CIO whips Bally Total Fitness into shape with new CRM techniques

Albert McKeon

Guy Thier has a free membership to Bally Total Fitness and would love to work out.

Guy ThierGuy Thier

What stops him is that he's so busy trying to improve Bally's customer relationship management (CRM) that he has no time to exercise.

As CIO of the fitness chain, Thier has used several CRM techniques -- including converting the company's hard-nosed collection service into a friendlier contact center -- with the hope of making Bally's 60 health clubs places where members can sweat and know one another's names.

"A lot of this stuff, it doesn't take much to try it," Thier said.

A Bally executive for nine years, he wants to make each health club a place where members are free to reach fitness goals and meet new people -- something like the bar in the TV show Cheers, except with treadmills.

It's a far cry from Bally's perspective of CRM when Thier joined the company. Back then, Bally had no customer service strategy other than hounding members for money, he said.

While dealing with financial woes, Bally last year sold 117 of its clubs to LA Fitness to pull out of debt. The company also contended with a reputation of poor customer service. It settled out of court with several customers for allegedly misleading them with long-term contracts, and in 2005, the New York attorney general's office had Bally agree to change its sales tactics.

Thier intends to reshape the Bally image one CRM initiative at a time, tapping his experiences from two decades in IT and retail.

Field experience leads to retail CRM

A 1983 graduate of Lewis University, a Catholic college in his native state of Illinois, Their first put his computer science degree to use by working for the nonprofit Argonne National Laboratory. As part of the job, Thier drove around the country in an Argonne mobile laboratory, visiting refineries to help with the adoption of automated petroleum testing.

Business Informer: Guy Thier

Position: CIO of Bally Perfect Fitness

Age: 50

Hometown: Chicago

Education: A bachelor's degree in computer science from Lewis University

Favorite business (other than Bally) because of its customer service: Starbucks

When he finds time to exercise, he listens to: Dacav5 and Nicki Minaj

Recreation: Cruising the waters around Chicago on his twin-engine boat

The Chicago sports team most deserving of a championship: White Sox

Thier enjoyed seeing refinery workers get excited about their jobs becoming easier and efficient. That enthusiasm prompted him to realize "that I didn't want to be a programmer in a cube. I wanted to have an impact." So he left the lab for the world of retail.

One of his first retail jobs was vice president of IT for the Chicago-based Chernin's Shoes, where Thier led the chain in its effort to become one of the first in the country to use uniform product coding for footwear. Chernin's was also one of the first to offer customer kiosks in stores and sell shoes on the Web, he said.

Their also served as vice president of IT for the consulting company LINC Capital before working as a management consultant for Empowered Software Solutions. He later joined the fitness chain in 2003.

Thier had a Bally membership for 15 years before becoming an employee. He saw firsthand how, once people became members, the only contact Bally had with them was through the rather cold CRM process of dues collection. The Bally Total Fitness contact center was, in fact, a collection agency.

"The customer experience was not pleasant," Thier said. "You'd walk in to buy a gym membership, tour the place, then a sales person would berate you into joining, and then never speak to you again. The only conversation you had after that was if you were delinquent in payment. Then they'd threaten your credit."

It's one thing for a gym to treat its customers that way if it's the only one in town, Thier said, "but when the competition comes in and treats its members better and acts like a fitness place, then you have to change."

Using new CRM techniques to change culture

Once aboard, Thier examined how Bally could change its culture. It seemed obvious that Bally had to use new CRM techniques, including halting the "hard sell" of member services, he said.

Thier first shifted the collection service to a contact center. In a transition that lasted a few years and was completed in fall 2011, the contact center implemented an interactive voice response system and an intelligent call routing application for agents to see member history. It also opened contact center channels beyond the telephone, integrating Web chat, texts and email.

"We also went for a much softer approach," Thier said.

Bally then retrained its contact center agents on the right ways to communicate with customers. Some agents resisted, but because of consistent turnover in the contact center industry, new employees eventually joined the fold and accepted the updated CRM practices. It took holdover agents some time to adjust, but they eventually embraced the new methods.

Contact center staff size shrunk during the transition: from 250 agents to about 125 now. But agents no longer sit behind a company desk; they work flexible hours from home. "It's worked amazingly well," Thier said. "People who work at home are more productive."

The conversion of the contact center served as a microcosm of Bally's new CRM attitude, he said. Staff members at Bally have dropped the hard-sell approach and now communicate with people long after they've signed on the dotted line.

You have to make sure your culture matches that of the customers.

Guy Thier, CIO, Bally Total Fitness

Part of the new CRM outlook includes technology. Salespeople at Bally clubs carry iPads. If prospective members mention they first want to scout other gyms for prices and services before joining, sales reps will open their iPads and show the competition's offerings.

The staff also has a native CRM iPad application that shows the pictures and profiles of members. It reveals members' workout goals and achievements, allowing the staff to approach people on a personal level, Thier said.

On the customer side, Bally offers an application that members can use to track their workout regiments without worrying about carrying a pencil and clipboard while they navigate the gym equipment.

Bally also offers a Microsoft application that connects to four large-size TV screens. Facing a high-definition Web camera, a member can see his or her current physical shape on the big screens, and at the wave of a hand, virtually lose weight.

Each Bally club also has its own Facebook page, and the chain's main website will soon have a facelift.

As part of an effort to make Bally gyms feel more personal – or, as Their hopes, more like Starbucks -- the CIO is helping the company introduce juice bars. On his Bally app, a member can order a smoothie while working out, pay for it on the mobile device, and have the drink ready at a certain time.

Bally will continue running a test program next year at about six gyms, but Thier expects the juice bars to succeed and eventually be at every location. "We've seen them stay awhile and use their computers [and] check their email and other things while relaxing after a workout," he said.

Not all CRM techniques have succeeded, however.

"I had a failure just this summer," Thier said. "We tried another iPad app that allowed trainers to work out clients when the clients were not at the gym. The trainer could say, 'Here's the exercise routine you could follow at home.' But we didn't get it. The trainers didn't get paid for that time. They didn't like it. We pulled the plug on that."

The new technological CRM offerings are not high-cost items, Thier said. "If it doesn't add to the member or employee experience, it's not worth doing. If it's something employees will embrace and it allows them to relate to the customer in some way, we'll give it a shot."

Having a friendlier gym should give members the incentive to exercise, said Their, who added that consumers expect personalized CRM nowadays.

"Everyone is really rushed and everyone has a limited amount of time to get in and exercise," he said. "They expect to be pampered. You have to make sure your culture matches that of the customers."

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