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Why Planet Health hasn’t raised its $10 month-to-month fitness center value in 30 years

New York
CNN Enterprise

A fitness center membership in the USA usually prices round $50 a month. Boutique gyms and high-intensity lessons run double and triple that.

Planet Health, nevertheless, has provided $10 month-to-month memberships for 30 years. The no-frills fitness center chain hasn’t raised the worth, making it one of many few issues that also prices the identical regardless of the best inflation in many years.

Planet Health blares out the $10 fitness center plan, which incorporates annual charges and free coaching, in commercials, and the corporate has lengthy sponsored the New Yr’s Eve celebration in Instances Sq. to get folks enthusiastic about signing up for memberships as their decision.

That just about sacrosanct $10 value has turn into a key a part of the corporate’s model positioning as an accessible, “judgment-free” membership conducive to informal fitness center goers. Planet Health members usually go 5 – 6 occasions a month, and round 60% of them do not go to in a 30-day stretch.

“It is a very highly effective advertising software,” mentioned Simeon Siegel, who covers the corporate at BMO Capital Markets. The $10 value is correct within the candy spot, he mentioned: low cost sufficient to attract folks to Planet Health who need to get in form and, equally as essential, not so costly that they may cancel if they do not go usually.

For $10 a month, rare customers are likelier to carry onto the membership to say they belong to a fitness center fairly than stop, he mentioned.

Planet Fitness draws customers into gyms with $10 memberships and convinces them to trade up to its $24.99 plan.

Planet Health makes use of $10 dues, which might be canceled at any time, to recruit people who find themselves concerned about exercising, however have by no means joined a fitness center earlier than, are intimidated by health fanatics at different gyms or cannot afford pricier golf equipment. The corporate believes $10 is an entryway for the roughly 80% of Individuals who do not belong to a fitness center.

This cheap fitness center membership mannequin – identified within the health trade as excessive quantity, low value, or “HVLP” – can also be tailor-made to enchantment to high-school college students accompanied by a mother or father, school college students and other people recovering from an harm or surgical procedure, mentioned Rick Caro, the president of Administration Imaginative and prescient and longtime health trade advisor.

“It is a ‘get you off the sofa’ value,” mentioned Christopher Rondeau, the chief govt of Planet Health (PLNT), which has grown to greater than 2,300 gyms nationwide and reached a record-high 16.6 million members final quarter. “You are not going to present one thing a strive for the primary time and spend $50, $60, $70,” he mentioned.

Planet Health doesn’t plan to boost the $10 value anytime quickly. As an alternative, it would preserve down the worth by getting folks to commerce as much as its $24.99 month-to-month “Black Card” membership with extra perks.

“The longer I can keep at $10 the higher off I’m to get folks off the sofa, give health a attempt to proceed to drive extra worth within the Black Card,” mentioned Rondeau.

The upper-priced month-to-month plan provides entry to all of Planet Health’ gyms and perks like water therapeutic massage beds, therapeutic massage chairs and tanning gear, and Black Card members also can deliver a customer.

Greater than 60% of members subscribe to this tier, which Planet Health elevated by $2 a month earlier within the yr. The common Planet Health member pays round $17.60 a month, serving to the corporate preserve the decrease plan at $10.

“It is not that totally different from different companies that entice you with a low value level after which upsell you with increased choices,” mentioned Joseph Altobello, an analyst at Raymond James.

To enchantment to occasional fitness center goers, Planet Health’ golf equipment even have extra cardio and lightweight power gear than many rivals and fewer heavy free weights. Planet Health discourages what it calls “lunk” conduct, equivalent to dropping weights and grunting, and has a “lunk alarm” to forestall folks from dropping them.

Planet Health has benefited from the consolidation of the health trade through the pandemic, which has left the corporate with fewer budget-gym rivals.

Round 25% of US gyms and studios completely closed through the pandemic – roughly 10,000 services, based on the trade commerce group. A number of main chains, together with 24 Hour Health and Gold’s Fitness center, filed for chapter.

Planet Health, nevertheless, didn’t completely shut any gyms through the pandemic. This was largely on account of its franchise fitness center mannequin, with among the gyms owned by private-equity teams.

The corporate has additionally capitalized on Individuals seeking to get in form within the aftermath of the pandemic. Month-to-month visits to US gyms are increased than they have been in 2019, based on, which tracks foot visitors to retailers.

Regardless of the rise of Peloton and the at-home exercises many individuals received used to throughout pandemic lockdowns, at-home train just isn’t a risk to Planet Health’ $10 mannequin.

“It is a totally different buyer,” Altobello mentioned. “Not everybody has the cash or the area to create an at-home fitness center.”


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