled to reciprocate (as long as you are good at what you do). These professional referrals are a low-cost way to get qualified (someone that’s already interested) leads.

Start by finding other professionals that don’t offer what you do, but complement it. Look for them in the areas of health (medical doctors, physical therapists), fitness (maybe yoga or a swim coach), nutrition (RDs, personal chefs), bodywork (chiropractors, massage therapists), beauty (hair, nails), etc. Meet with them and explain what you do and that you are looking for other professionals that you can refer your clients to. Ask about their qualifications, philosophies, and references to make sure you feel confident in referring to them.

Refer your clients when appropriate and review their experience afterward. Their experience will either support your use of this professional or let you know to look for someone else. The right professional referral network will benefit everyone involved.

 

Be Slump Proof: Never Stop Prospecting

If you’ve been a personal trainer for more than a couple of years, you have experienced a slump. These are those times when everything seemed to be going ok. Your schedule was full and life was beautiful. Then, all of a sudden, that couple that you were training 3 times per week (each) move out of town, another client gets injured doing yard work, and still another finds they can’t afford to train with you anymore. Now you find yourself with a third of your schedule open and feeling the financial pinch of making less money. Top that off with the fact that you can’t seem to pick up any new clients. You start to feel panicky and anxious. Life no longer seems beautiful. What happened?

Well, when you began as a personal trainer, you knew you had to hustle, talking to everyone, making connections, creating opportunities to sit down with potential clients and transitioning them into paying customers. This builds your schedule to the point where you are comfortable with the number of people you are helping and the money you are making. And guess what? You stop hustling. You sit back and go about your day-to-day training and everything is fine… until it’s not. 

The key is to never stop prospecting, never stop hustling. You know from having built your schedule the first time that gaining clients is not an overnight thing. It can take days, weeks, and sometimes months before a potential client decides it’s time to start.  That slump can last for months and that’s not fun. On the other hand, if you keep hustling, keep working it, what’s the worst that could happen? You could take on a few more clients than you had planned on, or maybe you pair them up with another client with similar goals (creating a small group), OR, you could pass these new clients on to another trainer, which helps more people, helps the other trainer, build good will, and keeps you in the game. 

Losing clients is inevitable. Having that loss send you into a slump, is not. Keep hustling and you’ll keep busy.

Patience and Hard Work: The Real Secrets to Success

I was just watching a video by business guru, Gary Vaynerchuk, about how patience and hard work are essential in reaching your goals. It reminded me about all of the young personal trainers I’ve known through the years that had great potential, but when their business didn’t build as quickly as they thought it would, they left the field for a guaranteed pay check (one in particular, with a degree in exercise science, went to work in a lumber store).  This, to me who has had a wonderful career spanning more than 37 years, is incredibly sad and it stems from some preconceived notion that success should somehow be quick and easy.

 

hard work

Why aren’t they prepared to put in the time and effort? Maybe it’s that see other personal trainers in the club doing well and believe that will just happen for them, or maybe they have seen some get rich scheme or system that is marketed to personal trainers. I may never know, but it’s just like we tell our clients, it doesn’t happen overnight. It takes time and consistent work to reach our goals.

Now, of course, the time and effort it takes needs to be well spent. Continue to learn, particularly marketing and sales. Then implement. Try different things, different ways of approaching potential clients, different ways of bundling services, different ways of asking for a commitment, etc. Then know that you will fail on some of these things and don’t fear it, embrace it. Every time you fail is a chance to learn, get better, and come that much closer to succeeding the next time.

Don’t be one of the “could have been” stories. Success will come to those willing to be patient and put in the work that it takes.

“Nothing in this world can take the place of persistence. Talent will not: nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not: the world is full of educated derelicts. Persistence and determination alone are omnipotent.” Calvin Coolidge

Should You Be Selling Sessions, Packages, Memberships or Programs? 

As you begin your business or as you reevaluate your business model, you may wonder what the best way is to present and sell your personal training. In the old days (I can say that because I’ve been personal training since the dawn of time.) personal training was sold as a single session or in small to medium sized packages that were increasingly discounted the more you bought. The idea behind selling discounted packages was that the client would see the savings in the larger packages, purchase those and would be committed for a longer period of time. Since then, a number of problems and potential solutions have come to light.

pricesProblem #1: Larger packages, even with their discounts, could run thousands of dollars. This could put them out of reach for those that really needed the financial discount.

Solution #1: I know some clubs that sold nothing less than a 24 session package, but they offered a payment plan for the amount. This made it accessible to those who couldn’t afford the larger sum up front and got that commitment for a longer period of time.

Problem #2: Personal trainers saw the discounting of packages as a discounting of the value of their service.

Solution #2: Choose one, consistent session price and offer bigger packages as a convenience and/or a commitment, not a money saver. This is not a very popular model as many feel it can lead to clients paying session by session and the fear is that the more often the client has to make a financial decision, the more opportunities they have to decide it isn’t worth it. We happen to offer the pay-as-you-go/session by session because a) it doesn’t devalue by discounting the sessions, b) is an easy financial commitment for more people, and c) I believe that if the skill, the service, and the results are there, the client would have no reason stop. (i.e. I had one client that paid session by session, 6 times/wk for 12 years)

Problem #3: With any session by session package, clients can be inconsistent. This leaves the personal trainer and/or club with an ever fluctuating, unpredictable income.

Solution #3: Clubs and studios are now offering “memberships” (monthly agreements) that are generally priced with a session/wk assumption. (i.e. Members pay $x/month for 2 personal training sessions/wk) What makes this more predictable is that it is a monthly fee that is most often set up as an automatic charge to the member’s credit card or bank account. There is the potential for a secondary problem in that if a client needs to cancel and you allow them to make it up, you can build a backlog of sessions that the trainer will “owe” the client. I knew one trainer that, because the member had a difficult time making up the sessions, ended up owing her client over 30 sessions. One way to handle this would be to allow the client to make up the session within a week or it would be otherwise be forfeited.

Problem #4: Finally, there are clients that only want to commit for a certain amount of time and want the maximum results for that time. This means they have to know the expected outcome, be held accountable, and maybe need more than just the exercise sessions to get those results.

8-week-fat-loss-program-for-busy-people-lose-weight-tone-up-build-lean-muscleSolution #4: The idea of creating goal specific small group programs (such as a preseason sports prep i.e. golf conditioning, a specific health concern focus i.e. healthy back program, or bundled offerings i.e. 2 small group training sessions + 1 nutritional coaching session each week), that have a defined start and end date can be a great alternative to other offerings. This could be a 4 week, 8 wk, 12 wk, etc. Do pre and post program assessments to gather data and then use that in setting program expectations, “In this program, the average participant achieved ….” This also assures the income, because clients sign up for the program, not individual sessions. I think the addition of various programs will be the biggest change in our industry in the near future.

These are not all of the issues and they are certainly not all of the possible solutions, but they are some of the most prevalent concerns. This post is meant to be food for thought. There is no wrong answer if your choice is working for you.

 

Presence; a Book Review

Presence: Bringing Your Boldest Self to Your Biggest Challenges by Amy Cuddy is probably classified as a self-help book, but it’s a lot more than that. In essence, social psychologist Cuddy, reveals the science behind creating personal power and presence and where and how that can be used in our lives. presense

A large part of that power and confidence can be controlled through our conscious attention to our body language. Cuddy discusses “power poses”, body positions that, when adopted, can leave us feeling empowered, confident and in the moment (present).

I’m sure that you, as do most of us, “read” people’s body language to gather insight into their personality. Hunched and averting direct eye contact may mean they are shy or wary. So, the emotional state creates the posture… unless it’s the other way around. Cuddy goes on to describe research that shows how changing your posture can also change how you feel, becoming happier, more open, more social.

I say that it’s a lot more than a self-help book because I can see how I can utilize some of the principles to help my clients. So many of the people we see have poor self images. If we can, through a few simple exercises, make others more confident and happier with themselves, wouldn’t that be a wonderful ability to have.

https://embed.ted.com/talks/amy_cuddy_your_body_language_shapes_who_you_are

If this interests you, I highly recommend reading Presence. As a teaser, check out Ann Cuddy’s TED talk on the topic.

KPIs and the 80/20 Rule

For those of you that aren’t familiar with the business acronym, KPI, it stands for Key Performance Indicators. These are the numbers that you can track that tell you how your business is doing. kpiAs a personal trainer, these numbers could be how many sessions you have per week, how many phone inquiries you had, of those, how many came in for an initial consultation, how many initial consultations you had, how many of those consultations became clients, the average dollar amount spent by each client each week, month, year, and so on. You can track almost anything, but should you?

80-20-rule_The 80/20 Rule, or the Pareto principle, originally referred to the fact that 80% of the population’s wealth was held by 20% of that population. The principle has since gone on to represent almost any situation where a smaller number represents the greatest percent of another. In business it might be that 80% of your business’s income comes from 20% of your customers, or that 80% of your referrals comes from 20% of your clients.

Back to KPIs. Of all the numbers that you can track, you want to focus on the roughly 20% of them that will have the greatest impact on the success of your business. Which ones are those…? That… is the big question, there is no one answer to that as it depends on any number of factors.

When you have an initial consultation or meeting with a potential client, what percent of those actually sign up with you (that’s your closing ratio KPI)? If you are really good at this, the fastest way to build your business may be to simply get more people to sit down for a consultation with you. Track where your consultations come from (another KP). Are they referrals? Did they come from a conversation you had with them in the club? outside of the club? from a public presentation that you did? If you got most of them (it doesn’t have to be 80%, BTW) from presentations that you do… do more presentations. Right? Rather than spending your time trying to improve everything, focus on the KPI that gives you the greatest return.

Say you have plenty of people sitting down with you, but your closing ratio is not good. Worrying about getting more people to meet with you is a waste of time. Your focus should be on getting better at closing in the consultation. This means, get help, study, learn and keep tracking you closing ratio. If you are not improving that, you may find that the best way to build your business is to deliver amazing service, but hire someone else that is really good at it to convert clients for you.

I’ve hardly touched on the number of KPIs that you could track. The key (pun intended) is to narrow them down to the 20% (or thereabouts) that have the greatest effect and work at improving those numbers. As management expert, Peter Drucker, has said, “What gets measure gets managed.” If you don’t measure the variables, you won’t know what actions to take.

 

Pre-suasion; a Book Review

Pre-Suasion: A Revolutionary Way to Influence and Persuade by Robert Cialdini, PhD is a fascinating book on the science of how, what people experience before a message, influences their receptiveness to that message.

presuasionWhat it presents, in essence, is the use of priming techniques to get the consumer (whether it is a product or consuming information) to respond in a in a particular, predictable way.

I found this book to be enlightening as to how individuals and societies can be influenced and how, if you look for them, you can see pre-suasive techniques being used in the world around you. In example, it explains those endlessly long landing pages that show success stories, show successful images, use success terms, etc. before asking you to sign up and if you’re not ready, they continue priming you before they ask again. You can even see how this came into play in last year’s election if you look at the different campaigns.

Cialdini says that the hope for the book is that its information is to be used for good and not evil (OK, maybe those are my words, but it is his sentiment). But, obviously, when you set out to influence people, it could be for your own personal benefit or for theirs (hopefully both).

This book is well worth your time and, if you are intrigued by this topic, I encourage you to read his other book , Influence: The Psychology of Persuasion. It’s another book based in behavioral science of how we can be and are influenced.

Is That Music I Hear?

There’s quite a bit of research that touts the benefits of working out with music. It can make the experience more enjoyable, easier, and people tend to work harder. Naturally we want these benefits for our clients and members. But, there may be some legal issues that you may not have considered.

I think we are all pretty aware that we can’t record an artist’s music and resell it. That would be piracy. That also applies to playing it for customers. Recently, I had a conversation with my ASCAP rep (The American Society of Composers, Authors and Publishers) and we discussed how they represent the artist and how any use of music of the artists that they represent, for the purpose of entertaining members, customers, or clients must also compensate the artist (even if you are simply playing a radio channel in the background). This is true for  fitness clubs and studios, as well as airlines, amusement parks, bars, restaurants & nightclubs, colleges & universities, concert presenters, music venues & clubs, convention & trade shows, hotels, local government entities, radio & television stations and networks, mobile entertainment, websites, retail stores and the list goes on.

ascaplogoWe, as business owners, compensate the artists by paying a licensing fee through their representative agency. ASCAP is one of those agencies and they have over 600,000 artists that they represent. But, they’re not the only agency in town. There’s also BMI (Broadcast Music, Inc) and SESAC (Society of European Stage Authors and Composers, although they now handle all types of music). bmi_logoYou are required to pay the appropriate licensing fees to cover all artists music that you play in your space. This amounts to about $300/year to each of these organizations. Now, you could hand select music to play at your facility that is all from one agency, but that’s pretty labor intensive. My recommendation is to pay each of them and cover your bases.sesac-logo185

If you want to use music for projects other than within your facility, such as an online or streaming video, these organizations offer separate licensing agreements for that type of music usage.

As much as we may have music as a part of our lives, free of charge (for us) on the radio, Pandora, at stores, the gym, etc, it was produced by artists. Like any product that has value, they should be compensated for that. It is our responsibility to pay the appropriate fees to them via their agencies. Think of the licensing fees as a thank you to the artists for sharing their creativity and talent.