Why your gym is quietly fine with you staying home

Your gym is quietly fine with you staying home because your fee turns up even when you don't, and it can sell more memberships than its floor could ever hold. I don't find that sinister. But I should say that my best evidence is American and old, because I couldn't find a Malaysian gym publishing how often its members come.

The awkward American study

Two economists, Stefano DellaVigna and Ulrike Malmendier, got hold of the records of three US clubs, covering 7,752 members around the turn of the century. Nobody's fees look like that any more, but I doubt people have changed much.

Members on a monthly plan of over US$70 went about 4.3 times a month.¹

So each visit cost them more than US$17, when a pass for ten visits at the same clubs worked out at US$10.¹

Over a whole membership, the average member on that plan gave up about US$600 in savings, out of about US$1,400 paid.¹ Nobody was forced into it. They'd simply bought the plan for someone who went more often than they did.

Visits a month, hoped for and actual

That gap is the part I keep thinking about. The authors' leading explanation is overconfidence, about future self-control or future efficiency, which is a polite way of describing every January. They also say persuasion by club staff could explain most of the same findings, so I can't pin it all on optimism.

My favourite detail is the contract nobody would pick on paper. Monthly members were 17% more likely to still be enrolled after a year than people who'd committed to a year.¹ So the plan built for easy leaving kept people longer, and charged them extra for an exit they weren't using.

Stopping isn't the same as cancelling

Stopping going and stopping paying turned out to be two separate events in that study, and the gap between them was worth real money.

How a monthly membership winds down

On average, 2.31 full months passed between a monthly member's last visit and the end of the contract, at a cost of US$187.¹ Cancelling took a letter or a trip to the club, and the authors reckon that effort was probably worth less than US$15.¹

I don't think those people forgot. My guess is that they were going back on Monday, every Monday, for two months.

Why the floor doesn't burst

Here's the other half of it. One big American chain reported about 19.7 million members across 2,722 clubs. By my division, that's roughly 7,200 members a club.²

No club I can picture holds that many people on one evening, so it must be counting on most of them being elsewhere. It's a different sort of operation from most gyms here, I'd guess, so I wouldn't lean on it too hard.

What I wanted was the Malaysian version: how many members turn up, and what a gym keeps. I couldn't find a number for either. So nothing below is a claim about any Malaysian gym's books.

Here, the bet can run the other way

Those American members could at least leave at the end of any month. Pay a big sum upfront and the risk swaps sides, because now you're the one trusting the business to still be there.

In June 2017, one chain closed all its Malaysian gyms, telling members by email and saying operations were no longer financially viable. The minister pointed them to the consumer claims tribunal, where the ceiling was then RM25,000.³ He said members who'd paid more than that couldn't be made whole.

That ceiling has since doubled. The tribunal told The Star the limit went up to RM50,000 under a 2019 amendment, so I'd check that figure before assuming anything older.

A closure isn't the only way to fall out, either. In 2020, more than 30 members of one gym franchise filed tribunal cases, saying their life memberships had ended over late yearly payments.⁴ They'd reportedly paid up to RM11,000 about a decade earlier, and the report carried no reply from the gym.⁴

What I'd do with this

If I owned a gym, I wouldn't treat the quiet member as free money. A member who's stopped coming looks to me like a cancellation that hasn't happened yet, so I'd spend my effort on them before the Monday plan runs out.

If I were the member, I'd do one small sum: what I paid over the past few months, divided by the visits I actually made. If the answer is more than a day pass would cost, I already know which plan I'm really on.

And I don't think that makes the absent member a fool, or the gym a villain. Both of them signed up hoping for someone fitter, and only one of them gets paid either way.