Try the #1 software for $1/month.
Norem ipsum dolor sit amet, consectetur adipiscing elit. Etiam eu turpis molestie, dictum est a, mattis tellus. Sed dignissim, metus nec accumsan.
You’ve got a full class schedule and a community you’re proud of. But you’ve also got a full plate and lots of items on your to-do list that are designed to boost your boutique studio growth.
The question is: do you know which KPIs will move the needle for your studio, so you can prioritize the tasks that will get you there? Because “pulling reports” shouldn’t just be another thing to check off. It should be your snapshot for what’s working, and what needs improvement.
We already know you’ve got great instinct and business savvy. But guessing (or worse, trying to “do more”) isn’t the answer. Boutique studio growth comes from knowing which things are working, doubling down on those things, and cutting anything that’s not beneficial.
This all starts with tracking the right KPIs across three areas: revenue, retention, and operations.
Revenue KPIs: The Real Story of Boutique Studio Growth
Here are the relevant revenue-related KPIs for you to start tracking today:
Monthly Recurring Revenue (MRR)
When memberships are the core service you offer, MRR is your key metric. It’s the predictable, subscription-based revenue coming in specifically from memberships each month. This does not include other services like personal training, or other revenue like class packs or retail sales.
When tracking, in addition to looking at each month on its own, be sure to note trending direction. For example, let’s look at two studios that are both doing $20k in MRR. If the first went from $15k to $18k and then $20k, it’s in a significantly different position than one that went from $40k to $30k to $20k. Downward trends could simply be seasonal, in which case you know they’ll eventually trend upward. But if they’re unexpected or unusual, aim to pinpoint the source so you can change the direction of the trend.
Average Revenue Per Member (ARM)
Average revenue per member is calculated by dividing total monthly revenue by the number of active members you have.
On the surface, if you look around your space and see full classes, it seems logical to assume your boutique studio growth is on track. However, ARM shows you exactly how much each person is contributing to your business each month, which can help you make smarter business decisions. As an example, your ARM might be dropping while membership count holds steady. That could indicate a need for improvement in the products or services you’re offering, or even your pricing structure.
Average Revenue Per Class (ARC)
Average Revenue Per Class is an often-overlooked metric that packs a big punch. Start by dividing your total class revenue (for most studios, this is your MRR plus any class package revenue) by the number of classes you ran that month. If you’re offering 30 classes each week and most of them are only half-full, your ARC will emphasize exactly how much underutilization might be costing you.
Ultimately, boutique studio growth comes down to matching supply with demand. You want to provide the right number of well-attended classes, versus a full schedule of empty ones.
Lead-to-Member Conversion Rate
Leads are an essential part of your studio growth. But focusing on lead volume alone doesn’t automatically mean more members. The truth is, there are three stages for each lead:
- Finding your business and booking their first visit (e.g. no sweat intro, first free class, etc.)
- Showing up for that first visit
- Conversion (signing up or becoming a member)
By measuring these KPIs, you can find your weakest link and start there. For example, if people are booking an appointment but not showing up, perhaps the automated workflows for lead nurture need to be refined. And that could be as simple as improving brand voice or increasing the cadence of your appointment reminders.
Tracking this flow of stages not only shows you that a problem exists, but where it is, so you can fix it.
Retention KPIs: Separating Growing Studios From Stagnant Ones
Here are the relevant retention-related KPIs for you to start tracking today:
Member Churn Rate (aka the Boutique Studio Growth Blocker)
Churn rate is the percentage of members who cancel in a given month. For most boutique studios, anything above 5-6% is a sign that there’s room for improvement. The key is to figure out where it’s coming from. It could be due to things like workout programming, a disconnected community, member frustration, etc.
It’s not uncommon for higher churn to happen during the summer months or around the holidays. But the longer you track this metric, the easier it will be to see less-predictable churn trends, and pivot as needed.
Length of Engagement (LEG)
The length of engagement is the average length of time that people are members of your studio. While churn can show you how many people are canceling, LEG shows you how long they were a part of your community.
When you segment your churn data by length, it allows you to see even more opportunities for improvement. For example, if your studio loses the most members after 24 months, that’s a different issue to tackle than one that loses members after 90 days. The first could be something like results plateauing, while the second could require better onboarding.
Visit Frequency
For boutique studio growth, this is a big one because it can give you one of the clearest pre-churn warning signals. It’s both obvious and worth noting that members with two or more check-ins per week are significantly less likely to cancel than those who check in once per week or less. It’s pretty simple: check-ins usually translate to results, and that’s what they came to you for in the first place.
This is why things like Committed Crew and Weekly Streaks are such powerful tools for increasing retention. And the great news is that you can use automated workflows that are triggered when someone doesn’t show up for a certain amount of time. For example, if Jenny hasn’t been to your studio in 10 days, she’ll receive a text aimed at getting her back in the door.
Satisfaction Rating (a Predictor for Boutique Studio Growth)
How satisfied are your members? Sure, the answer could come from your gut feeling. But what if you asked them? A simple question about the likelihood (on a scale of 1 to 10) that they’d recommend your studio to a friend can provide some powerful answers for your boutique studio growth.
First, their answer will usually lead to an explanation of why they chose it.
“Ten out of ten because I love this place. The workouts are great and I love my gym community.” Or, “Three. I’m lacking motivation and I wish you offered nutrition coaching.” Both answers are helpful for your next business moves. And there’s a good chance that this answer correlates to how successful your studio’s referral program is as well.
Operations KPIs that Promote Boutique Studio Growth
Here are the relevant operations-related KPIs for you to start tracking today:
Staff Utilization Rate
Have you ever thought about the revenue generated by the hours your staff is putting in? Revenue-generating hours could be things like coaching classes or selling memberships. On the other hand, admin, cleaning, or even standing around on the clock are are all non-revenue-generating hours.
Let’s say Susan is a part-time instructor at your studio with 30 hours per week. She coaches 12 classes per week, handles admin tasks for 10, and cleans for three. Those five hours in between tasks? She kind of just wanders around looking for things to do. You’re paying for that but not generating any revenue. Auditing your staff utilization rate can help you pinpoint leaky holes in your operations expenses bucket.
Class Fill Rate
Class fill rate is the percentage of your available class spots that are actually filled across your weekly schedule. Healthy boutique studio growth will usually reflect about 70-80% fill rate, on average. If your studio is consistently below that, you might be offering too many classes. Conversely, if you’re consistently above 90%, you might be leaving growth on the table by not adding classes.
Breaking down your class fill rate by time slot, day of the week, and even who’s coaching can help you make smarter scheduling decisions. Instead of just guessing about better options, use the data to point you in the right direction.
Cost Per Acquisition (CPA)
Do you know how much you’re spending to bring in one new member, on average? This cost combines anything from ad spend to referral incentives, trial offers or discounts.
You can compare this number to your average lifetime value, which is the total amount someone spends with you the entire time they’re a member. For example, let’s say it costs you $150 to acquire a member who stays for 14 months. If they pay $150/month, refer friends and purchase retail items, you’re in good shape. However, if it costs you $300 to acquire someone who churns after 45 days, this metric can be your sign to fix retention before you focus on acquisition.
Cost of Admin Time Spent
The cost of admin work can wreak havoc on your bottom line if you don’t have gym software that can handle it for you. From billing to scheduling and updating member payments, let the technology handle the workload for you.
Did you know that Wodify boutique studio owners save more than 10 hours per week simply by using the software effectively to buy their time back? If you want to find out more about how to do this in your studio, book a demo with the Wodify team today.
Turning Numbers Into Boutique Studio Growth
The most successful boutique studios aren’t necessarily tracking every metric in every category. So don’t be overwhelmed with analysis paralysis. For boutique studio growth, start with a few KPIs that you think will reflect the health of your business, and move the needle. Track them consistently, then make smart business decisions based on the data.
Need a suggestion? Start with conversion rate, MRR, churn rate, and visit frequency. These four metrics will help you with a high-level view of revenue, retention and operations. Once you have a baseline, keep tracking monthly and use the data to improve over time. Then add in other metrics as you’re able.
Ultimately, boutique studio growth isn’t a mystery. It’s using the numbers to improve consistently for the long run.
Pro Tip: Wodify gives boutique studio owners real-time access to the KPIs that matter most, built into the same platform you’re already using to manage members, billing, and classes. If you’re tired of pulling numbers from four different places, we’d love to show you what it looks like when everything lives in one place.
