Why does this gym membership fee increase as I age?

November 19, 2010 7:44 AM

Is there a legitimate reason for structuring membership dues (and initiation fees) of a club based on age levels beyond just the usual "student" vs "everyone else" levels? Specifically I'm speaking of the Los Angeles Athletic Club.

I am interested in joining a gym in LA and many people have said that the facilities at the LAAC are among the best in the city. It looks amazing so I inquired.

I received information this morning and initially wasn't too horrified. They have membership tiers for Student, Junior, Associate and Executive - and the monthly dues increase from Student to Executive, as do the initiation fees. Sweet! I thought - until I realized that the fees don't correlate to additional club benefits or anything like that - but they correlate to age!

I get that a student membership is often cheaper but the rest of this feels really strange to me. I might even be able to get on board with the monthly fees being elevated based on the assumption that as we get older we tend to have more disposable income but that still feels really gross. But the thing that is absolutely killing me right now is that at the rarefied age of 40 my initiation fee would be 5x that of a student and 2x that of a Junior member.

Can anyone here provide some clarity around this kind of thinking? Further, I know that in most fitness facilities membership dues and fees are negotiable. Does anyone know if LAAC is open to such tactics?

posted by FlamingBore to sports, hobbies, & recreation (12 answers total)

Just thinking out loud, but this could be related to insurance. Older members are far more likely to be injured while working out than younger ones. Still, that seems a little weird, and I've never heard of any other gym doing it. Seems to me like they just figure they can earn more money that way.

This could be a not-too-subtle way of ensuring that they have lots of young, pretty people on the floor.
posted by valkyryn at 7:50 AM on November 19, 2010

Sounds like Price Discrimination (in an economic, not legal sense). They're trying to hit that sweet spot to maximize revenue where the cost is just barely worth it to members which obviously is different for different segments of the population.
posted by ghharr at 7:51 AM on November 19, 2010 [1 favorite]

It may be gross, as you suggest, but I'm guessing they're basing it on the assumed rise in income as one ages. They're charging what the traffic will bear.
Fair?
Equitable?
?
posted by fivesavagepalms at 7:54 AM on November 19, 2010

My best guess really is what ghhar and fivesavagepalms are suggesting, but I suppose there could be some insurance aspect - though if that were the case wouldn't it be a more widespread practice?

The club has significant other facilities which may come into more use as one ages - it is apparently something of a social club as well. Just so weird.

The best part about this is that my partner is young enough to qualify under the Junior level. It would be cheaper to join under her, pay the lower initiation and the month addition of the spousal fee. *shaking head*
posted by FlamingBore at 8:12 AM on November 19, 2010

This type of pricing is common for social clubs, I think. Older people have more money / clubs want to attract young members.
posted by Perplexity at 8:17 AM on November 19, 2010

Perplexity - interesting. I wouldn't think that model would work over the long term - for a purely social club. I'd love to know more about this though!
posted by FlamingBore at 8:19 AM on November 19, 2010

by that I mean the divide is bizarre. I can see offering lower prices to NEW members to entice them in, but the divide in interests between the younger and the older members would make for a strange social club, no?
posted by FlamingBore at 8:21 AM on November 19, 2010

Right, you want to avoid that stark divide between younger and older members. You can't wait until all your members are in their 50's and 60's to attract new younger members to replace them, because there won't be any attraction. You want to attract people 5-10 years younger than your current younger members, because they want the networking opportunities, and they will hopefully become the successful business people who attract new members in 5-10 years. One way to do this is to make it cheap for new members to join. And then you put in tiers, so that people turning 40 or 50 or whatever the cutoff is don't see a huge fee jump that that makes them leave.

Of course, this seems a bit silly for an athletic club, but this is an athletic club that has business attire dress codes on some of the floors. And the athletic club part of it will actually attract younger members than a purely social club would.
posted by smackfu at 8:32 AM on November 19, 2010

This is common with University Alum clubs as well. Membership fees go up depending on how many years it is since your graduation.
The logic is, yes, that the older alums have more money.
posted by vacapinta at 8:33 AM on November 19, 2010

Older people have more money, all else being equal.

People with more money are able to pay more for the same things.

People with more money are often willing to pay more for the same things.

There is not all that much "so weird", "strange", or "bizarre" about this as you think.
posted by astrochimp at 8:39 AM on November 19, 2010

LACC does have nice facilities, but joining just for the gym might not be as worthwhile as joining to network, etc. There's other places that are just about as nice, and not as oriented towards downtown/USC business types. I'm not knocking the place at all, just pointing this out (family member used to belong.)
posted by Ideefixe at 8:44 AM on November 19, 2010

Snap!

I just got a follow up call and asked about this. They used to have a $1000 initiation fee and $160/mo for all members. They realized few people were in a space to afford that so they did some restructuring.

When I commented that maybe I'd have my younger partner join the woman responded "this is a business, we can't have that." I begged pardon and she followed with "we put the membership rate at the oldest person."

Guess I'll be looking elsewhere. Thanks folks.
posted by FlamingBore at 10:07 AM on November 19, 2010