Cultivating Larger Purchases and Returning Customers
Customers are great, but getting those customers to commit to returning on a regular basis is even better. There are a few different schools of thought in regards to encouraging return customers, but they’ll generally fall into two main categories, Memberships and Packages.
We’re going to provide a little insight into how to utilize each of them at your center.
These two options are ways of encouraging larger purchases, getting customers to commit themselves to further floating, and ideally sharing the experience with others.
Just visit FloatHQ.com if you would like to see Float On’s current pricing and membership structure.
But for the purpose of this post, we’ll start with some quick examples…
Memberships: Memberships can be best described as a float subscription. A customer will sign up for a regular, recurring amount of floats, and these floats are generally at a discounted rate. Since Memberships have a built in regularity (usually a new purchase every month) memberships are usually for smaller amounts of floats, and are often designed with the idea that the customer will use all of their floats before the next are purchased.
4-Float Monthly Membership: $280 (offers a $70 per float price)
Packages: Packages can be easily likened to a bulk discount. A customer will buy a bundle, or package, of floats at one time, and these floats will be less expensive than that same number of floats would be individually. Packages are normally larger amounts of floats, but can essentially be of any amount greater than one. Often, packages do not expire, or have longer-term expirations, and the float service credits the customer has will be used over time, at the customer’s discretion.
[Note: For the purpose of this article, I’ll be talking about larger quantity Packages, as explained below.]
12 Float Package: $720 (offers a $60 per float price)
Deciding on Memberships vs. Packages
There are general similarities between these two options: These types of purchases are a commonly employed method of cultivating customer engagement for your center, and with floating in general. They are enticing to the customer when compared to the single float cost and encourage them to make the larger purchase if they plan on floating more often. Customers who purchase packages and memberships are choosing to get more involved with your center, and you receive a variety of benefits as a result.
Having said that, packages and memberships each have their own unique benefits as well.
As mentioned, the money received from Memberships is regular and recurring. Once you’ve built up a Membership base, your center will have this regular income to depend upon, and this number is not likely to change drastically from month to month. While individual members may join and leave, there is likely not to be a mass exodus of members from your center. This dependable income is definitely one of the largest benefits to Memberships, and gearing your customers towards them.
On a per-float basis, Memberships often offer float centers more income, as these Memberships aren’t sold in as large quantities as Packages, and thus do not offer as large of a discount.
Memberships are more of a form of commitment, both to the idea of floating, and to your float center. Humans are creatures of habit, and regular practice is the first step towards making something habitual. Memberships have a built in regularity, which encourages people to continue floating in the future.
Packages are (often) larger bundles of floats, because of this, one of the main benefits of selling packages to customers is the larger price point and the security in knowing that your tanks have future customers, and will not be sitting empty.
Another benefit of packages is that they give the customer a “windfall” of floats, leading them to potentially give some away. We find that customers often spread some of these floats around over time to their friends and family (or plan this from the start), giving them their first experience in the tank. In this way, enthusiastic package holders can become a marketing team for your center as well.
Potential Membership Weaknesses
As mentioned, since they are charged on a regular basis, Memberships are (usually) for lower numbers of floats, and less money will be coming in immediately. However, the recurring payments on memberships usually add up to more money in the long run.
Since Memberships are (usually) lower numbers of floats, it is not as likely that Members will share their floats. In fact, many centers will actively prohibit sharing of member floats. We think that the more people introduced to floating the better, and allow sharing of member floats with as many people as our members want, as well as offering Members any additional floats they would like to purchase at their Membership price.
Potential Package Weaknesses
Unlike Memberships, Packages don’t build in any regularity to the customer’s floats. We have (unfortunately) seen portions of packages go unused, or just used sporadically over time, and in these situations it is very unlikely that the person will purchase another package in the future. This can be combated by being sure to try and book your customer’s first few floats as soon as possible, and attempting to create that schedule for them.
Because they do not recharge automatically, and because package holders are often purchasing with longer timelines between purchases, Package holders can be very hard to keep as customers without regular attention and ensuring they are actively using their floats/scheduling themselves.
Which should offer the better discount per float?
While this is ultimately going to be dependent upon your own center’s arrangement, generally, larger Packages will often offer a better discount per float than Memberships, and it may be that the cheapest per-float cost option you’ll have will be a Package (this Package would also probably be the most expensive option sold in your center).
It’s important to note that all else being equal, Memberships should be the most enticing option for customers. Packages generally only offering better per-float prices if they are offering larger amounts of floats at once. If a package is offering the same or similar amount of floats as a membership, the membership is more beneficial for your center.
Consider a package and a membership which both offered 3 floats: In this situation, the package offers nothing further in terms of the amount of floats sold (it’s not a large amount, so doesn’t encourage sharing, and isn’t going to be a much different price tag). Most importantly packages don’t bring your float center recurring revenue every month the membership is held.
The membership, on the other hand, may encourage a much more regular floating habit. The membership, in this situation, is of more value to you, and as such, you will likely want to price the 3-Float Membership lower than the 3 Float Package.
Because of this, many people choose to not offer lower float packages, and only use packages for larger amounts (if they decide to offer packages at all).
Additional Considerations for Memberships
You can also tip the scales towards your various Membership options by offering a variety of in-center perks or benefits to your customers, to encourage them to decide between various available options.
These perks could either be tiered, or just generally offered to any customers who make purchases of your choosing.
Offering any additional floats at the same per-float price as the offering – This is very common, and is a great way to encourage someone to float as much as they can handle (and get that nice discount each time), and also a great way of encouraging someone to share their float enthusiasm with friends and family (and get them that nice discount, too!).
Allow People to Cancel at Any Time – It’s more and more rare to see float centers enforcing 3 or 6 month contracts for their memberships. Allowing people to cancel at any time may let some people get cheaper floats without staying on board, but way more people end up loving how reasonable you are (and loving floating) and decide to stick around for a bit.
Offering retail discounts – If you do carry retail, this is a great way to move more of your products, or at least get customers to pay a bit more attention to it. Depending on your retail profit margins, you may be able to make certain products very appealing with a fairly hefty Member discount.
Offering FREE things – Here at Float On we offer our members free Kombucha made by a local company that we have on tap. It’s a bit of an expense if our members drink more than our paying customers, but it’s a nice offering for our more dedicated floaters.
If you’re interested in learning more about float center marketing, definitely take a look through some of our other sales and marketing blogs, or feel free to reach out with any specific questions to firstname.lastname@example.org.
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