May 19, 2025 • 15 mins
Is affiliation worth it—or is it just another unnecessary expense?
In this episode of “Run a Profitable Gym,” Chris Cooper breaks down how to measure the true value of an affiliation or licensing agreement, using clear steps and real-world examples from brands such as CrossFit, Hyrox, CNU Stretch and Parisi Speed School.
You’ll learn what affiliation actually gives you (and what it doesn’t), how it compares to franchising and where a brand fits into your gym’s business structure.
Coop introduces a simple ROI formula to help you determine whether affiliation is helping you attract clients, generate revenue and improve retention—or just adding complexity without a clear return.
Whether you’re considering affiliation or questioning the value of your current brand, this episode will help you make a data-driven decision instead of guessing.
Links
Affiliation Comparison Chart
Affiliation Value Formula
Gym Owners United
Book a Call
0:01 - Intro
0:49 - What does affiliation buy?
5:13 - Where a brand fits in your gym
9:01 - How to measure affiliation value
11:07 - Other revenue from affiliation
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_00 (00:00):
Is affiliation really worth it?
I'm Chris Cooper.
This is Run a Profitable Gym.
And today I'm asking thequestion that's on top of a lot
of people's minds right now.
Should I be paying foraffiliation?
And so what I'm going to do isbreak this down to give you a
very clear answer.
And we're going to address thisin three steps.
(00:21):
First is, what are you actuallybuying when you're buying an
affiliation?
And we'll start with that.
Step two, we'll talk about thevalue of a brand in your
business and how it can actuallyfit on top of what you're
currently doing.
And then I'm gonna actually giveyou a formula to measure the
value of paying for differentaffiliations for your gym.
(00:43):
Let's start with what isaffiliation and what is
licensing and what is afranchise and how are they
different?
Let's start with, what are youreally buying when you pay an
affiliation?
In the fitness industry,affiliation is everywhere right
now.
Many gym owners pay to use brandnames in their business title or
for specific programs.
It's a powerful move.
(01:03):
Putting CrossFit on your doortells the world exactly what you
do, and it often brings instantrecognition.
And the same goes for otherbrands.
Putting up a High Rock signshows people that you train and
host High Rock stylecompetitions.
These affiliations giveimmediate clarity to prospects.
Here are a few of the bestaffiliations for microgyms right
(01:24):
now.
First, Hyrox, which I alreadymentioned, at$130 a month
currently, it's very, very easyto make a great return by
offering a special Hyrox programor by running Hyrox events.
The next is CNU Stretch.
After a really minimalinvestment to train your
coaches, the return on this ispotentially enormous.
It's similar to buying a StretchLab franchise, but you can build
(01:46):
this right into your existinggym.
And And you can even listen to apodcast with me and Evans
Armentrading, the founder of CNUStretch on Wednesday.
Another one is Parisi SpeedSchool.
If you want to train youthathletes, a Parisi affiliation
is the gold standard.
And these are very profitablegyms and you don't have to buy a
big, you know, whateverfranchise to train youth
(02:08):
athletes to do it.
Larger gyms, you know, the bigclubs might also license one of
these like Zumba, which lets yourun branded dance fitness
classes with licensedinstructors.
or Les Mills, which is known forbody pump and body combat and
other pre-choreographed groupfitness formats, or TRX.
Maybe you're more familiar withthat.
TRX is Functional FitnessEquipment and Programming, which
(02:31):
is often licensed to gyms forspecialty classes.
You've seen the straps with thehandles.
Now, these are not franchises.
They're license agreements thatlet you use somebody else's
brand in your gym.
CrossFit, of course, is anotherexample of a license agreement.
You can bolt them on to whateveryou're currently doing.
And in some In some cases, theaffiliation creates more revenue
(02:51):
than the gym was doing before oron its own, but none require you
to name the gym a certain way orcarry their brand over yours or
use a specific type ofequipment.
They also come without businesssupport, and that's what Two
Brand is here for.
Affiliates are different fromfranchises.
Affiliates are licensingagreements.
Franchises are expensive tostart with ongoing royalties to
(03:16):
the franchisor.
And many aren't the business ina box that franchises used to
be.
In decades past, franchisesoffered a proven business model
with a full playbook, adedicated territory where
competitors couldn't opennearby, access to a strong brand
identity and nationalrecognition, equipment and
marketing support, training andcertification in delivering the
(03:38):
brand experience.
Fitness franchises like F45, FitBody Bootcamp, Orange Theory,
and Barry's Bootcamp—yep,Barry's is a franchise—they
offer these promises at a cost.
So franchises typically range.
For F45, it's about$50,000 to$100,000 to start.
Fit Body Boot Camp is$30,000 andup.
(03:59):
Orange Theory is about$150,000to$300,000, including your
setup.
And Barry's has an estimatedtotal of investment of about a
half million dollars.
And these high prices once madesense.
You were buying a nearlyguaranteed success.
But today, many of thesefranchises behave more like
licensing agreements.
You pay to use the name, youfollow their instructions, but
(04:21):
you don't always receive therobust playbook or support that
was promised.
It's no longer a guarantee ofsuccess.
Now, by contrast, affiliates arelicensees.
You pay to use the name, but youget minimal support or
instruction.
There's no guarantee of success.
There's usually not a playbook,but you're also not restricted
either.
So let's line these options upfor a quick comparison.
(04:42):
I'll share a little chart here.
And as you can see, there's asliding scale from pure
licensing to full franchisecontrol.
So how do you...
figure out what's best for you.
Is it a franchise?
Is it a license?
Is it an affiliation?
And which one?
Well, if you're watching onYouTube, you can see the chart
here and you can go to the bloglink and you can take a long
(05:03):
look at this chart and you canfigure out like what's the best
for me.
But now the next step is tofigure out what the actual value
of that brand is to yourbusiness.
Before you measure the value ofaffiliation or any brand, you
need to understand where it fitsinto your business.
So think of your business likelike a pyramid, just like
CrossFit's hierarchy of fitness,right?
(05:24):
So the business pyramid startsat the very bottom with your
operating system.
This is like your base layer.
This is how you do your billing,how you do your scheduling, how
you do your payroll, yourcleaning, your session plans,
your staff training, all thefundamentals that really don't
depend on a brand to determinehow you do it.
(05:45):
If you disappear tomorrow, cansomebody run your gym by reading
your playbook?
Do you have those things inplace for your gym?
Do you have the four marketingfunnels?
Do you have referrals?
Do you have organic socialmedia?
Do you have content marketingand paid ads?
These are what bring clients inand you must be able to track
their effectiveness.
Now that marketing is the secondlayer of your pyramid.
(06:06):
It sits on top of your operatingsystems, which is how you run
your gym.
So bottom layer, operatingsystems, next layer, four
marketing funnels.
Above that is your brand, okay?
That's your affiliate or yourlicense.
That's where it lives.
It's the third most importantpart of your business.
It does not determine youroperating systems.
It does not determine yourmarketing.
(06:26):
Your operating systems and yourmarketing will determine how
well you use the brand.
So brand does have help yourother marketing work better, but
it doesn't replace your othermarketing.
Brand gives you a very simpleway to describe what you're
doing.
It's easier to say CrossFit thanit is to say I do constantly
varied functional movementperformed at high intensity with
various equipment and thechanges day to day in a gym that
(06:48):
looks different every single daythat you come in and a fun
loving community that supportsyou on your fitness journey.
That's what the power of branddoes.
It gives you a way to describewhat you're doing in a way that
the listener can immediatelyvisualize.
Now, that is the third mostimportant layer of your
business.
The base is ops.
Then you've got your marketingfunnels.
Then you've got your brand.
Above that, you have yourunmeasurables, your culture,
(07:10):
your relationships, yourcommunity support.
These things drive retention,but they can't be measured.
If you have bad culture, badrelationships, bad community,
that will hurt your business,but it's less clear how you
build those things.
So Thank you.
One important part of that isthat your method, whatever it
is, has to get people results.
That's the non-negotiable partof this unmeasurable piece of
(07:33):
the puzzle.
So before you even ask, isaffiliation worth it?
Should I pay for a brand?
You have to ask, are myoperations solid?
That's the base of your businesspyramid.
Then are my marketing funnelsbuilt and working?
That's the next layer up on yourbusiness pyramid.
Then do I track my leads?
Like, am I good at gettingleads?
Then you say, does my brand...
(07:54):
not the license, but doesCrossFit or does HIROX actually
generate leads and build trustfor my gym?
Now, from there, you can say,all right, now I'm ready for
affiliation, now I'm ready forbranding, and now we can measure
whether affiliation or brandingis right for my gym.
And I'm gonna give you a formulato do that next, but first, I
just wanna hammer home a pointhere.
(08:16):
Your brand, the thing thatyou're licensing, CrossFit, High
Rocks, CNU Stretch, Parisi, LesMills, that is probably not
going to be your marketing.
It's going to make yourmarketing a little bit easier
sometimes.
Sometimes people will actuallylike be searching for CNU
Stretch and find you orsearching for Stretch Lab and
find you.
That's great.
(08:36):
That's a bonus.
But if you're depending on thatfor all of your marketing,
you're in trouble.
You need solid businessoperations first so that you
know that you can retain theclients that you get.
Yet, then you need goodmarketing so that with or
without the brand, you can builda strong business.
And then you pay for the brandto leverage whatever they bring
to the table.
(08:57):
And then finally, you focus onthings like culture and
community.
All right, let's get into theformula to determine whether
affiliation is actually rightfor you.
I wanna break this down intomeasurable steps.
If you want a slowerstep-by-step breakdown, just go
to the blog that's linked in theshow notes and you'll see these
all broken down for you.
So first, step one, check howmany people in your area are
(09:17):
searching for the brand.
Use Google Trends or the keywordplanner tool in Google Ads to
check the city terms.
So you want to search for likeCrossFit near me, your city.
High Rocks gym, your city.
See how often people aresearching for that monthly.
And here's a tip.
If the brand is generating localsearches, it automatically has
(09:38):
value.
Step two is to track your leads.
So every new client that comesinto your gym, you want to ask,
how did you hear about us?
That is so important.
important, and you want torecord their answers
consistently during intake, thatwill tell you which brands or
licenses are actually bringingclients to you.
Step three, this is the hardpart, you're going to calculate
(10:00):
the marketing ROI fromaffiliation.
So here's the formula, number ofleads that you get from that
brand, times the price of yourfront end offer, times 12
months, that's the annual brandvalue.
Okay, so here's an example.
Let's say that you get fiveleads a month from people who
are searching for cross CrossFitnear me or CrossFit in your
city.
And your on-ramp is$500.
(10:20):
So five leads times$500 times 12months is$30,000 a year brand
value.
That's pretty good.
You know, if you're getting fiveleads a month from CrossFit and
those leads are each paying$500when they sign up, 12 months of
the year on average, you'regetting$30,000 in revenue from
paying for CrossFit, which iscosting you$4,500.
(10:40):
That's a great ROI.
You got to sub your own numbersin though.
And if you're not tracking howmany leads you're getting you're
guessing the value of theaffiliation.
We want to be specific.
We want to take control of ourbusiness by actually measuring
these things and doing the mathto figure it out.
Now, if you're getting enoughjust from your front end offer
in attracting new clients andthen buying your on-ramp or
(11:02):
whatever, wonderful, like, youknow, slam dunk, easy choice.
There are other ways that youcan make revenue from your
affiliation.
So for example, if you pay anaffiliation fee to an add-on
service like Hyrox or CNUStretch, then you can measure
the revenue generated from thataffiliation versus the cost.
So here's the formula for thisone.
Revenue from the specialtyservice, let's call it Hyrox,
(11:25):
times the number of times youcan run that service equals
actual brand value.
So here's the example.
Let's say that 15 people sign upfor your Hyrox training program
at 99 bucks a month.
and you run it four times ayear, That gives you 15 people
times$99 times four times ayear, that's 59.40, almost
(11:45):
$6,000, which is amazing ROI forsomething that costs you 130
bucks a month, okay?
So now you can add that to thefront end value of that
affiliation.
And now you can also calculateretention ROI from affiliation.
So this is the trickier one.
It's a little bit more vague,but you can still make it a
mathematical formula.
(12:06):
Again, like this is how you takecontrol of your business and
stop getting guessing, hoping,praying for help by breaking it
down into the numbers.
So let's calculate the retentionvalue of your brand, okay?
So make a list.
Let's use CrossFit as theexample.
How many people signed up forthe CrossFit Open through
CrossFit HQ?
I don't mean your intramuralopen.
(12:27):
I mean they signed up through HQand paid HQ to be part of the
leaderboard, okay?
How many people traveled to theCrossFit Games this year?
how many people talked about orused the workouts from
CrossFit.com.
Then you're going to multiplyeach of those by your monthly
membership rate.
So here's the examplecalculation.
Let's say that four people inyour gym pay$150 a month, that's
(12:50):
your membership, and they jointhe Open.
Okay, that means$600 a year wasthe retention value of paying
for the CrossFit affiliation.
Now, let's say that three morepeople went to the games.
That's$450.
And one on-ramp client came fromthe CrossFit.com website.
So your grand total of all thosethings, people who did the open
(13:11):
and paid HQ, people who went tothe games, people who found you
through the CrossFit.com websiteis$7,050.
So that was$600.
It was$450.
plus$6,000 a year for the clientthat came in and signed up and
stayed for a whole year, okay?
Now, the annual affiliation feefor CrossFit is 4,500 bucks, so
(13:31):
you've got a positive ROI onretention there.
And this is how you break it alldown.
And again, if you want thesecalculations, just click on the
blog link below this video orbelow this podcast so you can
walk through this step-by-step.
This is how you stop guessing.
This is how you take the stressout of all this and just break
it down by the math.
But if you don't track leadsources and you don't sell an
(13:51):
on-ramp or a front-end programand you don't charge extra for
extra things, meaning you addmore programs and more costs and
more complexity and more chaosand more coaching without
attaching any new revenue to it.
And if you don't retain peoplefor 12 months, then the value of
affiliation is gonna be hard tocalculate and it might not be
worth it for you.
(14:12):
And these are, again, becauseyou don't have the base of the
pyramid down.
You're counting on the brand todo everything for you and that's
not its job.
You know, I'm gonna honestly saythat if you don't have operating
systems, the gym can run withoutyou, and four solid marketing
funnels, including a good salesprocess, none of these brands
are going to save you.
And none of them should.
(14:32):
That's not their job.
So Before you de-affiliate,re-affiliate, affiliate, you
also have to know it's gonnacost you to change things no
matter what you do.
But affiliation doesn't meanyou're paying for somebody to
solve your business problems orrun your business for you or
that you're buying a business ina box.
(14:53):
Affiliation means that you'rerenting a brand.
It's up to you to leverage thatbrand and to see a positive
return.
In the old days, Paying for afranchise was a virtual
guarantee of success, but todayyou can be just as profitable
and maintain control of yourbusiness by leveraging licensing
really well.
Now that said, affiliation isnot a silver bullet.
(15:13):
If your operating systems andmarketing and client results
aren't dialed in, then no brandis going to save you.
Get the basics right first andthen measure the brand's
contribution clearly.
The best part, if you're notgetting a great ROI from any of
these brands, affiliations,licenses, you can cancel them
because unlike a big franchise,you're probably not locked into
(15:34):
a 10-year contract.
Hey, it's your business.
Your business is going to changeover time.
You're going to add things,remove things, and change other
things.
A mentor can help you decidewhat to add, what to remove, and
guide you through those changes.
That's the hard part.
I'm Chris Cooper.
This is Run a Profitable Gym,and that's what I want you to
do.
Is affiliation really worth it?
I'm Chris Cooper.
This is Run a Profitable Gym.
And today I'm asking thequestion that's on top of a lot
of people's minds right now.
Should I be paying foraffiliation?
And so what I'm going to do isbreak this down to give you a
very clear answer.
And we're going to address thisin three steps.
(00:21):
First is, what are you actuallybuying when you're buying an
affiliation?
And we'll start with that.
Step two, we'll talk about thevalue of a brand in your
business and how it can actuallyfit on top of what you're
currently doing.
And then I'm gonna actually giveyou a formula to measure the
value of paying for differentaffiliations for your gym.
(00:43):
Let's start with what isaffiliation and what is
licensing and what is afranchise and how are they
different?
Let's start with, what are youreally buying when you pay an
affiliation?
In the fitness industry,affiliation is everywhere right
now.
Many gym owners pay to use brandnames in their business title or
for specific programs.
It's a powerful move.
(01:03):
Putting CrossFit on your doortells the world exactly what you
do, and it often brings instantrecognition.
And the same goes for otherbrands.
Putting up a High Rock signshows people that you train and
host High Rock stylecompetitions.
These affiliations giveimmediate clarity to prospects.
Here are a few of the bestaffiliations for microgyms right
(01:24):
now.
First, Hyrox, which I alreadymentioned, at$130 a month
currently, it's very, very easyto make a great return by
offering a special Hyrox programor by running Hyrox events.
The next is CNU Stretch.
After a really minimalinvestment to train your
coaches, the return on this ispotentially enormous.
It's similar to buying a StretchLab franchise, but you can build
(01:46):
this right into your existinggym.
And And you can even listen to apodcast with me and Evans
Armentrading, the founder of CNUStretch on Wednesday.
Another one is Parisi SpeedSchool.
If you want to train youthathletes, a Parisi affiliation
is the gold standard.
And these are very profitablegyms and you don't have to buy a
big, you know, whateverfranchise to train youth
(02:08):
athletes to do it.
Larger gyms, you know, the bigclubs might also license one of
these like Zumba, which lets yourun branded dance fitness
classes with licensedinstructors.
or Les Mills, which is known forbody pump and body combat and
other pre-choreographed groupfitness formats, or TRX.
Maybe you're more familiar withthat.
TRX is Functional FitnessEquipment and Programming, which
(02:31):
is often licensed to gyms forspecialty classes.
You've seen the straps with thehandles.
Now, these are not franchises.
They're license agreements thatlet you use somebody else's
brand in your gym.
CrossFit, of course, is anotherexample of a license agreement.
You can bolt them on to whateveryou're currently doing.
And in some In some cases, theaffiliation creates more revenue
(02:51):
than the gym was doing before oron its own, but none require you
to name the gym a certain way orcarry their brand over yours or
use a specific type ofequipment.
They also come without businesssupport, and that's what Two
Brand is here for.
Affiliates are different fromfranchises.
Affiliates are licensingagreements.
Franchises are expensive tostart with ongoing royalties to
(03:16):
the franchisor.
And many aren't the business ina box that franchises used to
be.
In decades past, franchisesoffered a proven business model
with a full playbook, adedicated territory where
competitors couldn't opennearby, access to a strong brand
identity and nationalrecognition, equipment and
marketing support, training andcertification in delivering the
(03:38):
brand experience.
Fitness franchises like F45, FitBody Bootcamp, Orange Theory,
and Barry's Bootcamp—yep,Barry's is a franchise—they
offer these promises at a cost.
So franchises typically range.
For F45, it's about$50,000 to$100,000 to start.
Fit Body Boot Camp is$30,000 andup.
(03:59):
Orange Theory is about$150,000to$300,000, including your
setup.
And Barry's has an estimatedtotal of investment of about a
half million dollars.
And these high prices once madesense.
You were buying a nearlyguaranteed success.
But today, many of thesefranchises behave more like
licensing agreements.
You pay to use the name, youfollow their instructions, but
(04:21):
you don't always receive therobust playbook or support that
was promised.
It's no longer a guarantee ofsuccess.
Now, by contrast, affiliates arelicensees.
You pay to use the name, but youget minimal support or
instruction.
There's no guarantee of success.
There's usually not a playbook,but you're also not restricted
either.
So let's line these options upfor a quick comparison.
(04:42):
I'll share a little chart here.
And as you can see, there's asliding scale from pure
licensing to full franchisecontrol.
So how do you...
figure out what's best for you.
Is it a franchise?
Is it a license?
Is it an affiliation?
And which one?
Well, if you're watching onYouTube, you can see the chart
here and you can go to the bloglink and you can take a long
(05:03):
look at this chart and you canfigure out like what's the best
for me.
But now the next step is tofigure out what the actual value
of that brand is to yourbusiness.
Before you measure the value ofaffiliation or any brand, you
need to understand where it fitsinto your business.
So think of your business likelike a pyramid, just like
CrossFit's hierarchy of fitness,right?
(05:24):
So the business pyramid startsat the very bottom with your
operating system.
This is like your base layer.
This is how you do your billing,how you do your scheduling, how
you do your payroll, yourcleaning, your session plans,
your staff training, all thefundamentals that really don't
depend on a brand to determinehow you do it.
(05:45):
If you disappear tomorrow, cansomebody run your gym by reading
your playbook?
Do you have those things inplace for your gym?
Do you have the four marketingfunnels?
Do you have referrals?
Do you have organic socialmedia?
Do you have content marketingand paid ads?
These are what bring clients inand you must be able to track
their effectiveness.
Now that marketing is the secondlayer of your pyramid.
(06:06):
It sits on top of your operatingsystems, which is how you run
your gym.
So bottom layer, operatingsystems, next layer, four
marketing funnels.
Above that is your brand, okay?
That's your affiliate or yourlicense.
That's where it lives.
It's the third most importantpart of your business.
It does not determine youroperating systems.
It does not determine yourmarketing.
(06:26):
Your operating systems and yourmarketing will determine how
well you use the brand.
So brand does have help yourother marketing work better, but
it doesn't replace your othermarketing.
Brand gives you a very simpleway to describe what you're
doing.
It's easier to say CrossFit thanit is to say I do constantly
varied functional movementperformed at high intensity with
various equipment and thechanges day to day in a gym that
(06:48):
looks different every single daythat you come in and a fun
loving community that supportsyou on your fitness journey.
That's what the power of branddoes.
It gives you a way to describewhat you're doing in a way that
the listener can immediatelyvisualize.
Now, that is the third mostimportant layer of your
business.
The base is ops.
Then you've got your marketingfunnels.
Then you've got your brand.
Above that, you have yourunmeasurables, your culture,
(07:10):
your relationships, yourcommunity support.
These things drive retention,but they can't be measured.
If you have bad culture, badrelationships, bad community,
that will hurt your business,but it's less clear how you
build those things.
So Thank you.
One important part of that isthat your method, whatever it
is, has to get people results.
That's the non-negotiable partof this unmeasurable piece of
(07:33):
the puzzle.
So before you even ask, isaffiliation worth it?
Should I pay for a brand?
You have to ask, are myoperations solid?
That's the base of your businesspyramid.
Then are my marketing funnelsbuilt and working?
That's the next layer up on yourbusiness pyramid.
Then do I track my leads?
Like, am I good at gettingleads?
Then you say, does my brand...
(07:54):
not the license, but doesCrossFit or does HIROX actually
generate leads and build trustfor my gym?
Now, from there, you can say,all right, now I'm ready for
affiliation, now I'm ready forbranding, and now we can measure
whether affiliation or brandingis right for my gym.
And I'm gonna give you a formulato do that next, but first, I
just wanna hammer home a pointhere.
(08:16):
Your brand, the thing thatyou're licensing, CrossFit, High
Rocks, CNU Stretch, Parisi, LesMills, that is probably not
going to be your marketing.
It's going to make yourmarketing a little bit easier
sometimes.
Sometimes people will actuallylike be searching for CNU
Stretch and find you orsearching for Stretch Lab and
find you.
That's great.
(08:36):
That's a bonus.
But if you're depending on thatfor all of your marketing,
you're in trouble.
You need solid businessoperations first so that you
know that you can retain theclients that you get.
Yet, then you need goodmarketing so that with or
without the brand, you can builda strong business.
And then you pay for the brandto leverage whatever they bring
to the table.
(08:57):
And then finally, you focus onthings like culture and
community.
All right, let's get into theformula to determine whether
affiliation is actually rightfor you.
I wanna break this down intomeasurable steps.
If you want a slowerstep-by-step breakdown, just go
to the blog that's linked in theshow notes and you'll see these
all broken down for you.
So first, step one, check howmany people in your area are
(09:17):
searching for the brand.
Use Google Trends or the keywordplanner tool in Google Ads to
check the city terms.
So you want to search for likeCrossFit near me, your city.
High Rocks gym, your city.
See how often people aresearching for that monthly.
And here's a tip.
If the brand is generating localsearches, it automatically has
(09:38):
value.
Step two is to track your leads.
So every new client that comesinto your gym, you want to ask,
how did you hear about us?
That is so important.
important, and you want torecord their answers
consistently during intake, thatwill tell you which brands or
licenses are actually bringingclients to you.
Step three, this is the hardpart, you're going to calculate
(10:00):
the marketing ROI fromaffiliation.
So here's the formula, number ofleads that you get from that
brand, times the price of yourfront end offer, times 12
months, that's the annual brandvalue.
Okay, so here's an example.
Let's say that you get fiveleads a month from people who
are searching for cross CrossFitnear me or CrossFit in your
city.
And your on-ramp is$500.
(10:20):
So five leads times$500 times 12months is$30,000 a year brand
value.
That's pretty good.
You know, if you're getting fiveleads a month from CrossFit and
those leads are each paying$500when they sign up, 12 months of
the year on average, you'regetting$30,000 in revenue from
paying for CrossFit, which iscosting you$4,500.
(10:40):
That's a great ROI.
You got to sub your own numbersin though.
And if you're not tracking howmany leads you're getting you're
guessing the value of theaffiliation.
We want to be specific.
We want to take control of ourbusiness by actually measuring
these things and doing the mathto figure it out.
Now, if you're getting enoughjust from your front end offer
in attracting new clients andthen buying your on-ramp or
(11:02):
whatever, wonderful, like, youknow, slam dunk, easy choice.
There are other ways that youcan make revenue from your
affiliation.
So for example, if you pay anaffiliation fee to an add-on
service like Hyrox or CNUStretch, then you can measure
the revenue generated from thataffiliation versus the cost.
So here's the formula for thisone.
Revenue from the specialtyservice, let's call it Hyrox,
(11:25):
times the number of times youcan run that service equals
actual brand value.
So here's the example.
Let's say that 15 people sign upfor your Hyrox training program
at 99 bucks a month.
and you run it four times ayear, That gives you 15 people
times$99 times four times ayear, that's 59.40, almost
(11:45):
$6,000, which is amazing ROI forsomething that costs you 130
bucks a month, okay?
So now you can add that to thefront end value of that
affiliation.
And now you can also calculateretention ROI from affiliation.
So this is the trickier one.
It's a little bit more vague,but you can still make it a
mathematical formula.
(12:06):
Again, like this is how you takecontrol of your business and
stop getting guessing, hoping,praying for help by breaking it
down into the numbers.
So let's calculate the retentionvalue of your brand, okay?
So make a list.
Let's use CrossFit as theexample.
How many people signed up forthe CrossFit Open through
CrossFit HQ?
I don't mean your intramuralopen.
(12:27):
I mean they signed up through HQand paid HQ to be part of the
leaderboard, okay?
How many people traveled to theCrossFit Games this year?
how many people talked about orused the workouts from
CrossFit.com.
Then you're going to multiplyeach of those by your monthly
membership rate.
So here's the examplecalculation.
Let's say that four people inyour gym pay$150 a month, that's
(12:50):
your membership, and they jointhe Open.
Okay, that means$600 a year wasthe retention value of paying
for the CrossFit affiliation.
Now, let's say that three morepeople went to the games.
That's$450.
And one on-ramp client came fromthe CrossFit.com website.
So your grand total of all thosethings, people who did the open
(13:11):
and paid HQ, people who went tothe games, people who found you
through the CrossFit.com websiteis$7,050.
So that was$600.
It was$450.
plus$6,000 a year for the clientthat came in and signed up and
stayed for a whole year, okay?
Now, the annual affiliation feefor CrossFit is 4,500 bucks, so
(13:31):
you've got a positive ROI onretention there.
And this is how you break it alldown.
And again, if you want thesecalculations, just click on the
blog link below this video orbelow this podcast so you can
walk through this step-by-step.
This is how you stop guessing.
This is how you take the stressout of all this and just break
it down by the math.
But if you don't track leadsources and you don't sell an
(13:51):
on-ramp or a front-end programand you don't charge extra for
extra things, meaning you addmore programs and more costs and
more complexity and more chaosand more coaching without
attaching any new revenue to it.
And if you don't retain peoplefor 12 months, then the value of
affiliation is gonna be hard tocalculate and it might not be
worth it for you.
(14:12):
And these are, again, becauseyou don't have the base of the
pyramid down.
You're counting on the brand todo everything for you and that's
not its job.
You know, I'm gonna honestly saythat if you don't have operating
systems, the gym can run withoutyou, and four solid marketing
funnels, including a good salesprocess, none of these brands
are going to save you.
And none of them should.
(14:32):
That's not their job.
So Before you de-affiliate,re-affiliate, affiliate, you
also have to know it's gonnacost you to change things no
matter what you do.
But affiliation doesn't meanyou're paying for somebody to
solve your business problems orrun your business for you or
that you're buying a business ina box.
(14:53):
Affiliation means that you'rerenting a brand.
It's up to you to leverage thatbrand and to see a positive
return.
In the old days, Paying for afranchise was a virtual
guarantee of success, but todayyou can be just as profitable
and maintain control of yourbusiness by leveraging licensing
really well.
Now that said, affiliation isnot a silver bullet.
(15:13):
If your operating systems andmarketing and client results
aren't dialed in, then no brandis going to save you.
Get the basics right first andthen measure the brand's
contribution clearly.
The best part, if you're notgetting a great ROI from any of
these brands, affiliations,licenses, you can cancel them
because unlike a big franchise,you're probably not locked into
(15:34):
a 10-year contract.
Hey, it's your business.
Your business is going to changeover time.
You're going to add things,remove things, and change other
things.
A mentor can help you decidewhat to add, what to remove, and
guide you through those changes.
That's the hard part.
I'm Chris Cooper.
This is Run a Profitable Gym,and that's what I want you to
do.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
The Joe Rogan Experience
The official podcast of comedian Joe Rogan.
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.