Smash or ClassPass?
After hearing plenty of good things recently about a fitness class scheduling app called ClassPass, I decided to give it a try. The first month was free, so what did I have to lose?
I quickly began sharing my excitement with anyone who would listen to me talk about how cool the app was. The next blog post on my website will be about my actual experience.
“Wait, but how do they make money?” Someone asked after I explained how much I was (or wasn’t) paying for these workouts. I didn’t know how to answer the question and found myself wondering the same.
While investigating, I came across a few articles calling the company a “unicorn,” and after a prompt Google search of “what does it mean if a company is a unicorn,” I learned it refers to a privately held start-up company valued at over $1 billion. Apparently, this doesn’t happen too often, hence the name “unicorn.”
The company uses an increasingly popular subscription-based service method. For me, the first month was free and gave me something like 25-30 class “credits.” All classes I’ve seen have been 3-5 credits. The following months, users pay $60, unless they recruit a friend and get $40 off, for a similar number of credits.
Within a user’s interface, ClassPass has implemented a strategy called variable pricing. This means classes differ in price, or credits, depending on the demand. Popular classes that are more likely to be filled will be worth more credits, and classes that are less likely to be filled, worth fewer credits. The method is comparable to how airlines and hotels fill empty seats and rooms.
Similar to the concept of programmatic advertising, in which computers buy and sell ads and ad space, ClassPass now uses proprietary algorithm-based systems to fill its classes by looking at data like attendance history and current enrollment in real-time. This allows the platform to optimize studios’ yield while keeping prices low for customers.
I do find it interesting to be paying a flat monthly rate for credits. It feels like I’m using money to buy different money.
As if it’s any different from the dollars I’ve already spent, now just sitting in my Starbucks or Dunkin’ apps until I’m ready to spend it only on coffee.
Just as I like to mix up where I get my coffee, ClassPass’s users like to enjoy a variety of class types.
Use my referral code to get a free month of ClassPass!
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