Lifetime Fitness 2006 Annual Report Download - page 15

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Membership
Our month-to-month membership plans typically include 24-hour access, free locker and towel service, a full range
of educational programs and other premium amenities. Moreover, we offer an initial 30-day money back guarantee
on upfront membership enrollment fees and the first month’s membership dues, which is a longer period than
required by state law and longer than offered by most other health clubs. We believe our customer service, broad
appeal to multiple family members and attractive value proposition are key to our membership growth. We
continually monitor member satisfaction through phone and online surveys, secret shoppers and roundtable forums
that enable us to collect feedback from our members and incorporate that feedback into our offerings.
As part of our value proposition, our new members may take advantage of equipment orientations and participate in
a fitness assessment, which consists of fitness testing, exercise history, percent body fat measurement and goal
setting. Fitness clinics on different types of workouts and other courses in nutrition and stress management are also
offered free of charge.
We have a flexible membership structure, which includes different types of membership plans, the most common of
which are the Fitness and Sports plans. Our Fitness membership plan is our standard plan and offers a member
access to the majority of our centers. Our Sports membership plan offers all the benefits of our Fitness membership,
plus access to all but our nine Advantage and Athletic centers, while also offering discounts on our other in-center
services and third-party facilities, such as participating golf courses, ski resorts and tennis clubs throughout the
nation. In addition, the Sports membership plan entitles a member to free use of the center’s racquetball and squash
courts and climbing walls. In 2006, we introduced the Advantage membership which offers all the benefits of the
Sports membership, plus access to all Fitness, Sports and Advantage centers as well as tennis access in Fitness,
Sports and Advantage centers where available. Our Athletic membership includes all of the amenities of the
Advantage membership plus access to all Fitness, Sports, Advantage and Athletic centers as well as unlimited and
free tennis access in all centers with tennis facilities and unlimited yoga. In certain centers we also offer an Express
membership plan from time to time, which has lower membership dues than our Fitness membership plan, but
restricts access to a single center and does not include a subscription to Experience Life magazine or access to the
child center.
We have always offered a convenient month-to-month membership, with no long-term contracts, a low, one-time
enrollment fee and an initial 30-day money back guarantee. Depending upon the market area and the membership
plan, new members typically pay a one-time enrollment fee of $99 to $259 for individual members, plus $60 to $100
for each additional family member over the age of 12. Members typically pay monthly membership dues ranging
from $50 to $60 for individuals and $90 to $130 for couples or families for Fitness or Sports memberships. In
addition, new members pay a $5 per child monthly fee to include junior members on a membership. Our current
model centers average approximately 2.4 people per membership.
Usage
Our centers are generally open 24 hours a day, seven days a week and our current model centers average
approximately 68,000 visits per month. We typically experience the highest level of member activity at a center
during the 5:00 a.m. to 11:00 a.m. and 4:00 p.m. to 8:00 p.m. time periods on weekdays and during the 8:00 a.m. to
5:00 p.m. time period on weekends. Our centers are staffed accordingly to provide each member with a positive
experience during peak and non-peak hours.
New Center Site Selection and Construction
Site Selection. Our management devotes significant time and resources to analyzing each prospective site on the
basis of predetermined physical, demographic, psychographic and competitive criteria in order to achieve maximum
return on our investment. Our ideal site for a current model center is a tract of land with at least 10 acres and a
relatively flat topography affording good access and proper zoning. We typically target market areas that have at
least 150,000 people within a trade area that meet certain demographic criteria regarding income, education, age and
household size. Two of the centers we plan to open in 2008 will adapt our current model center to more densely
developed trade areas that meet our demographic criteria. We focus mainly on markets that will allow us to operate
multiple centers that create certain efficiencies in marketing and branding activities; however, we select each site
based on whether that site can support an individual center on a stand-alone basis.