If you know me, you know that I love yoga and practice several times a week. To find the classes that work best for me, I visit several studios, and have seen how their pricing models have changed.
Most yoga studio owners are not MBA-types, even here in Silicon Valley, where business plans are as ubiquitous as screenplays in Hollywood. But studio owners are entrepreneurs, and generally are bootstrapping their businesses. Bootstrappers, by necessity, are always developing creative ideas and testing new business models.
Here are a few tactics I've seen over the past few years:
1. First lesson full price–second lesson free. This tactic ensures that only "serious" prospects realize the trial benefits–the incentive is to come the second time, not the first time. Also, because payment is required the first time, the prospect needs to be committed enough to trying yoga that they spend money.
2. Multiple models (pay per use, unlimited usage). Most yoga studios provide different models–in this case, you can pay one price for a single class, a lower price for buying multiple classes up front, and a monthly and annual subscription price. This means that you don't need to commit to becoming a member in order to get access, but you pay a premium for the flexibility. I believe if they made it more obvious who had subscriptions (giving away a cool t-shirt or mat to annual subscribers), it might make subscription membership aspirational.
3. Trial offer to test and encourage habit formation. As with the first lesson full, second lesson free option, having an "unlimited" membership for 10 days, or 10 classes in 10 days free encourages people to get in the habit of visiting a particular yoga studio. Habits are set in 30 days, so the free month is a great way to change behavior.
4. Free coupons for a friend. Viral marketing and word of mouth is great, but sometimes it is hard to get beyond just relying on people to remember to tell their friends. Since yoga is all about the individual experience, there is not an intrinsic motivation to get other people to try the yoga class, as there might be in recruiting team members for a tennis club. Giving away coupons for members to give to friends is a way to encourage word of mouth and create virality in what is not naturally viral.
5. Periodic free classes. While the first four tactics seem to work well–at least, they have worked for me and my friends, and they make logical sense–the last tactic does not seem to work, and I am seeing it offered less frequently–the periodic "free class". What seems to happen when a specific class or day is offered for free is that it attracts a lot of regular customers, in effect, cannibalizing itself. In addition, yoga practitioners who do not usually attend that studio because of distance/convenience issues might be motivated to attend one time because of the price. The incidence of someone who has been "thinking about" yoga actually signing up for a series or membership is very small.
What can we learn from the yoga studio owners? Try lots of different tactics and see what works. Offer subscriptions, but also consider other models for less frequent users. Make sure trials are designed to attract qualified customers? And finally, even yogis need to make a living.
As a special added feature today, I'd like to recommend some of my favorite local studios and instructors. And if you are ever in the mood for a yoga class–drop me a line!
http://www.yogahealthcenter.com Bikram Yoga in San Carlos. Studio owned be Regina who is wonderful!
http://www.yogasanjose Bikram Yoga in San Jose. Studio owned by Michele, who I got to know as a favorite instructor at Yoga Health Center before she opened this lovely studio an hour away (I love my yoga, but not enough to budget 4 hours for a class including round trip).
http://www.yogasource.com in Palo Alto. Broad range of classes with consistently terrific instructors. Home of my current favorite class/teacher, Giselle's Jivamukti class at 9:30AM on Tuesdays.
http://www.devi-yoga.com in Menlo Park. Broad range of classes for all levels and experience. I usually go to the Saturday and Sunday morning classes (shout out to Eric, John, Brandy and Rebecca).
Namaste!
