Major Business Challenges of Wellness Organizations

The Major Business Challenges of Wellness Organizations

The term “wellness center “is used as a broad “catch-all” for businesses that offer different kinds of services such as spas, gyms, health clubs, massage centers, yoga, and Pilates studios, etc. Most of these organizations have a burgeoning demand for their services. However, there are a number of business challenges that they also need to deal with and the eight major ones theseof are outlined below.

Managing Rapid Growth
The building of wellness centers of all kinds has exploded as individual interest in good health and fitness in general has increased so dramatically in recent years. But will this very positive trend comes the challenge of dealing with dealing with the demand and managing the growth in customers at one facility and then perhaps adding others over time. In theory this is a good problem to have, but in practice can be a significant challenge to many business owners who don’t pay attention to what their competition is doing and spend too little time adjusting their business model to deal with changing conditions.

Getting the Pricing Right
Price sensitivity is a factor that comes into play in most wellness centers. In most of these businesses customers range from those looking for low prices and basic services (gyms deal a lot with these customers) to customers willing to pay a premium and pay for a so-called “luxury” experience. One method of reducing the price charged in a wellness center is to reduce the number or quality of services. After all, since labor is a large component (as much as 50% or even more of the service cost), a reduced or more “no-frills” service cuts labor costs and therefore the price can be reduced. Even with the reduced service, customers can still enjoy the wellness center experience and “scale up” as they can afford to do so.

Broadening the Customer Base
In addition to pricing strategies, another approach to reaching and attracting a broader audience has been to target people in a wider age range from young to old. This means helping age groups at all levels to appreciate the benefits and value in visiting a wellness center, enjoying the experience and then bring in friends and colleagues to share that experience. These new customers obviously add greatly to overall revenues and help to ensure that staff and equipment are better utilized.

Establish Solid Membership
Many wellness centers have found greater fiscal stability by creating wellness center memberships that help bring local customers in on a repeat basis. In this type of program, wellness center services are often discounted when purchased in “bulk” or a customer is making a commitment to monthly or even yearly services. This is a great way to create overhead recovery and get better utilization in “quieter” timesof the day (by holding member only sessions and times perhaps). Membership programs build the local market while creating a strong database of wellness customers who liveclose by to facilities. With a little planning and effort, reaching out to this local membership list in slow times, or for networking, or for special occasionssuch as charity events, presentations and educational programs can all be an effective way to build long-term loyalty.

Evolving the Lon-termWellness Message
One factor that all wellness center customers share is their need to take better care of themselves over the long term. Therefore, the message which should be evolved,should stress the need to invest in the customer’s health and in the wellness center as a primary means to deliver the message consistently or as a “healthy investment”.

Establishing Good Web “Conversion”
The simple goal ofany marketing effort is to “getting the phone to ring/make some kind of contact” and ultimately “book/pay for a product or service”. While direct marketing was a primary way to reach out to do this in the past, today the Internet (and a wellness center web site) and social media, does much of the marketing “heavy lifting”. Unfortunately neither wellness center web sites not their social media presence are doing enough to drive customers to buy and encourage others to do the same. Clear strategy to set this up well and to follow through with regular communication effort is therefore critical here.

Personalizing the Experience
Many wellness centers are very transactional and impersonal. However, there are many points along the path through the wellness center that can be much more engaging for the customer and much more personal. Of course it’s important to streamline processes, keep service levels consistent, and make sure that customers keep coming consistently through the doors. As technology continues to offer great data collection opportunities, wellness center directors need to ensure that the customer experience remains personal and that the staff really works to understand the customer’s needs.

Getting the “Right” Staff and deploying them well
Sometimes, even when wellness centersare relatively busy, they still have open rooms or sessions available and no staff to deliver the service. Flexible scheduling is the most obvious solution here and best-practice wellness centers are therefore hiring smart staff that can help to keep utilization levels high and not just “take a wage”.

Summary
Wellness centers of all kinds today need to operate in smarter or more efficient ways in order to compete in this fast growing sector. RX4 has experienced all of the challenges described above in many different wellness center environments and can provide considerable insight and options where the knowledge is limited or does not exist internally.

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Dr Jon Warner

Dr. Jon Warner
CEO-RX4 Group-Taking Care of the Business of Healthcare

Jon is the CEO of RX4 Group based in Los Angeles, California. He can be reached at jon@RX4Group.com

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