The cost of recruiting new members versus retaining existing ones

“Make new friends but keep the old. One is silver and the other is gold.” It turns out these classic children’s song lyrics have good advice when it comes to customer recruitment and retention strategies. Bringing in new customers is great, but you’re golden if you can retain your existing customers.

According to 2019 data from the International Health, Racquet and Sportsclub Association (IHRSA), nearly 29 out of 100 members are expected to cancel their gym memberships each year. While leading clubs today spend a median of $66.48 in sales and marketing costs per new membership account, in 2011, the median cost per new member account was $103.50.

Though the cost of sales and marketing per each new member has decreased over the years, according to IHRSA, the cost of recruiting a new member still is more than twice the cost of retaining an existing member. When an existing member leaves, it can cost a club as much as $674 in annual revenue per dropped account.