Planet Fitness Increases Basic Membership Price
National gym chain Planet Fitness is hiking the cost of its basic membership for the first time in 26 years.
A no-frills membership for new customers will now cost $15 per month, up from the long-standing price of $10 set in 1998. This price adjustment will take effect during the upcoming summer. Existing members who signed up at the $10 per month rate will maintain that price until their membership expires, as confirmed by the fitness company during its first quarter earnings call on Thursday.
The company's price increase is specifically targeted at its lowest tier or "classic" membership, which grants access to a single gym location.
"It will take some time for the benefit of the price change to expand our store level margins as the price increase will only be on new classic card memberships," stated Planet Fitness CFO Tom Fitzgerald, who is set to retire in August, during the earnings call.
This membership fee adjustment comes in the midst of "several headwinds" impacting the company's financial performance. Executives acknowledged challenges such as consumer focus on saving money, COVID-related concerns, and an unsuccessful advertising campaign.
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For a fixed fee of $25 a month, members of Planet Fitness' "Black Club" have the flexibility to work out at multiple facilities; with over 60% of the company's members opting for the "Black Card" tier.
The 50% increase in price follows cost testing in various markets. "We utilize a data-driven strategy to determine the optimal balance between higher dues and minimizing membership loss. Based on our findings, we have chosen to adjust the price of the classic card to $15," stated PlanetFitness CEO Craig Benson during the earnings call.
The company is planning to conduct similar price experiments for the Black Card membership.
On the opposite end of the spectrum, luxury fitness brand Equinox introduced an ultra-premium program this week for fitness enthusiasts, priced at a minimum of $40,000 annually.
