D376 Task 1 Customer Experience Analysis Example

The First Class and the First Missed Week: A Customer Experience Analysis of Why New Members Leave a Composite Regional Fitness Studio Chain in Their Third Month

Student Name

School of Business, Western Governors University

D376: Product, Price, and Customer Experience, Task 1

Course Instructor

Month Day, Year

The First Class and the First Missed Week: A Customer Experience Analysis of Why New Members Leave a Composite Regional Fitness Studio Chain in Their Third Month

The Business and the Problem

Pulse Collective, a composite chain of 11 boutique fitness studios in Texas, offers small-group strength, cycling and yoga classes. Its product is a monthly membership of $129 for unlimited classes. The chain attracts new members well: about 420 a month join after a free trial class. It keeps them poorly. Membership data show that 38% of new members cancel by the end of their third month, compared with 12% a month among members who stay past month four. Each lost member represents about $1,400 in revenue over a typical tenure. Leadership has asked why new members leave and what can be done.

Product and Service Offering

For a service business, the product is the experience. Pulse's offering includes the classes themselves, the instructors, the studio environment, the booking app, communication before and after classes and interactions with front desk staff. The core product is strong; members who stay rate instruction quality highly. The question is whether the experience around the product helps new members through the difficult early months when a fitness habit is forming.

Mapping the Member Path

Customer experience research describes the customer's path through prepurchase, purchase and postpurchase stages, with many touchpoints at each, some controlled by the firm and some not, and emphasizes that experience is shaped across the whole path rather than at single points (Lemon & Verhoef, 2016). Using app data, exit surveys from 310 canceled members and interviews with 15 current and former members, the team mapped each touchpoint.

Prepurchase: social media ads and friend referrals, the website and booking a free trial class.

Trial and purchase: arriving for the first class, meeting the instructor, the class itself, and a membership pitch at the front desk afterward.

Early membership, weeks one to four: booking classes in the app, a welcome email, attending classes, occasional interactions with instructors.

Habit formation, weeks five to twelve: attendance patterns, missed classes, a monthly billing email.

Renewal or cancellation: most cancellations are submitted through the app between weeks eight and twelve.

Moments of Truth

Not every touchpoint matters equally. The idea of the moment of truth, an interaction in which a customer forms or changes an impression of a company, was popularized by an airline executive who argued that every brief encounter between a customer and an employee shapes the customer's view of the whole business (Carlzon, 1987). Two moments stand out in the data.

The first class: exit surveys show that members who described their first class as intimidating or confusing were twice as likely to cancel by month three. Many trial participants were placed in advanced classes because those had open spots, received little introduction to equipment and left unsure whether they belonged.

The first missed week: app data show that members who miss seven consecutive days in their first two months are four times more likely to cancel. Pulse currently does nothing when this happens. Several former members said they felt embarrassed to return after missing a week and assumed no one noticed.

A third, smaller moment is the billing email, which arrives with no mention of the member's progress, making the charge feel like a cost rather than an investment.

Recommended Improvements

Redesign the first class: offer dedicated beginner sessions for trial participants, with an instructor who explains equipment and form and introduces the new member to two regulars. Research on customer service suggests that reducing the effort customers must expend to get what they need builds loyalty more reliably than attempts to delight them (Dixon et al., 2010); for new members, effort includes figuring out where to stand, how the equipment works and whether they fit in.

Respond to the first missed week: when a new member misses seven days, the app triggers a personal text from their first instructor, not a marketing message, inviting them back to a specific upcoming class.

Add a 30-day check-in: a short conversation with an instructor about goals and a suggested weekly schedule, which helps members plan the habit.

Make billing about progress: include classes attended and a milestone in the monthly email, so members see what their membership has delivered.

Train front desk staff to greet new members by name for their first month, making the studio feel welcoming.

Why These Fixes Fit the Business

The improvements are deliberately inexpensive and built on what Pulse already does well. Beginner sessions use instructors and studio time that are often underused in midmorning and early afternoon. The missed-week text takes an instructor two minutes and uses data the app already collects. The 30-day check-in can happen before or after a class the member is already attending. None requires new equipment or a price change, which matters because the chain's margins are thin. The changes also fit the chain's culture: members who stay say the community is the main reason, and every recommendation is designed to bring new members into that community sooner. If retention improves as targeted, each studio would keep about 15 more members every three months, worth roughly $21,000 in future revenue per studio per quarter, far more than the added instructor time costs. The chain will also watch for unintended effects, such as instructors spending so much time on new members that regulars feel neglected.

Measuring Improvement

Pulse will pilot the changes in four studios for three months and compare them with four similar studios. The primary measure is the share of new members still active at the end of month three, with a target of 72%, up from 62%. Supporting measures include first-class satisfaction scores, the share of new members returning within 14 days after a missed week and net promoter score among members in their first three months.

Conclusion

Pulse Collective's core product is strong, but new members leave because two moments, the first class and the first missed week, leave them feeling out of place and unnoticed. Mapping the member path and focusing on those moments points to practical, low-cost improvements that make the experience easier and more personal in the months when a fitness habit is formed. The experience improvements also support a pricing structure in which members see value worth paying for.

References

Carlzon, J. (1987). Moments of truth. Ballinger.

Dixon, M., Freeman, K., & Toman, N. (2010). Stop trying to delight your customers. Harvard Business Review, 88(7/8), 116-122.

Lemon, K. N., & Verhoef, P. C. (2016). Understanding customer experience throughout the customer journey. Journal of Marketing, 80(6), 69-96. https://doi.org/10.1509/jm.15.0420