The Challenge

Like most gyms, FitHub YYC faced a common problem: the January fitness rush brings excitement, but how do you turn that seasonal interest into long-term members?

Traditional gym marketing is expensive. Industry benchmarks show:

• Average customer acquisition cost: $100-$300 per member
• 50% of new members quit within 6 months
• The cost to acquire a new customer is 5x higher than retaining one

FitHub needed a strategy that would not only attract new members during peak season but do so cost-effectively while building long-term value.

The Campaign: Win a Year of Fitness

Campaign Period: December 1, 2025 - January 31, 2026

The Offer:A raffle-style contest where participants earned entries based on their commitment level:

• Free Trial signup: 1 entry
• Monthly Membership: 5 entries
• Annual Membership (12-month contract): 20 entries

Grand Prize: One year of unlimited FitHub membership

Why This Works:The tiered entry system incentivized higher-value conversions. Someone serious about winning would be motivated to commit to an annual membership for better odds—exactly the type of long-term customer FitHub wanted.

The Marketing Strategy

Total Ad Spend: CA$2,963.42

Platform Breakdown:

• Meta Ads: CA$1,181.09
• Google Ads: CA$1,782.33

Why These Channels?

Meta (Facebook/Instagram):

• Great for brand awareness and visual storytelling
• Ability to target local Calgary residents interested in fitness
• Strong social proof through shares and engagement

Google Ads:

• Captures high-intent search traffic ("gyms near me", "Calgary fitness")
• Targets people actively looking for fitness solutions
• Excellent for converting people already in "decision mode"

The Results

By The Numbers:

Total Participants: 165 people

• 118 free trial signups
• 58 converted to paying members (49.2% conversion rate!)
  • 23 annual members (12-month contracts)
  • 35 monthly members (month-to-month)

Campaign Costs:

• Ad Spend: CA$2,963.42
• Prize Value (1-year membership): CA$1,533.96
• Total Investment: CA$4,497.38

Revenue Generated: CA$74,453.19

Net Profit: CA$69,955.81

ROI: 1,555% (16.6x return on investment)

Breaking Down the Math: Understanding LTV and CAC

Full transparency: When we first looked at these numbers, they seemed too good to be true. Let's walk through the math step-by-step so you can verify it yourself.

What is Customer Acquisition Cost (CAC)?

CAC = Total Marketing Spend ÷ Number of New Customers

For FitHub:

• Total Campaign Cost: CA$4,497.38
• New Members Acquired: 58
• CAC = CA$77.54 per member

Industry Benchmark: $66-300 per member

✅ FitHub's Performance: Right in the sweet spot, and on the lower end of the average range.

What is Lifetime Value (LTV)?

LTV is the total revenue you expect to generate from a customer over their entire relationship with your business.

Formula: Monthly Revenue per Member × Average Membership Length

Here's where we need to make informed assumptions based on industry research. Let's break it down from scratch.

The LTV Calculation: Step-by-Step Math

STEP 1: Convert Bi-Weekly Pricing to Monthly

FitHub charges bi-weekly (every 2 weeks), not monthly. First, we need to convert:

12-Month Contract:

• Price: $49 bi-weekly
• Calculation: $49 × 26 pay periods per year ÷ 12 months
• = $106.17 per month

Let's verify: $106.17 × 12 months = $1,274.04 per yearCheck: $49 × 26 payments = $1,274 per year ✓

Month-to-Month:

• Price: $59 bi-weekly
• Calculation: $59 × 26 pay periods per year ÷ 12 months
• = $127.83 per month

Let's verify: $127.83 × 12 months = $1,533.96 per yearCheck: $59 × 26 payments = $1,534 per year ✓

STEP 2: Estimate How Long Members Stay (The Big Assumption)

This is where industry research comes in. We're not guessing - these numbers come from:

• IHRSA (International Health, Racquet & Sportsclub Association)
• Two-Brain Business gym retention studies
• Exercise.com industry reports analyzing millions of memberships

For Annual Contract Members:

What the research shows:

• Guaranteed minimum: 12 months (they signed a contract)
• Industry average for contract members: 12-14 months
• Best-performing gyms: 23.5 months average
• Worst-performing gyms: 6 months (people break contracts)

Our assumption: 14 months (conservative middle ground)

Why conservative? Many members continue month-to-month after their contract ends, but we're only counting 2 extra months beyond the contract.

For Month-to-Month Members:

What the research shows:

• Industry average: 9-10 months
• 50% quit within 6 months (the "New Year's resolution" dropouts)
• The other 50% stay much longer (averaging 12-18 months)
• Overall average: 9-10 months when you blend both groups

Our assumption: 9 months (conservative)

STEP 3: Calculate Revenue Per Member

Annual Contract Members (23 people):

Monthly rate × Expected months = LTV per member

• $106.17/month × 14 months = $1,486.38 per member

Let's break down what this means:

• Months 1-12: Guaranteed contract revenue = $1,274.04
• Months 13-14: Estimated continuation = $212.34
• Total projected value = $1,486.38

Total revenue from 23 annual members: 23 × $1,486.38 = $34,186.74

Month-to-Month Members (35 people):

Monthly rate × Expected months = LTV per member

• $127.83/month × 9 months = $1,150.47 per member

Total revenue from 35 monthly members: 35 × $1,150.47 = $40,266.45

STEP 4: Total Projected Revenue

Annual member revenue: $34,186.74
Monthly member revenue: $40,266.45
‍Total: $74,453.19

The "Is This For Real?" Check

Let's reality-check this with more conservative assumptions:

Pessimistic Scenario:

• Annual members stay only 12 months (contract minimum, zero renewals)
• Monthly members average only 6 months (high churn)

Calculation:

• Annual: 23 × ($106.17 × 12) = $29,379.24
• Monthly: 35 × ($127.83 × 6) = $26,768.10
• Total: $56,147.34

Even in this pessimistic case:

• Revenue: $56,147
• Cost: $4,497
• ROI: 1,148% (12.5x return)

Super Pessimistic Scenario:

• Annual: 12 months only
• Monthly: Only 3 months average (terrible retention)

Calculation:

• Annual: 23 × ($106.17 × 12) = $29,379.24
• Monthly: 35 × ($127.83 × 3) = $13,424.55
• Total: $42,803.79

Even here:

• Revenue: $42,804
• Cost: $4,497
• ROI: 852% (9.5x return)

The Guaranteed Floor:

Want the absolute minimum? Just count the contracts:

• 23 annual contracts × $1,274.04 (their full 12-month contract) = $29,379.24
• This alone is 6.5x the campaign cost
• Everything from monthly members is bonus

Total Projected Revenue (Using Industry-Average Retention)

Annual Member Revenue + Monthly Member Revenue = CA$74,453.19

The LTV:CAC Ratio

This is the golden metric that shows campaign efficiency.

LTV:CAC Ratio = Average LTV per Customer ÷ CAC

• Average LTV: CA$1,283.68
• CAC: CA$77.54
• Ratio: 16.6:1

What This Means: For every dollar FitHub spent acquiring a customer, they're getting $16.60 back.

Industry Benchmarks:

• Minimum acceptable: 3:1
• Good performance: 5:1 to 10:1
• Excellent performance: 10:1+
• Best-in-class gyms: 30:1

🌟 FitHub's 16.6:1 ratio is excellent!

Why The ROI Isn't As Crazy As It Seems

"1,555% ROI sounds like BS. Is it?"

Here's why it's actually reasonable:

1. The Prize Was Cheap (For FitHub)

• A year-long membership COSTS FitHub $1,534 in forgone revenue
• But they're not losing product cost - just membership fees
• Marginal cost of one more member? Almost nothing (no extra equipment needed)
• This is like a restaurant giving away a $100 gift card that only costs them $30 in food cost

2. Gym Memberships Are Recurring Revenue

• This isn't selling a $100 product once
• It's selling a $106-128/month service that repeats every month
• 14 months of $106 = $1,486
• That's why LTV is so much higher than a single transaction

3. Contracts Create Guaranteed Revenue

• Those 23 annual members will definitely pay for 12 months
• That's $29,379 in guaranteed revenue before anyone cancels
• The campaign paid for itself 6.5x over just from contracts alone

4. The Ad Spend Was Really Efficient

• $2,963 to acquire 58 members = $51 per member in ad spend
• Industry average is $100-300 per member
• FitHub's ads converted exceptionally well

The Real Test: Track Actual Retention

These projections assume industry-average retention. The TRUE ROI will be revealed over the next 12-14 months as you track:

• How many annual members renew after month 12
• How many monthly members are still active at month 6, 9, and 12
• What your actual average membership length turns out to be

If FitHub has great onboarding and community, retention could be BETTER than industry average (hello 20x+ ROI). If retention is worse, it'll be lower. But even pessimistic scenarios show 9-12x returns.

What If We're Wrong? Scenario Analysis

Let's stress-test our assumptions:

Best Case Scenario

What if retention is better than average?

• Annual members stay 18 months (higher retention from great experience)
• Monthly members stay 12 months (converted to fans)

Revenue: CA$97,642.98
ROI: 2,071%
Multiple: 21.7x return

Worst Case Scenario

What if retention is worse than average?

• Annual members only stay their 12-month minimum
• Monthly members average just 6 months (high churn)

Revenue: CA$56,147.22
ROI: 1,148%
Multiple: 12.5x return

Even in the worst case, FitHub still gets a 12.5x return!

The Hidden Value You Can't Measure (But Matters)

Beyond the direct revenue, this campaign generated:

1. A Pipeline of Warm Leads

• 107 people did free trials
• 49 haven't converted yet
• At just 30% conversion rate, that's 15-20 more members worth CA$19K-25K

2. Above-Average Conversion Rate

• FitHub converted 49.2% of trials to paying members
• Industry standard: 30-40%
• This suggests strong product-market fit and sales process

3. Brand Awareness

• 165 people engaged with the brand
• Social media buzz and shares
• Word-of-mouth from contestants

4. User-Generated Content

• Draw announcement video
• Social proof from participants
• Testimonials from winner

5. Email Database Growth

• 165 qualified leads for future marketing
• Nearly free compared to buying email lists

Why This Campaign Worked: Key Success Factors

1. Low Barrier to Entry

The free trial option (1 entry) made it easy for anyone to participate, creating a wide top-of-funnel.

2. Incentivized High-Value Conversions

20 entries for annual membership vs. 1 for free trial created strong motivation to commit.

3. Timing

Launched during peak fitness motivation season (New Year's resolution period).

4. Prize-to-Cost Ratio

A year-long membership sounds valuable (CA$1,534) but is relatively low cost compared to revenue generated.

5. Multi-Channel Approach

Google captured intent, Meta built awareness—they worked together effectively.

6. Simple, Clear Mechanics

Easy to understand rules removed friction from participation.

The Payback Period: When Did FitHub Break Even?

Payback Period: 0.7 months (about 3 weeks!)

This means FitHub recovered their entire CA$4,497 investment in less than a month. Everything after that is profit (minus operating costs).

Monthly Revenue Rate from New Members:

• 58 members generating revenue over their lifetime
• Average monthly revenue contribution: ~CA$6,300/month

Within the first month of memberships starting, the campaign had already paid for itself.

Lessons for Other Gym Owners

What You Can Steal from This Campaign:

1. Use tiered incentives - Don't just make everything equal. Reward higher commitment.
2. Price your acquisition costs - FitHub spent CA$77.54 per member. Know your number and benchmark it.
3. Think in LTV, not just upfront revenue - A CA$106/month member paying for 14 months is worth CA$1,486.
4. Leverage low-cost prizes - Your own services make great prizes because they cost you less than their perceived value.
5. Track everything - FitHub can now use this data to make smarter marketing decisions.
6. Don't ignore the pipeline - Those 107 free trials? They're worth their weight in gold for future marketing.

What Could Be Improved:

1. Follow-up automation - Those 49 unconverted trials need a nurture sequence
2. Referral incentives - Encourage new members to bring friends
3. Retention focus - Now the hard work begins—keeping these 58 members engaged
4. Content creation - Document the journey for social proof

The Bottom Line

Investment: CA$4,497.38
Return: CA$74,453.19
ROI: 1,555%
Payback Period: 3 weeks

For every dollar FitHub invested in this campaign, they earned $16.55 back. They acquired members at 23-50% below industry average cost and converted free trials at rates 23-63% higher than industry standards.

This wasn't just a successful campaign—it was a masterclass in efficient growth marketing for fitness businesses.

Key Takeaways

✅ Contest-style promotions can drive massive ROI when structured correctly

✅ LTV:CAC ratio is the metric that matters - aim for at least 3:1, strive for 10:1+

✅ Smart pricing beats big budgets - CA$2,963 in ads generated CA$74K in revenue

✅ Free trials convert - but only if you have a solid sales process (49.2% is exceptional)

✅ Think long-term - The real value is in retention, not just acquisition

✅ Conservative assumptions are smart - Even worst-case scenarios showed 12.5x returns

Your Next Steps

If you're a gym owner or fitness business looking to replicate this success:

1. Calculate your current CAC - Do you even know what you're spending to acquire members?
2. Estimate your LTV - Use industry benchmarks (9-14 months) as a starting point
3. Test a contest campaign - Start small, measure everything, iterate
4. Focus on conversion - Get that trial-to-member percentage up
5. Build retention systems - The best marketing is keeping the customers you have

Remember: The average gym loses 30-50% of members within 6 months. The gyms that win aren't just good at marketing—they're good at creating experiences worth staying for.

Case study data based on actual FitHub YYC campaign results from December 2025 - January 2026. LTV calculations use conservative industry-standard retention estimates.

About FitHub YYC

FitHub YYC is a premium 20,000+ sq ft fitness facility located in Calgary's Currie neighborhood. Housed in a former airplane hangar, FitHub offers state-of-the-art equipment, group fitness classes, wellness services, and a vibrant community atmosphere.

Learn more at yycfithub.com

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