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Free gym workouts for people staying at local hotel. How much to charge the hotel?

by biggoogle
9 replies
Hey folks,

A client of mine will become a father pretty soon, and I am giving him a hand with his marketing so his child can have a better quality of life.

This client was struggling until I came on board. We're now doing and working on setting up Joint Ventures in our local area.

There is a hotel in this city that is a three minute walk from the gym. This hotel is the biggest one in town, and it does not have a workout room.

Folks who stay at the hotel come by the gym to work out from time to time.

One idea I had was to charge the hotel a set fee (per month or annually) to offer free unlimited access to the gym to all their clients (for the length of their stay). It could help set them apart from their competitors, and their clients would definitely appreciate it.

The hotel has 90 rooms and charges $80 or so for standard rooms.

They have a LOT of money to spend. I was thinking that $500 a month ($17 a day) would be very fair. If they find that it is expensive, we could throw in a free protein shake as a bargaining chip. It only costs my client $1 or so (and not more than $2 if three fruits are used.)

What are your thoughts?

Thanks!

BigG
#charge #free #gym #hotel #local #people #staying #workouts
  • Profile picture of the author Aaron Doud
    Does he have any stats about how many of the guests comes down?

    1. he can use that data to sell the Hotel on offering it. Look at this.... our gym sees about 2 guests of yours per day on average. Clearly your guests are looking for this service. How many guests do you think don't book because of the lack of a gym? $500 a month is very little to spend for the piece of mind of booking more guests.

    2. Your friend could lose money this way. Let's say he has a $5 daily fee. If he gets 5 guests per day to come over he is getting $750 vs. $500. Now if some of these are local guests and he gets people to use his gym regularly it might be worth it still but make sure he isn't losing revenue without a clear advantage.
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  • Profile picture of the author vndnbrgj
    What is the hotels average occupancy rate?

    I don't care if they have 90 rooms if only 15 are used at a time.
    Then, you have to take the average occupancy rate and do what Aaron said.
    Figure out how many people on average come to the gym from the hotel.
    Then, you have to do research on occupancy rates for hotels with gyms (or gym access) and those without.

    Once you have all this info, you will have a better pitch and a better idea on pricing..
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    • Profile picture of the author Anthem40
      $500 a month seems cheap to me, but it is better than a stick in the eye.

      Consider the cost for the hotel to create a room for a gym, fill it with equipment that is expensive, get additional insurance (probably way more than $500 per month), buy more TVs, more A/C, more electric, more upkeep and maintenance.

      Then look at what the others have said- how much money is the hotel losing out on because their competitors have an edge that is considered standard service. And the people that book hotels for their gyms are usually staying on business for several days to several weeks. It's a no brainer.
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      • Profile picture of the author Claude Whitacre
        Me?

        I wouldn't charge them anything. This is marketing.

        It's like asking "How much should I charge the newspaper for letting me put my ads in the paper?"

        You make money from the daily fees, and selling guests while they are at the gym. Doesn't your client have health drinks, vitamins, protein powder, exercise DVDs, or three days workout memberships (however long the stay is for)?

        If I owned the hotel, I would ask him to pay me.

        You should even give each guest a sheet of coupons good at the gym.

        No intelligent hotel owner would pay for this. They are sending your client paying customers...and you want the hotel to pay him?

        I own a retail store. I don't charge admission.
        I know a gym is different. But the money isn't in the daily fee, it's in the sales made while the prospect is there.
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  • Profile picture of the author SashaLee
    Hi there,

    I agree with Claude.

    If he were to offer a "free protein shake with any 30-minute workout" and the hotel were to let him/you distribute the fliers for this, or better yet hand one out when they check in, you'd be very lucky. To ask them to pay you to market your services is not the way to approach this.

    The room rate is only $80 which makes this is a discount hotel in the first place. Their profit margins are low. I'd be amazed if you could get $500 out of them, but prove me wrong!

    All the best,

    Sasha.
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  • Profile picture of the author NewParadigm
    make up "free workout" cards/passes for the hotel for them to promote/distribute to guests, then when the guest presents the card you redeem it back to the hotel for whatever your daily fee you charge $5-$10. That way they only pay for the guests that use it, and they can advertise they have workout facilities avail to help occupancy.

    Gym upsells are very small. Charging to use the gym IS the main product, it is not like charging people to come into a retail store. Do retail stores GIVE AWAY their main product?
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    • Profile picture of the author biggoogle
      Thanks everyone for your replies.

      I really appreciate it.

      BigG
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    • Profile picture of the author Claude Whitacre
      Originally Posted by NewParadigm View Post

      Gym upsells are very small. Charging to use the gym IS the main product, it is not like charging people to come into a retail store. Do retail stores GIVE AWAY their main product?
      I've been in gyms that would never think of trying to make money off of their members...and I've been in gyms that are set up to sell lots of services and product to new members, and on nearly every visit.
      You can give away a 1 day pass, which is really a presentation selling a 3 days membership....

      Theaters make the bulk of their money at concessions. Maybe that was a better example.

      By the way, the single most profitable promotion I've ever done is mailing out a $10 gift certificate to local home owners. There was no condition on the certificate. We got a lot of people that just spent the $10 (or a part of it). But on average, it brought in $8 in profit for every dollar in real costs.

      And there is no real cost in having someone stop by the gym for a day.
      So they are really giving away nothing.

      The problem I see is that most gym owners are gym rats that just bought equipment and opened a gym. They aren't business people. Marketing is something the have only heard about.

      But a sharp gym owner? The money is in the membership contracts and sales of stuff to the members....massages, tanning beds, towel rentals, vitamins....you get the idea.
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  • Profile picture of the author pingsters
    Banned
    A great idea!
    Can you find out how many visitors are received to the hotel on a monthly basis?
    Then from there you can tell whether the venture is viable or not.
    $500 per month is a bit low but if that is the offer then go for it.
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