Posted by: Sales Makers | July 20, 2017

Addendum to X-Selling at Membership Sales Page 5

The major disruption to the Industry came about in late 1981 at a meeting in Sarasota, FL where the new Association IRSA was created. I found out about it because my business partner gave a presentation to the group, he was in the bar and I worked with the first President of IRSA and we were one of the first clubs in the US to also go down this path.

The path I’m writing about is of course:         Monthly dues… allowing customers to pay for their memberships on a monthly basis via EFT (Electronic Funds Transfer – also referred to as Direct Debit, Autogiro, etc.)

I’ve written extensively in X-Selling at Membership Sales about the conversation in the bar and the outcome. So, I’m not going to repeat myself here.

The United States and the banking Industry was changing and consumers were actually being encouraged (read: forced) to use this type of payment option. The consumers however were a bit confused, didn’t trust this new system, thought people were going to have access to their money and generally hesitant. Our biggest problem was educating the consumers that their reluctance was miss-guided and so we also gave them the ability to pay annually (the way they were accustomed) and even save money.

This resulted in only 35% of the customers taking this new option.

In hindsight this was good, because the Clubs, as a business couldn’t really afford to take the loss of income so drastic (even though they were now selling more memberships – it wasn’t enough.) Fortunately, a lot of the big players and societal pressure was on our side. BMW came up with this leasing idea and all the Yuppies wanted to drive the new 320i, but couldn’t afford to buy it – so they leased it. Clubs capitalised on this by introducing the Enrolment Fee and month dues (Initial down-payment and ongoing payments, like a lease for memberships).

This led to the majority of Clubs in North America following this type of payment scheme and led to the Golden years in America for the spurt in growth of Clubs.

On the International side, they didn’t have the same scenario and were left to develop their own form of membership payment options.

Some of the European Club Owners started attending the new IRSA Conventions and a show called Club Industry, while their staff were attending IDEA and other exercise shows and taking the information back to their clubs. This did result in some very odd types of logic that actually had the opposite effect. (Like: thinking that if you charged the same price for an Enrolment Fee as the cumulative monthly dues – you’d double your income per member.)                                                                                                                        [An actual situation I encountered in one client in the UK.]

Because we were involved in this early days, we made just about every mistake you could make and were able to learn from them – which quickly positioned Sales Makers a leader in the Industry and was the beginning of a very good few years in America. We were the conversion experts and this experience left me with some great information that I would use later in Europe – trying to figure out how to get the same results in a much faster timeline.  That positioned me quickly in the same role in Scandinavia and the UK especially, the go-to expert.


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