
New York
CNN Enterprise
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A gymnasium membership in the USA sometimes 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 gymnasium chain hasn’t raised the worth, making it one of many few issues that also prices the identical regardless of the best inflation in a long time.
Planet Health blares out the $10 gymnasium plan, which incorporates annual charges and free coaching, in commercials, and the corporate has lengthy sponsored the New 12 months’s Eve celebration in Occasions Sq. to get individuals interested by signing up for memberships as their decision.
That just about sacrosanct $10 worth has develop into a key a part of the corporate’s model positioning as an accessible, “judgment-free” membership conducive to informal gymnasium goers. Planet Health members sometimes go 5 or 6 instances a month, and round 60% of them don’t go to in a 30-day stretch.
“It’s a really highly effective advertising and marketing instrument,” mentioned Simeon Siegel, who covers the corporate at BMO Capital Markets. The $10 worth is true within the candy spot, he mentioned: low-cost sufficient to attract individuals to Planet Health who wish to get in form and, equally as necessary, not so costly that they may cancel in the event that they don’t go typically.
For $10 a month, rare customers are likelier to carry onto the membership to say they belong to a gymnasium reasonably than stop, he mentioned.

Planet Health makes use of $10 dues, which may be canceled at anytime, to recruit people who find themselves serious about exercising, however have by no means joined a gymnasium earlier than, are intimidated by health fanatics at different gyms or can’t afford pricier golf equipment. The corporate believes $10 is an entryway for the roughly 80% of Individuals who don’t belong to a gymnasium.
This cheap gymnasium membership mannequin – identified within the health business as excessive quantity, low worth, or “HVLP” – can be tailor-made to enchantment to high-school college students accompanied by a father or mother, 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 business guide.
“It’s a ‘get you off the sofa’ worth,” 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’re not going to present one thing a attempt for the primary time and spend $50, $60, $70,” he mentioned.
Planet Health doesn’t plan to lift the $10 worth anytime quickly. As an alternative, it is going to maintain down the worth by getting individuals 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 individuals 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 affords entry to all of Planet Health’ gyms and perks like water therapeutic massage beds, therapeutic massage chairs and tanning gear, and Black Card members may carry 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 maintain the decrease plan at $10.
“It’s not that totally different from different companies that entice you with a low worth level after which upsell you with larger choices,” mentioned Joseph Altobello, an analyst at Raymond James.
To enchantment to occasional gymnasium goers, Planet Health’ golf equipment even have extra cardio and light-weight energy gear than many opponents and fewer heavy free weights. Planet Health discourages what it calls “lunk” habits, comparable to dropping weights and grunting, and has a “lunk alarm” to forestall individuals from dropping them.
Planet Health has benefited from the consolidation of the health business in the course of the pandemic, which has left the corporate with fewer budget-gym opponents.
Round 25% of US gyms and studios completely closed in the course of the pandemic – roughly 10,000 amenities, in accordance with the business commerce group. A number of main chains, together with 24 Hour Health and Gold’s Gymnasium, filed for chapter.
Planet Health, nevertheless, didn’t completely shut any gyms in the course of the pandemic. This was largely attributable to its franchise gymnasium 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 larger than they had been in 2019, in accordance with Placer.ai, which tracks foot site visitors to retailers.
Regardless of the rise of Peloton and the at-home exercises many individuals bought used to throughout pandemic lockdowns, at-home train shouldn’t be a menace to Planet Health’ $10 mannequin.
“It’s a unique buyer,” Altobello mentioned. “Not everybody has the cash or the area to create an at-home gymnasium.”