How Important Are Online Classes For Your Business?
When it comes to making business decisions a competitor analysis is often done to see what is and isn’t working for others. We believe, that there is room at the table for all Orgs who offer a unique perspective on health and wellness and have an audience that’s just for them. With that being said, we wanted to make your competitor analysis a little easier by seeing what’s working best for Orgs across Union.
While every Org is different and has its very own business model, by looking at Union-wide stats, you can get a feel for what the industry is seeing and ways to improve your offerings.
The Results Are In
In a nutshell, we're seeing that on-demand content is a huge part of how people interact with your products. Even when slow season approaches, students are keeping up with their online classes. Whether you're a studio and offer in-person and online options, or a creator and only offer online products, having a variety of on-demand classes in your library and Video Calls (through Union Video or Zoom) creates an user experience that keeps them coming back.
Issued by Type:
March 2021 - 18000 in-person issued/ March 2022 - 53,000 in-person issued
March 2021 - 35,000 online issued/ March 2022 - 27,000 online issued
Over the last year, we’ve seen the number of online classes month over month stay relatively the same fluctuating between 27,000 and 30,000 registrations. However, when it comes to issued in-person registrations, we’ve seen a steady increase over these last 12-months with an ever so slight decrease during the winter months of this year, most likely due to the Omicron variant of COVID-19.
This data reveals to us that even as people return back to the studios the need for an on-demand library is still present. What we’ve foreseen when Union started, was that online classes wouldn’t completely replace students' need and love for the in-person experience but would complement it. This means, that if you aren’t offering an online option along with your membership, you’re missing out. By providing more value to your customers you’re sure to help them achieve their goals as well as achieve your goal of increasing retention.
If you’re a creator and only offer online options, then you’ll notice while livestreams count for something, emphasis needs to be placed on your library and your external video call offerings. These two things are the way to add more value to a subscription and allow you to charge more. (Maybe have a Livestream subscription for a small monthly fee and an all-access subscription for a higher subscription rate.)
Revenue By Redeemed Type (%)
Here is where things get interesting. Where are we seeing the bulk of revenue coming in from? For studios, in-person classes will most likely always be your biggest revenue, just as we’ve seen the increase of registrations go up, we see revenue increasing too.
However, what’s interesting about the graph above is that in almost every month, the replay library still holds a large piece of the cake. During the months when in-person classes were limited it’s no surprise that on-demand classes brought in over 30% of the revenue. But even as things open up and studios fill in again, we can see that anywhere from 8-20% of revenue is still coming from replays. What’s also exciting is to see is that External Video Calls (or now our Union Video calls) can account for 6-15% of your average revenue. It’s that one-on-one experience that makes students feel like they are a part of a community and offer more value to them.
If you are a creator and don’t have a studio, don’t worry, these stats still apply to you. You’ll see that building up a strong and versatile library will serve your Org best. Alongside this, if you aren’t taking advantage of External Video Calls or the soon-to-launch Union Video (you can sign up for beta testing here) you’re missing out on a huge revenue stream and a way to retain your customers.
The combination of online and in-person options will make your studio a force to be reconned with. It’s a great added bonus to your highest tier subscribers and gives them the value they need to retain their membership with your Org.
Even without in-person classes, students can supplement their in-person classes in their neighborhood with a creator’s online option. Online has the flexibility to be practiced anytime, anywhere which is where its value comes from. As a creator, it’s your job to build a library of classes that are easy to search through to find the one that fits your students’ needs. (Check out this blog post to learn more about this.) You can also increase value by creating the feel of a community with Union Video or External Video Calls. This allows your students to come together, ask questions, move together, and feel like they are a part of something bigger, just like an in-person class does.
Katie Leigh is a Marketing Strategist for small businesses. She helps Orgs simplify their marketing, connect with their audience, and create work-life balance. Download her free guide to work-life balance here.