What We Can Learn from Other Industries, Part 2

August 4, 2009

This is a regular column in my blog. The idea is that we can learn quite a bit by looking at some of the best practices that other industries have used, that are applicable to the health and wellness industry.

Today we are going to take a closer look at the airline industry and their pricing policies. Specifically I want to take a look at:

• How they price for seats;
• And, the a la carte pricing system they have incorporated.

Differences
One thing about the airline industry that is different from the commercial gym market is that the airline industry is an oligopoly (http://en.wikipedia.org/wiki/Oligopoly), an industry dominated by four or five very large players that will often times move in unison. As an example, when one airline announced they would charge for checked luggage, others quickly followed…I am pretty sure that wouldn’t be the case in our industry!

Similarities
But there are a lot of similarities as well (barely written 10 words and already two lists, I am going to break the world record!)

• A treadmill in one club is the exact same as a treadmill in another club. Similarly a plane ride from Washington to San Diego (the site of the 2010 IHRSA trade show) on United or Southwest or USAir gets you the same result…you get to your destination.
• Comparing prices online between different gyms or airlines is pretty simple and straightforward. For the cost conscious consumer, they are willing to put up with some inconvenience like driving an extra 5 or 10 minutes to go to a less expensive gym or adding a stop in your flight to make it less expensive (I still don’t understand how adding a stop makes it cheaper but maybe someone on an airline blog can address that…)

So what can we learn from the airlines…
Pricing for seats…I think is very similar to pricing for personal training in that airlines charge more for aisle and emergency row so why don’t we charge more for personal training booked during peak times!!! The 5:30-8:30PM time slots are certainly more in demand.

Interestingly, most clubs already allow different pricing for different trainers, this allows you to take it to the next level, and subscribe to the high demands time slots as well.

The same principle can be applied to classes.

Stay tuned for another entry in the series, at a later time…