An independent gym chain: 3,400 renewals processed without a reminder call
An independent gym chain across the East Midlands was renewing 3,400 memberships a year by phone. The membership team made the calls; the churn rate suggested the calls were not helping.
The reading
Five sites across Derby, Nottingham, and Leicester, around 7,200 members, a membership team of nine. Memberships ran on annual terms with a mix of direct debit and card payment. Renewal was handled by phone call in the four weeks before expiry; the membership team made roughly 70 calls a day, in rotation across sites.
The renewal rate was 72%, which the directors had decided was acceptable. The membership team's attrition rate, which they regarded as separate, was 40% a year. The calls were, by common agreement, dispiriting work.
We had suggested, in the first conversation, that the two numbers might be related.
The call that no one wanted
The renewal call was unpleasant for everyone. The member had, in many cases, already decided whether to renew. The caller was interrupting them to ask. A proportion of calls caught people at bad moments and resulted in a cancellation that might not otherwise have happened.
The membership team's internal view was that the call was "the price of a renewal". We thought the call was often the opposite: the thing that caused the non-renewal.
- 7,200 members, 3,400 renewals per year
- ~70 phone calls per day in rotation
- 72% renewal rate, flat for four years
- 40% annual attrition in the membership team
- No prior test of a non-call-based renewal flow
What we built
We built a renewal flow that defaulted to automatic. Members on direct debit were renewed automatically unless they opted out, with a clear notice sent six weeks before, four weeks before, and one week before. Members on card payment received a secure link to confirm renewal in two taps on their phone. The membership team only called people who had actively indicated hesitation (opening the email three times without acting, say) or whose payment had failed.
The technical detail worth recording: the opt-out was deliberately easy. We put a prominent "don't renew me" link in every notice. We expected the renewal rate to drop. It rose. The members who would have cancelled on a phone call often did not cancel through the opt-out link; it turned out that the phone call had been talking some of them into leaving.
Stack: a Rails application integrated with GoCardless and Stripe, Postmark for email, a lightweight web confirmation flow, a dashboard for the membership team.
The numbers at ninety days
| What | Before | After |
|---|---|---|
| Renewal rate | 72% | 81% |
| Renewal calls made | 70/day | 11/day |
| Membership team weekly hours on calls | 320 | 55 |
| Payment failures recovered | 48% | 86% |
| Member complaints about renewal process | 14/month | 2/month |
The call was the problem
The membership team now spends its time on acquisition, on-site hospitality, and the small number of hesitant members who genuinely benefit from a conversation. Attrition on the team dropped in the first year. The renewal rate went up for the same reason it went up: people who wanted to stay were allowed to stay without being talked out of it.
The system-first position is sometimes uncomfortable. We did not add a system; we removed a process. The one-week training test here is slightly inverted: a new member of the team can do their job in a week because the job no longer consists of making a call no one wanted.