Avery Fitness Center
How can we grow revenue?
Leah Goldblum, Adam Gellin, Will Maples, & Joshua Otto
Team
01 - Who is AFC?
02 - AFC Demographics
03 - Analysis & Statistics
04 - Findings
05 - Recommendations
06 - Executive Summary
“Growth is never by mere chance; it is the result of forces working together.”
James Cash Penney
01 - Who is AFC?
The Avery Fitness Center (AFC) is located in a midsized city in the southeastern United States. Offering a variety of exercise programs to its members under the supervision of personal trainers. Founded 15 years ago, AFC operates from a single location near a large university. AFC primarily targets “prime-timers”, some of whom are struggling with health issues. Many customers are attracted to the large indoor therapy pool, fitness classes, weight training, exercise circuit, and circulation station.
Background
What is AFC’s Opportunity and what can be done ?
The Question:
Can increasing class attendance, enhancing the social environment, and amplifying the AFC Director's role in promoting services lead to increased revenue?
To do this we will focus on increasing customer satisfaction and membership numbers. We will have special focus on women with annual income of $30,000 - $75,000. Utilize member events and increased visibility of the AFC using the AFC Director speaker to highlight key services like classes.
73.5% of AFC’s Members prefer to workout in the mornings
02 - AFC Demographics - Who are AFC’s Member's?
AFC’s Member Population is 76.6% Females and 19.5% Males
The majority of AFC’s members have an of income $45-60k.
54.5% of AFC’s members income is between $30-75K.
02 - AFC Demographics Cont.
We found the reasons AFC Members participate, exploring which reason had a significant impact on revenue finding that Social aspects are important to our members
ACF’s members use the services, the largest popularity in pool (33%) usage, weights second (23%), and third classes (19%).
Of all of AFC’s activities offered, classes has been proven statistically significant to have an effect on revenue, and the brings in the most at $320.35 per member who attends classes. Those member that attend classes also visit AFC almost 50% more then those who do not.
03 - Analysis & Statistics
Taking a look at our revenue by social rating, we see that most of our revenue is coming from those who value the social aspect of coming to the fitness center.
When looking at our revenue by attendance ratings, we can confirm that we receive higher and more consistent revenues from costomers who regulary attend than those who do not attend as much.
03 - Analysis & Statistics
The heatmap below just confirms what we saw previously - that most of our income comes from those who value social aspects of fitness, and those who attend often. Knowing this information about our demographic of elderly members helps us identify our ideal target that will lead to better revenue.
Heat Map
03 - Analysis & Statistics
03 - Analysis & Statistics Multivariate Analysis
04 - Findings
- Class attendance and the relative importance of social aspects are key variables influencing revenue.
- AFC members who regularly attend classes and place a high vale on the social atmosphere of the center attract more revenue than other members.
- Members who regularly attend classes tend to visit the Fitness center nearly two times as frequently as those who don’t attend classes.
- Managers at the AFC can capitalize on these insights through increased promotion of classes and the facilitation of the social environment at the AFC.
What does the Data point to?
04 - Findings - Analysis
Advertising
+$15.52
Speaker
More
Once we’ve identified our ideal target we looked to further our analysis by learning more about what modes of advertising would be best suited to reach that target.
We found that the advertising mode that bought the highest average revenue was AFC Director’s speaking appearances.
When we look at the coefficients we see that Speaker has a positive relationship with fees paid. All other variables a negative relationship with fees paid. Since speaker has a positive relationship that means for 1 unit increase in the speaker revenue increases by about $15.52, this difference could have been due to random chance and should be further studied. We suggest trying to use the AFC Director’s speaking appearances to test this theory .
R Square 0.14
04 - Findings - Multivariate Analysis
Social
Visit Frequency
Age
We learned that the R square in the regression is 14.3% which indicates that this model represents 14.3% of the variation in fees paid. Therefore, age, visits, and social rating can predict 14.3 % of fees paid. This model is a good fit because all variables are significant even though it only represents 14.3% of the variation.
In this model social rating, age, number of visits are significant. When we look at the coefficients, we see that they all has a positive relationship with fees paid. Since all have positive relationship for 1 unit increase in the social rating revenue increases by about $21.94.
05 - Recommendations
The analyses collectively indicate that targeting female members through AFC’s Director Speaker events, particularly those interested in classes and social aspects, can significantly impact revenue. This directly addresses the goal of increasing revenue by enhancing customer satisfaction and membership.
- Develop and promote class programs tailored for female members.
- Organize and enhance social events to improve member engagement.
- Implement targeted marketing strategies for the elderly and specific income groups.
- Explore new services or amenities that cater to the identified key demographics.
- Utilize data insights to inform AFC's operational and strategic decisions.
06 - Executive Summary
Classes and social engagement are key revenue drivers.
Targeting female members can significantly impact revenue.
Key Learnings:
Female and elderly members are a significant demographic.
Revenue increases with class attendance and social activities.
Members' reasons for participation influence their spending patterns.
Recommendations:
- Develop and promote class programs tailored for female members.
- Organize and enhance social events to improve member engagement.
- Implement targeted marketing strategies for the elderly and specific income groups.
- Explore new services or amenities that cater to the identified key demographics.
- Utilize data insights to inform AFC's operational and strategic decisions.
Thanks