New years resolutioners annoying at gym12/13/2023 If they were charged what they were willing to pay, the optimal move for the gym in question would be to offer better services to everyone, in order to capture more of those high-value customers' dollars and to spot more of them early in their fitness-enthusiast careers. Under-exploitation is probably a smaller social problem than over-exploitation, but one way to look at it is that a subset of gymgoers are deriving thousands or tens of thousands of dollars of value from their membership each year, and paying a tiny fraction of that. Any time a business creates some consumer surplus for a subset of users, the natural evolution is towards a) capturing more of that surplus, and b) having a correspondingly larger budget for targeting those customers, both with better marketing and with a better product. The other problem with this model is that it under-exploits its best customers. In fact, for purchasing decisions that people consider repeatedly and periodically choose to make, you can think of them as having a winner's curse where the prices are roughly fixed but motivations vary. That can be unavoidable, and there are plenty of other industries that survive even though many people buy their products at a high point in their motivational cycle. The obvious one is that it's exploiting people who overestimate their willpower and sign up for a product that is, for them, a very bad deal. the average fitness level in a gym at a given time will always be higher than the average fitness level of the gym's members.) (There's upside to these customers, though: for one thing, they're walking billboards, and the population of a gym during a new customer's tour is not an unweighted selection of customers but a selection of customers weighted by time they spend in the gym, i.e. Annoyingly for gym owners, the more intense exercisers will also tend to be pickier about things like hours of operation and equipment availability. The gym needs to balance the large volume of customers who will show up in January (maybe), work out diffidently for a while, and then never come back, against the smaller number of customers who make the whole enterprise worth keeping open in the last half of the year. is the group of people who become absolutely maniacal about fitness.Ĭlassic gym economics relies on the first set of users. The smallest subset in terms of numbers but possibly a majority in terms of time spent, grunts emitted, etc.One set of customers drives the main seasonal trend they're on a roughly annual cycle of losing weight half the year and gaining it back the other half of the year. For these customers, the closest analogue to gym membership is a lottery ticket: for an upfront cost you can buy a semi-credible fantasy about how different your life might be.
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