I thought I was about to see a fight!
It would have been a good one considering I was sitting at the MAIA Supershow (Martial Arts Industry Association).
It was about 12 years ago in Las Vegas and in one of the breakout rooms, there was a speaker talking about up-sells and how he had two tiers of membership in his school, like a Black Belt Club and a Leadership Program. These days that’s common practice for many schools, but there was one instructor there who was deeply offended at the thought of having a core program and some type of upgrade program.
In the middle of the presentation, this instructor stood up and called the presenter a snake oil salesman and told him that it’s people like him that are going to ruin the martial arts.
So the speaker calmly asked him if had ever gone to McDonald’s. He said yes. Then the speaker asked him if he’d ever been asked, “Would you like fries with that?” He said yes. Then the speaker asked him if he got just as upset at the McDonald’s cashier who tried to up-sell him and if he told that poor unexpecting cashier that it’s people like them that are going to ruin the fast food industry. The instructor left.
There are those that think things should always be just the way they are and that any sort of change is comparable to some sort of treason.
Up-sells or upgrades are relatively new to the martial arts industry, but they’ve been a part of successful business practices for decades. You might not know it, or be aware of it, but you’re always being up-sold. Like the example earlier, nearly every fast food restaurant asks, “would you like fries with that?” Or after you finish your order they continue to ask, “anything else?” They ask you in order to make you have to say no, and many people will add on another item or two just so they don’t have to say no!
The government does it when you get plates for your car. How many options do you have in your state for license plates? In Arizona we have around 20. So for an extra charge, you can have you sports team on your license plate. Upgrade. For another extra charge you can personalize your license plate. Upgrade.
How about your cable or satellite television? You get the basic package, but if you want more sports channels… upgrade. If you want movie channels… upgrade. What about when you buy a television, a computer, even a car? That warranty is (guess what?) an upgrade.
Up-sells and upgrades have gotten a bad reputation because there are people out there who are doing it solely to make an extra buck, but not providing any real value for what they are charging. This leaves customers feeling like they were intentionally tricked into buying something and with bad feelings about sales and upgrades in general. I’m almost certain the instructor at that conference, at some point in the past, had an unpleasant experience with a with a bad or dishonest sales person
However, when done correctly, an up-sell or upgrade will leave your customer feeling even more satisfied and excited about what they just purchased.
In a Taekwon-Do school there’s no one way to upgrade a student or one upgrade program that is better than any other. It all depends on what your students want and if you can provide that extra service.
The latest stats on up-sells show that:
- 4% – 7% of people will buy if the offer makes any sense at all
- 8% – 16% of people will buy if you make a compelling offer
Depending on what you are selling, without an upgrade program, that could be a lot of money you are leaving on the table. And you can follow up with 2nd and 3rd up-sells as well.
If you are considering creating an up-sell program at your school it can literally be anything that adds value to your students experience. You want to see what types of things that you can add that have a high perceived value, but have low actual cost to execute.
For example, with a Leadership program you could add one class a week which wouldn’t cost you much but your time and some materials. But the perceived value of teaching public speaking skills, assertiveness, leadership traits, etc. has a very high perceived value to students and parents.
The other aspects of successful upgrade programs are, programs that sell:
- Sell Personalized Service
- Sell Customization
Maybe you can create a package that includes private lessons, specialized competition classes, a women’s only class, kickboxing, MMA – the list could go on and on.
Give yourself 10 minutes to brainstorm some ideas on what you could offer your students. You know your students and your community best and you know what they want.
Most Taekwon-Do schools that have an upgrade program charge an additional $30 – $50 per month per student and you can easily do the same.
Please share in the comments sections below if you have an upgrade program and what you offer. Or if you are thinking about starting one, I’d love to hear you ideas!
About the Author:
Mr. Karstadt is the founder of 1 TKD Consulting and owns the longest running ITF Taekwon-Do school in Arizona, Karstadt Taekwon-Do in Phoenix, AZ with his father Master David Karstadt. He has been training since 1984, earned his Black Belt at the age of 8 and is currently an internationally renown intstructor teaching the culture, discipline, leadership and business skills of Taekwon-Do in classes and seminars to Instructors around the world. He has been a member of eight U.S. Taekwon-Do Teams and has traveled to 14 different countries competing in Taekwon-Do winning numerous medals at the World Championships and in international competition, most notably winning the 2004 World Championships in South Korea with two gold medals and the Men’s Team All Around Trophy. Mr. Karstadt currently resides in uptown Phoenix, Arizona with his wife and three children. Mr. Karstadt can be contacted by e-mail at firstname.lastname@example.org