Fitness Business University Podcast

SPEAKER_00: What's up, guys?

Welcome to another episode of
the Business Secrets Podcast.

I'm going to start calling this
the podcast in the judo parking

lot because I've been, I think,
three, four weeks in a row now

of being consistent with
dropping Joey off of judo and

recording a podcast in here.

So I'm enjoying it.

A lot of cool stuff happening at
the time of record recording

this.

I am prep in deep prep mode for
the SPF mastermind meeting that

is coming from around the world.

Over a hundred gym owners coming
from around the world to my gym

in New Jersey.

We do two in New Jersey and then
one in Orlando, but this is the

second one in New Jersey.

And I've got a lot of great
stuff planned.

The event theme is all about
transitioning from operator to

owner.

There is a lot of gym owners
that are stuck working in their

business.

And you've heard the favorite
very famous Michael Gerber line

of a you really need to start
working more on your business

versus in your business.

I believe that's true.

There's a lot of stuff about the
e-myth that I used to believe

that don't believe anymore.

I do think the premise is really
good and is one of the most

valuable business books.

So I still recommend it.

But there's definitely some
things in there that I think

mislead people down the path.

But for whatever reason, I think
that shifting from operator to

owner is an important thing to
do.

Because if you never do, you're
always gonna kinda be chained to

the gym.

And you started the gym and you
took on all the risk and all the

pressure and all the stress to
have something in return.

And y yeah, money is good on a
it's fine, but I don't know, but

freedom's pretty good too.

And I do think there's a lot of
people that I think there's a

lot of people that don't have
money or freedom, but there's a

decent chunk of people that are
chained to the business and

making money, but have no
freedom.

And ideally you want both,
right?

You want your financial
situation to be really solid and

sound, but you also want to have
some freedom.

And I see a lot of business
owners that are doing well, and

there's a a salon I know of
where the guy's been working

there for 40 years and he's in
the chair, and he's still in the

chair, and he's still cutting
hair, still doing the same

thing.

Now he's probably made a lot of
money and done really well, but

he's been chained to the chair
and for a really long time.

And my wonder is if he wasn't
chained to the chair, what are

all the other opportunities that
he could be doing?

So if you take me, for example,
right, if I was chained to my

gym and I structured my life
around being at GFP all the

time, being there every day, and
I never did or thought of

anything else except going to
GFP and working at GFP, I

wouldn't be recording this
podcast, I wouldn't have written

any books, I wouldn't have
started a marketing agency, I

wouldn't have launched a
license.

There's a lot of other things I
wouldn't have done.

It wouldn't have launched this
business that I'm in, this

consulting business.

There's a lot of other things I
wouldn't have done.

And so that's whatever, but
there's a lot of people doing

it, and the theme of the meeting
is all about that transition.

And that transition is hard.

It's not an easy thing to do.

There's skills that you have to
learn that you necessarily don't

have.

And there's a mindset stuff that
comes with it.

There is a lot of mindset stuff.

There's a taught there's the I
often say growth and control

work inversely, right?

And if you want to grow and you
want more growth, you're gonna

have to give up some control.

And I think one of the reasons
why people stay the operator is

because it makes them have this
feeling of control.

But that tends to stymie growth,
right?

Yeah, it's uh it's a really it's
in it's a really important

topic.

And uh I when I see a
testimonial from a gym owner,

I'm I'm happy about the growth
and revenue, but I'm most happy

about the time that they're
spending with their families and

things like that.

So it's gonna be a great event.

Super excited for it.

I probably by the time you're
listening to this, it might be

over.

But today I want to talk to you
about one of my favorite books

is, and I rarely do this, but
I'm gonna do it because it was

such a good chapter.

So my favorite book on the
planet is The Road Less Stupid

by Keith Cunningham.

It's it's the book that I have
most highlighted, underlined,

dog-eared.

It's like my if you look at my
book, it looks like it's a

hundred years old.

It's just phenomenal.

And I was reading through one of
the because some of the stuff

I'm doing on systems
development, he has some really

good stuff on systems
development.

So I was brushing up on the
book, and I came across this

chapter that's been un more of a
forgotten chapter, I think, in

the book.

I haven't read it.

I've only read it a couple
times.

I've read the book like 10
times, but I've only read this

chapter a couple times, but this
just makes a lot of sense.

And he goes over a growth funnel
with how to grow your business

and what are the eight ways to
grow your business.

And I've talked a lot about the
Jay Abraham line of there's

three ways to grow a business
model, and that is get more

customers, increase the
transaction size, and then

increase the frequency of
transactions.

That's the Jay Abraham's.

This is like a little bit more
of a robust view of increasing

revenue.

Now, some of the stuff is it all
definitely contributes to

increasing revenue, but it's not
something that like necessarily

will stimulate revenue in this
immediate hit, if you will.

It's just things to do and
things to think about for your

business.

But it's a really good, I think
this is gonna be a really good

outline for what are the things
that you need to be focused on?

What are the areas of your
business that are the most

important to be able to grow
revenue?

And I had a business mentor, I
was in an off-site meeting, and

we were having this argument
over different goals that we

were gonna set, and he wanted me
to set five goals, I wanted to

set ten goals.

And he looks at me and goes,
Vince, when everything is

important, nothing is.

And so these things I'm gonna
outline with you, and again, I'm

straight from the book, right?

I got the book in front of me
going out and using it as an

outline, and then giving my
experience in color on each of

these items.

But I rare- I rarely do stuff
like this.

Most of the stuff that I teach
you guys is straight from the

trenches, it's stuff that I'm
doing at my gym, it's stuff I'm

seeing with my clients and stuff
I have experience with.

So I try not to tend to do too
much of what I'm about to do,

but I do promise to make sure
that the insights that I give on

each of the items is helpful.

So it's basically it goes in a
growth funnel, how a funnel

starts.

There's the top of the funnel
that's big.

And typically, what is when we
hear about a funnel, a marketing

funnel, what do you think about
our leads?

It starts with leads.

And actually, leads are the
bottom part of this funnel,

they're the smallest one, and
I'll talk about that when I get

to the end there.

So the widest part of the
funnel, he calls it, is keep

more customers.

And I'm in a hundred percent
agreement of this.

I think that, and again, I'm a
marketer at heart, I love

marketing, but in the gym space
where we have the ability to

have recurring revenue, where
when we get a customer, we can

either keep that customer for
twelve months, or we can keep

that customer for 36 months, for
50 months, for a hundred months.

You just think about the value
difference between a gym that

can keep customers for the
really the long haul, it is game

changer.

Complete game changer if you can
really do that really well.

And man, if there's if you were
to highlight one area of your

business to have your finger on
the pulse of, to have make sure

it's going well, to make sure
it's not getting out of hand, it

is 100% your attrition rate or
your retention rate, whatever

you want, whatever angle you
want to go.

It is 100%.

It is the lifeblood of the
business.

And it's funny, I've been doing
a lot of I've been doing

listening to this podcast called
the Founders Podcast, and I

really like this guy.

And he they were talking about
all the different big time CEOs,

like the guy from Walmart and
the guy from Home Depot, and

they were obsessed, they became
obsessed with the customer

experience, and to the point
where the CEO would be going and

flying in their private jet to
go to Walmart in Tulsa,

Oklahoma, and to go there and
talk to customers and be there

when customers come in and talk
to them.

And it was just like it's so
funny because I think the, and

I'm guilty of this too.

Like we get so far outside of
the result, right?

We want to not train anyone
anymore, but we forget about

that the training of the people
is the business.

Now, it doesn't mean we have to
do that, but it does mean we

need to keep our finger on the
pulse of that and make sure it's

good.

And I have made this mistake
myself.

I have had periods of time where
our attrition got a little bit

out of control because I totally
lost touch with the actual

product that we were delivering,
the people that were delivering

it.

And if you're owning your
business, like this is the

number one driver in your growth
funnel, is that you have a

really good attrition rate.

And no, you're not going to keep
everybody.

You're just not.

But at the end of the day, you
should be focusing on shoot,

definitely below five and really
getting into that two to three

area, that two to three percent
attrition very quickly for you

at home.

If you have a hundred clients
and you lose two people a month,

you got a two percent attrition
rate.

You're doing good.

Okay.

But if you're creeping up to be
five and six and seven percent,

like that is a business that's
going to struggle because most

people do not have the marketing
talent nor the budget to be able

to outpace a really bad
attrition rate.

And so you've got to understand
that, you've got to know that

this is such a key piece to your
business.

You cannot lose sight of that.

Do not become a marketer.

You want to be good at
marketing, but do not become a

marketer in spite of developing
a business that has a good

product that people want to
stay.

I can't stress that enough.

So that was number one.

And you gave this formula too.

I don't know if he got where he
got this formula, but he

basically gave his formula for
keeping customers.

And I learned this exact formula
from Ari Weinswick, one of my

mentors, and I don't know if
Keith got it from Ari or Ari got

it from Keith.

I don't know.

But here's the formula.

Step one is find out what the
customer wants.

Okay.

Step two is get it for them.

And step three is give it to
them.

So that's the three things.

Get go and get it, find out what
they want, go get it, and then

give it to them.

Now, obviously, it's easier to
do in a restaurant.

Like if you don't find out what
they want, I want meatloaf and

then go and get it and then give
it to them.

It's easier to do, but if you
think about this, it's does that

change your intake process?

Are you asking your customers
what they want when they start

with you?

Are you doing now?

It's a little different in this
situation where we can't just go

get it, like they have to do the
work.

Let's say they want to lose 20
pounds.

We can't go and get it.

But we have to go and get the
strategy and the plan that's

going to help them get from
their current situation to their

desired situation.

But if you never figure out what
their desired situation is, then

it's going to be hard for them
to actually get it, and it's

going to be hard for you to
develop the plan to get it.

But that that that's this
three-step customer service

rule.

It's a little more of a
product-centric rule.

And in our world, it's it it
does take them to do the work.

But at the end of the day, we
can only focus on our part, like

we can only focus on what we do.

And you can't hang your hat on
outcomes for people.

You can only hang your hat on
the things that you do.

And I'm going to give you an
example in number three about

how to define and enhance the
certainty of success, because I

think this is a really good
piece of it.

Let's go to number two.

Number two is increase referrals
and repeats.

And so repeats would be we're
not so much of a repeat business

because most of our business is
recurring revenue.

Now, an example of a repeat
would be like if you have to do

one-on-one and you do packages,
right?

Every time they renew the
package, that's like a repeat

customer.

But so that's that would be
that.

But and then increase referrals.

Now, I have this kind of thing
that I like to focus around as a

good measure of is your business
doing well with referrals?

And I learned it from Dean
Jackson.

And he basically says you want a
20% yield annually on your

customer base for referrals.

And so what that means is if you
have a hundred customers, you

should be getting 20 referrals
per year from those 100

customers, right?

So 20 of those 100 are sending
you a referral, and then it

repeats after each year.

And so that's like my what I
teach my guys to know how

they're doing with referrals.

But with referrals, you've got
to understand is that there's

two kinds of referrals, right?

There are referrals that you get
by accident, right?

The stars align.

Someone bumps into one of their
friends, their friend goes to

their website, you they opt in
through your website, you

magically call them back, they
come in for a consult, then they

sign up for a membership.

When you think about how rare
that is, and how that is like

the stars have to align for you
to get a referral.

Yes, it's great when it happens,
but if referrals are so great,

then what we want to do is we
want to have processes that

orchestrate referrals.

We want to run our business in a
way that generates referrals.

There's one way is do a damn
good job.

And if you do a damn good job,
you're probably gonna get more

of those accidental referrals.

Alright, so that's a given.

We got to do a damn good job.

But part two, after you do the
damn good job, is to create

systems around getting
referrals.

And so an example would be do
you have a bring a friend week

every quarter?

And if you have a bring-a-friend
week and you do that every

quarter and you follow specific
systems and processes, there's a

really good chance you're going
to increase the amount of

referrals that you actually get.

All right.

So at the end of the day, growth
comes down to two things,

keeping the customers your gout
and getting new ones.

And we can get better new ones
through getting better at

referral systems.

And I have a whole thing that I
teach on how to develop a

referral machine, a concept I
learned from the great Dan

Kennedy.

But a question that he actually
adds in a book, I think this is

a great question.

I've used this before.

I've gotten this quite I've read
this question in this book, but

I've heard this question other
definitely other places.

And the question is, how would
you run your business if 100% of

your future growth was by
referral and repeat business

only?

So you couldn't go out and
generate new leads, you couldn't

go out in into the community or
anything like that.

You could only go by your
referrals, the current customers

that you got, and them sending
their friends and telling their

friends about you.

Man, what do you think you'd do
differently?

Would you be doubling down on
the product and doubling down on

the staff training and doubling
down on investing and

researching the best ways that
they can get success and all

that?

It's it would change the game.

And so it's a great exercise and
a great question to sit with.

So that is number two is
increase referrals and repeat

business.

Number three, and this is an
interesting one, and something I

don't talk about often, and it's
really it's been a really good

reminder, but it's define and
enhance the certainty of

success.

And he's talking about the
certainty of success with your

customers.

Basically, what has that what
has to happen to give your

customers certainty of success,
right?

And you think about it, if uh
people come to your business and

they get what they want, they're
going to be raving fans, they're

going to be happier customers,
they're going to talk about you

more.

And there are ways that we can
run our business that help

enhance the certainty of
success.

Here's uh I'll give you one of
them.

I believe that having regular
checkpoints with your members is

a really powerful thing to do.

And so let's just say that it's
not a monthly meeting, but it's

like a quarterly meeting, right?

And instead of like you having
meeting someone once and then

you know putting them in your
system and then going you know

about their way, instead of
that, you put up a system in

place that meets with them
quarterly and you have a process

around that meeting.

And maybe in that meeting you're
redoing their goals or you're

redoing their nutrition program
or something like that.

That is an example of something
that will enhance their

certainty of success.

If there's a regular meeting
pulse, if there's regular

checkpoints, if there's regular
troubleshooting, if there's

re-evaluation of a plan, there's
a really good chance that if

that happens, that people are
gonna have more success.

And then we have more success.

Man, there's a really good
chance that if someone gets

approached by a friend to go do
bring a friend day at another

gym and they ask your client,
and they're like, What are you

crazy?

You crazy?

I'm not gonna go do another gym.

Like the gym I have is amazing.

They give me exactly what I
want.

They have good people there,
I've gotten results and all of

that.

So, what are the things that you
can do to enhance the certainty

of success with your members?

Now, I will say the first thing
about that is defining success.

Defining success.

Your customers get to define the
success, not you.

It's not about your success,
it's about their success.

If their success is coming three
days a week, that's their

success.

If their success is losing 20
pounds, that's their success.

Your job is not to define their
success.

Your job is to help them pull
help pull it out of them, and

then help develop the plan
that's gonna help them get it.

That's your job.

And yeah, I see a lot of people
that get and I used to do this

too.

I used to get all frustrated if
someone didn't get their results

and someone like I got all mad
they didn't get it.

But it's not that's not my job
is to get their results.

It's their job to do it.

It's my job is to give them the
coaching and the guidance and

the plan development and all of
that.

And the rest has got to take
care of itself.

Okay, that was number three,
define define and enhanced

certainty of success.

Number four is enhance and train
the sales process.

And I think what he's talking
about here is if you have

salespeople, and again, a lot I
know a lot of you listening

don't have salespeople, but I
think his point here is

basically that the sales process
is so important.

Like when a customer calls you
for the first time or they come

sit down with a consult, like
that is that's a critical event

in your business to make more
money, right?

And his point is about getting
better at sales.

That's what he's talking about.

He's talking about the training
that you need to do and the not

just the training that you do,
but the training around having a

system, right?

The formula for how you get
success.

I talked about this a few
podcasts ago when you have to

have some semblance of a process
when you go into a sales

meeting.

Like if you're getting on a call
and trying to book an

appointment or you're sitting
knee to knee in an office with

them, you can't be winging it
and doing something different

every time.

There should be a process that
you follow.

No, you don't need like a script
to read word for word.

You don't need that, you
shouldn't have that.

But man, should you have a
series of questions that you ask

people every time that you get
on the phone with somebody to

try and book an appointment?

Absolutely.

And he so he's talking about
enhancing that process, like

getting the people that are
doing the sales that they're

training to get better, and then
the process that you are using,

you're constantly evaluating
that and finding what's working

and changing and tweaking what's
not working.

But the biggest thing to take
from this is what are the things

that you need to do to make your
sales process better?

And then how can you train the
people, even if that's you?

Like when was the last time you
listening to this?

When was the last time you took
a sales training course?

When was the last time you tried
to get better at closing

membership people into
memberships?

Very few people do that, right?

And so it's an important piece,
important part of the business.

So it's something you should
work to get good at.

Number five is the increased
conversion percentage.

So now we're staying on the
sales piece of it, and this is

about the conversion
percentages.

And I really look at two
percentages for your

conversions, right?

The first conversion percentage
is your conversion from lead to

consultation or free trial or
whatever you want to do.

Basically, that first hit that
they get.

And then the second conversion
is their conversion from the

consultation to a new member,
right?

Or the free trial to a new
member.

That's the two conversions.

And typically what I see is
anywhere from what's good is

anywhere from a 20 to 30%
conversion rate on lead to

consultation.

I'm just going to use that term
for now.

And then a 70 to 80% conversion
rate from consultation to new

member.

If you can hit those numbers,
but his point is that a 5%

conversion rate, if you go from
25% conversion rate to 30%

conversion rate, you are going
to drastically increase the

amount of people that you close
over time, and you're going to

decrease the amount of leads,
right?

It's basically, it says it right
here, if you're currently

closing 25% of your leads, a 5%
increase in your close ratio is

equivalent to an increase in
your leads by 20%.

Right?

So you don't need as many leads.

If you want if you increase the
conversion rates in your sales

process, you need less leads.

It's like free leads.

You're gonna make you're gonna
make more money with less leads.

It's amazing.

Right?

And so you gotta look at that
these conversions.

The first thing you need to do
is be measuring this.

And I typically will measure
this on about a monthly basis,

right?

I don't think you need to do
this weekly, but you should be

looking at the conversion
percentages.

And it's really simple.

It's just look at it like this.

Like, all right, how many leads
did I get?

100 in the month.

If uh we're I'm recording this
in November.

Just look back to October.

How many leads did you get?

Alright, I got 100 leads.

How many people sat in your
consult room?

Twenty.

Or you got a twenty percent
conversion rate, right?

That's basically what happened.

All right.

Or you had 20 consultations,
right?

How many of those became new
members?

10 of them.

All right, so you get a 50%
conversion rate, right?

And so you got to look at these
conversion rates from a monthly

basis, and then you gotta kind
of see what is good.

You use my numbers that I gave
you before, and if you're on

track there, great, keep going.

But if you're well behind,
that's an area for you to pick

that up, right?

You want to pick up that part of
your business.

So if you're at a 10% conversion
rate right now from lead to

console, you gotta pick it up.

You gotta get that 10 and get it
to 20.

And now you need to either train
the person, you need to increase

the uh the the training on the
process that you're using.

Whatever you need to do, that's
the area of your business that

needs to be improved.

Okay, that's number five.

Number six is increase the
transaction size.

And this is a big one that Jay
Abraham talks about, increase

the size of the transaction.

Now, I have talked about this to
you guys ad nauseum, but the

number one way to increase the
transaction size is to alter the

price, right?

So if you want, if you have a
hundred customers paying you 200

bucks a month and you move
everyone to 250, you are going

to drastically improve the
financial health of your

business.

So that that is the number one
hack of increasing transaction

size.

Another way to do it is to think
about is there a higher priced

option that you could create?

So if your highest package right
now is 500 bucks a month, do you

have something that you could
sell for$1,500 a month, right?

So just a larger package or
something like that.

So that's the sixth one is
increase the transactions.

I talked so much about this from
a price standpoint for with you

guys.

I'm not going to go beat this
up, plus this podcast is already

getting pretty long.

But that was number six, is
increase the size of the

transactions.

And you're going to do that most
likely by enhancing the price.

Number seven is increase the
frequency of transactions,

right?

And so this is going to be about
taking your current customers

and selling them more stuff.

So here's where I and I'm never
going to say I disagree with

Keith Cunningham because he's a
genius and I'm an idiot compared

to him, but I do believe that
this is only for businesses that

have a certain number of
customers, right?

And so if you're going to focus
on increasing the frequency by

selling your customers more
things, and you only have 20

members, only a certain
percentage of members are going

to buy other stuff, right?

It's not a good use of your time
to try and get three people to

buy supplements.

So I do believe this is right.

Like I have gyms that have 500
members, and it's all of a

sudden they just added
supplements or they added other

programs or they added other
things, they would massively

increase the revenue.

And that's one of the beauties
of having a lot of people,

right?

The tough part about having a
lot of people is the churn

rate's high.

Not the rate high, but the
number that you're losing.

So if you have a thousand
members and you have a 5%

attrition rate, that's a crap
ton of people that you're losing

every month, right?

So you got to take the good with
the bad.

But this is about increasing the
frequency, getting your

customers to buy more stuff,
right?

And if you're already getting
them on a monthly membership,

they're paying that monthly
membership.

There's a really good chance and
likelihood that if you put out

other things for them to buy, if
you had stretching services, if

you had massage, if you had
supplements, if you had

nutrition coaching type things,
there's a good chance that

they're going to buy that stuff.

So that's number seven is
increasing the frequency of

buying.

Number seven, sorry, number
eight, this last one, is

increased leads and traffic.

Now he has this last, I think,
to try to make a point.

And I think what he's talking
about is probably digital leads

and Facebook and stuff like that
to try to get high volume leads.

He's probably not talking about
building relationships in the

community, which I think you
could almost put that, like

joint ventures and stuff like
that, where you're take making

relationships with people in
your community.

You could probably put that into
number two, where increasing

referrals in there.

So I think he's talking about
choice, and this is important,

right?

You want to have a good website,
you want to have leads while you

sleep, as I talked about in a
podcast when I did with GR and

stuff like that.

But his point here and why he
put it last is he wants you to

you to optimize before you
maximize.

That's the line that he uses
right here.

And shoot, if we're spending all
of our time on driving more

traffic and getting more leads,
and we're losing everyone out

the back because we have a
shitty retention system where we

put crappy trainers on the
floor, all that increase of

leads and traffic is gonna do
nothing.

And so they I think that's his
point of putting it last, is to

really make sure that you're
doing the important things

first.

All right, and so that's I guess
why he's doing it.

So that's it.

That's the I get it.

I tried to do it in under 30
minutes.

I'm a little over right now.

But yeah, that was I I don't
know.

I just love that chapter.

It's the chapter is called
Prioritizing Growth Strategies.

The book is The Road List.

Dupe it's my favorite business
book on the planet.

Again, I've read it a million
times, and it's just some really

good stuff in there.

And I was happy to do this one
of not only just reading you

what he said, but also putting
my experience in connecting that

with it.

I thought that was hopefully it
was helpful for you guys.

So I'm gonna go in and watch
Joey do some judo now.

And uh hopefully that you're if
you're a gym owner and you're

listening to this and you want
to get the inside scoop and get

some of this stuff on a regular
basis by coming to some of the

SPF mastermind meetings,
definitely shoot me an email or

reach out to me,
vintagecaprielf.com.

And I really appreciate you
listening.

We have this is ranked the
number one.

One fitness business podcast in
the world.

Until a next one comes out, we
are number one.

And I'm going to keep saying it.

And that's not that's only
because people, good people like

you, keep listening and taking
action on the stuff that we're

teaching here.

So appreciate it.

Again, even though we're number
one, it always super always is

very helpful if you and
subscribe.

So if you could follow the show.

Sorry, not and subscribe.

That's YouTube, right?

If you could follow the show and
then leave us a comment.

Like the I it's pathetic.

The last comment or not review
we got for this podcast was like

a year ago by a guy named Plyo
Freak.

And so you gotta I keep seeing
Plow Freak all the time.

Just come on.

Give us a review for the podcast
so I can get Plyo Freak out of

there.

But thank you, Plow Freak, if
you're a listener, I appreciate

it.

But anyway, so hopefully this
was helpful.

He's a genius, and I'm honored
to be able to just read this

stuff to you and do some really,
really good stuff for you guys

to take home, and maybe you can
listen to this one again and

take notes on it.

I think it was probably a
noteworthy one from there.

But appreciate you.

Talk to you later.