I had lunch with a friend this afternoon and as we were talking, he starting going on about how expensive his gym membership was. I explained to him that there were a lot of opportunities to exercise for free, but he gave me several compelling reasons why that wouldn’t necessarily work for him:
Seeing as getting him to exercise in a different manner wasn’t an option in this scenario, I said “why don’t we just ask for a better price?” I figured that the same concept of playing the competition off against one another that worked so well getting 50% off cable TV would most likely work the same way with gym memberships. There are a lot of them out there and almost all of them offer introductory rates to try and hook you into their club much like the cable TV companies.
His reply was that when he asked for the promotional rate that his gym was offering, the gym told him that those rates were only available to new customers.
This is a classic mistake when negotiating with these companies. You never want to ask for the promotional rate they are running when you are already a customer or member because they will never give to you. The reason is that they know when you ask that question, there is little risk that they will lose you as a customer. You have not given them an alternative of where you might go and so they will almost always respond exactly as they did to my friend — “sorry, those rates are only for new customers.”
The truth is that those rates aren’t only for new customers. They can be given to anyone if they think that they are going to lose you as a customer. There happened to be a gym nearby where we had met so we went inside and asked for information about their program and if they had any promotional trial periods. They did at a price about $40 less a month than what my friend was paying for his gym membership.
Now that he had the ammunition in his hands (the competing offer), I told him to go to his gym and asked to speak to the manager. Tell her that he really loved the gym, but that the price was a bit too high and he had received the competing offer from the other gym. Was there any way that they could match it.
His biggest fear was that they would refuse and he didn’t want to leave that gym. I explained to never threaten to leave the gym, but simply state that the price is high, you received another offer and is there anything they can do. I explained if they said “no” all he had to say was, “okay, I’ll have to take a couple of days and think about this.”
I received an excited phone call from him this evening saying that he had done as I suggested and received the $40 reduction per month on his gym membership for 3 months without a problem. That is a nice $120 savings and I’d bet he’ll be able to continue to do it in the future as well. Chalk another one up for using competing offers and asking.