Why do we pay to not go to the gym?
It happened again…
You haven’t kept your gym promise and postponed it to “a tomorrow”, which hardly ever comes. To set a gym routine, you have finally found the courage to take action and subscribe to a gym club.
But is it really to say that you’re committed since you pay a large chunk of money upfront? Science may be saying the opposite!
Here, I aim to help you uncover your hidden gym habits and understand why simply enrolling to a gym doesn’t necessarily induce you to feel committed to your fitness goals. I provide several insights based on scientific evidence.
It all starts with research!
DellaVigna and Malmendier (2006) collected data from more than 7000 people from 3 US-based health clubs, over a duration of three years to uncover gym behaviors. In their paper, they mainly discuss consumer choices for health club memberships, among 3 type of subscriptions offered: Annual contract, monthly contract and daily visit pass.
Briefly, an annual contract expires after a year and it is needed to be renewed explicitly, if wanted. Monthly contract is automatically renewed over the months and needed to be canceled explicitly, if wanted. Both are called “flat rate contracts”. Lastly, daily visit pass offers two options: either to pay a fixed amount per visit or purchase a ten-visit pass, which both have the same logic: pay-as-you-go.
Initially, researchers have certain predictions based on the general assumption that people are rational about their present and future, and choose optimally to maximize their benefit and minimize the cost.
This is where the plot twist comes: it is not always the case! Indeed, people do behave irrationally and end up wasting money.
Justifying a flat-rate contract might only be self-deception…
Why people pay large sums of money upfront and buy flat rate contracts over pay-as-you-go option? Although several driving forces pop-up, first I’ll go with the risk aversion: how much people are willing to avoid uncertainty.
Flat rate contracts offer a predictable scenario: you fix the exact cost upfront so that you can go as much as you want and a bonus, your perceived attendance fee would be at a discount for each time.
On the other side, when considering the pay-as-you-go option, people often have a hard time predicting how many times they would go. They are afraid of going too frequent so that the flat rate contract would become the preferable option, and regretting not choosing it. They are so nervous about the possibility of future regret and do not want to “risk it”.
However, in the flat rate option, there is no room for this distress and a plus, this choice serves as a commitment device for the future-self; people are binding themselves to become a persistent gym attendee.
Another reason could be the psychological benefits obtained by becoming “an official member” of a health club, as people tend to have an inherent and inevitable desire to belong to and be an accepted member of a group.
Also, I need to give credits to the fiercely dedicated sales force of the gym who persuades you for a premium package with a promising pitch, full of sparkling benefits.
In brief, the predominant reason why people choose either monthly or annual contract over pay-per-visit option should be that they are going to use the gym more frequently so that the flat rate contract would be economically advantageous. This is only what people deeply anticipate, though it is not the real case.
Get ready for the statistics: the scientists have uncovered that 80% of monthly users and 76% of the annual users do overpay and would have been better off if they had chosen the pay-as-you-go option!
Then the scientists calculate “price per attendance” as the ratio of the total payment over the total attendance to better compare each option. They find out that the price per visit of people who choose the monthly contract is $17 and the annual contract is $15, which are both significantly higher than the $10 pay-per-visit price.
Only 20% of monthly members and 24% of annual members pay less then $10 per visit. Likewise, the overwhelming majority pay way more when they choose a flat rate contract. This result is quite counterintuitive, isn’t it?
According to DellaVigna and Malmendier, the leading explanation of this phenomenon is that people are so overconfident about their future self-control and naively overestimate future attendance. Sounds familiar, right?
“I’ll go to the gym tomorrow then, but tomorrow after tomorrow…”
Now, the question is that if they realise that they cannot benefit from their contract effectively as they intended, do they adjust their behavior to further attend by time?
Guess your gym pattern by time: Fiercely increased attendance or near the cliff to drop out?
A rational person expects that the monthly enrolled members, who do not cancel their membership, would have an increased attendance over the months, so that their contract would be profitable enough.
Precisely, researchers discover that the average attendance in the first 6 months is significantly higher than in any of the later six-month periods among stayers. But why?
Maybe you just remembered your new year’s resolution to loose some weight and fit in your newly bought skinny jeans. Or maybe you are working out towards your ideal summer body and you just find your self binging by summer as you will not “need” a flat belly afterwards…
Or perhaps you just stick to your current decision and do not want to cancel your automatic monthly renewal, even though you go less and less.
Unbelievable but probably you even postpone paying less!
If monthly enrolled members do attend less and less over months, how come they do not cancel their membership on time to prevent unnecessary splurge? The one thing they do quite successfully is delaying…
Low attenders fail to cancel their membership on time and on average 2 full months, yes 2 whole months pass between the last attendance and the contract cancellation.
Here researchers propose several explanations to rationalize these findings. Although they mention that cancellation has transaction costs, the time cost of dropping by to the gym to cancel or sending a cancellation letter, they conclude that this interpretation cannot explain the phenomenon thoroughly, due to these costs are actually considered as small.
What is more, although average monthly attendance among survivors decreases over time for the monthly contract, the opposite is true for the annual contract. In other words, while monthly enrolled members attend less and less by the months pass, annually enrolled members have an increased monthly participation in the second year.
How come the attendance simply increases in one group and decreases for the other group as the time passes by?
This may seem puzzling but it is rather meaningful. Here, I propose an explanation based on a psychological phenomenon: the status quo bias. This bias refers to the tendency of doing nothing and maintaining one’s current or previous condition, instead of taking an action and make a change.
At this point it is highly valuable to remind that, monthly subscription is automatically renewed and any cancellation does require an action, which is a change from the current status.
In my opinion, even though researchers refer to this effort to explain the case to some extent, they have underestimated its scope and stated that it cannot be explained considering the transaction cost. I disagree, because it might seem to be small (just sending a cancellation letter, visiting the gym etc.) but nevertheless requires an action.
This is also linked to the loss aversion phenomenon, which is mentioned above. People do not want to loose their possessed benefits (like being a member of a group), even though they are not profiting enough apparently. In this context, people are likely to go for the opt-in plan and stick to their status-quo, instead of changing it even though the change would result in gain (in this case, economic).
If this is your second year (or more) at the gym, congrats, you’re a survivor!
Admitting that the initial parts are the good news for the gym owners, finally it’s time to talk about the other side. Researchers disclose that the average attendance among stayers in the 2nd year is significantly higher than the attendance of the initial group in the 1st year.
It means that if you make it to the second year and intentionally renew your contract, you’re among the successful survivors! Here, I also link the reasoning to the previous section, the status quo bias.
At the end of the 1st year, when the annual contract expires, low attenders do not make a move to renew their contract, instead they go with their current status -expired contract-, in line with the status quo bias.
On the other hand, people who truly attend to the gym and who are determined about it, take action to renew their annual contract. Those people do not fall to the status quo bias; they evaluate each scenario thoroughly, choose the one that works better and they are brave enough to take action even it requires a change.
And yes, you can be one of them!
What are the implications and what can you do about it?
Okay, there might be multitudinous underlying reasons for not going to the gym, maybe it’s winter and too cold to go to the gym, or it’s summer and you’re burning; maybe you’re too tired or you’re simply not in the mood.
Plus, your gym seems like it doesn’t want you to come either, but it’s too late because you have already promised yourself!
So, what can you do about it? I want to share my simple tiny tricks here, which help me stay dedicated to my gym routine:
1. Acknowledge your own irrationality!
Honestly, by acknowledging you might not be that perfect and behave rationally every time, you get on the right track. Even simply by being aware of your flaws and having the ambition to fight with them help you overcome your irrationality.
2. Enlist a gym buddy
Friends can reinforce us and make us feel committed. Even if I attempt to skip a gym day, my gym buddy texts me, calls me and tries all possible means to push me to come to the gym. She provides accountability, and it works.
3. Put it in your calendar
I live by my calendar. By writing on my outlook, my notebook and also sharing with my live calendars (my friends, colleagues and family), I create myself some sort of liability and obtain support from them to keep me on track.
You’re all set and on the way to become a better version of yourself. Focus on the benefits and envisage how achieving your gym goals would make you feel proud and awesome!
One last thing…
I’m super excited because this is my first article! If you enjoyed it and found it helpful please clap or share so that you can inspire others. I would greatly, greatly appreciate it!
Thanks!
