How to create a social fitness club that brings in $250k revenue (Part 2) (Interview with Kelly Howard)

Highlights from the interview

[02:28] – What does it cost to run an activity-based company

[06:27] – The surprising way to ensure a great social event

[11:38] – Kelly’s secret weapon that kept the community going online

[20:01] – The decision and life change Kelly made to become location independent

[25:23] – Different ways to promote your business that isn’t just social media posts

[32:07] – 2 Big tips to follow to find success as a fitness entrepreneur


About our Guest

To know more about our guest, visit the first part of our interview.


Edited transcription of Fitness Business Secrets Podcast, Episode 50

What does it cost to run an activity-based company

[02:28] Kristy: That’s interesting. You’re kind of using all these different methods that were relevant 15 years ago to build the base and still definitely could be useful now. I did a lot of flyers when we’re pushing the gym.

What is the business model? What costs the most amount of money? Because it sounds like you’ve got all these volunteers for the events. Let’s talk about in today’s age, what does it take to run the business? What costs the money? What costs the time?

Kelly: For my current business, probably I spend a lot of money on assistance and stuff like that. I spend money on software. The money is shifted. That first website costs $25,000 or $30,000 to build. You don’t spend that now, but you’ve got all this software that makes things work. Personally, I think that you should just get the best stuff, figure it out and run with it. I’m going to be very mean here, but get the free version of MailChimp and get by with that? Forget it. Spend the $50 on an active campaign and get something that works.

Sometimes you just have to look at it as the fact that it’s a business expense. If it hurts to think about it, think about the fact that it’s only really going to cost you half because you’ve got taxes, and then you just suck it up and spend the money. I do spend money on Facebook advertising. I do a little AdWords, but not a lot because I like to understand where my money’s going and I’m not an AdWords expert yet. If you’re spending a dollar to $10 a click, then you want to know what you’re doing.

I still think email is one of the most brilliant things you can do. You really have to have an email list and you have to talk to people. Even if you’ve got a gym, you still have to be talking to people and not just face to face, but you need to be emailing them. You need to be keeping them in touch with what’s going on. We have to be relevant. 

A very good example is my pilates gym charge probably eight times what my regular gym charges. It’s a big difference, but the pilates gym keeps me advised on what’s going on and they stay in touch. They do all the right things, so they stay relevant. I’m willing to spend for both of them. 

You really just have to be willing to suck it up and spend money on marketing, and marketing can be very simple. 

Kristy: For these kinds of examples of expenses, is this for the Bayou City Outdoors business, the social club, or for your current business? 

Kelly: For all of them. Those marketing things, advertising, software, it adds up some, but if you get something that works, then you’ve got to find the people that can work it too. I truly believe in finding good people and paying them well and keeping them as long as you possibly can. I have someone who works for me. She’s in Hungary. She started with me in one of my past companies, so probably 8 to 10 years ago. She’s still with me. I’ve never met her in person, but she’s just been taking care of me for years.

So, I think it’s super important to look for good people.


The surprising way to ensure a great social event

[06:27] Kristy: For the business model, it’s a little weird to talk about now since people aren’t really meeting, but I’m sure there’s going to be a point where people are meeting again.

If someone wanted to start an activity club, what are the main things of the business to make it successful? Should you have a certain number of events? Of course, you need people on your mailing list. How many people do you need to run?

Do you need to show up to all of these events? What’s a simple way to decide?

Kelly: If someone wants to do an event company, I think that at least initially they need to be willing to do as many of them as they can because even though the events are being run by someone else, you are the face of the company.

I am a big believer in the fact that we are the face of our company. You have to always figure out a way to walk the line. The line is how you are the face of your company and still removed enough that when you decide that it’s time to sell your company, which is usually eight years in, that it isn’t going to just flounder because you’re gone.

I would say that it’s better to have quality events than a whole bunch of events. For me, I know that I was willing to pay people to be at events, even though I might have volunteers because I wanted those events to have a certain standard. 

Kristy: Like a certain number of people there?

Kelly: A certain number of people, but a certain value.

Kristy: Like social people that keep the conversation going? 

Kelly: Yes. They can keep the conversation going. They can answer questions. They can make sure that if the event leader is late or something, they’re there. In anything you’re doing, you have to be professional. That is probably the difference. If someone wanted to start a social club, they could really shine when something is run a hundred percent by volunteers and it looks like it’s run a hundred percent by volunteers. 

Anyone who’s on the call who maybe has a business or a gym, and then they have that person who puts out a sign two blocks down that says, “We’re going to meet outside and do gym stuff with you twice a week or whatever.”

That’s fine. As long as you can stay personal, relevant, and professional, that person’s going to go away. They always do. I think I got off topic though. What else were you asking? What else to do to start a membership?

Kristy: You were saying about how you made sure the events had certain qualities, and I think for some people, it’s very  confusing. What do you do? You have people hiking, but it sounds like you even went into the detail of making sure the social aspect of it was a certain standard by having very social people there. 

Kelly: Yeah. Not everybody’s social. In my world, this whole staying at home thing hasn’t been that big a deal because I’m quite frankly a huge introvert, but when you put me in front of people and it’s a group, I want to make sure that every person there is happy. I want to make sure that nobody’s left out. These are super important because that’s where having either somebody there who’s representing you or you there makes such a big difference. 

It doesn’t matter if someone is 15 or 50, they are still going to feel just like that first day of kindergarten, when they come into a new group of people. Everyone does, and someone has to be willing to take care of them. 

Let’s say you’re doing an event that is about osteoporosis. Nobody wants to be that person who comes in and then just has to kind of stand in the corner because they don’t know anybody. They don’t know where to sit or something. Someone has to be willing to be there and talk. I think that’s probably the most important thing. 

Even in gyms, it’s the same thing. Going back to my two gyms, with one of them, one of the reasons I probably stay there is that when I walk in, they’re like, “Ms. Kelly, what are you doing? Where have you been? We haven’t seen you.” 

Even though it’s very hokey because it’s a very small gym, it’s still the same thing. It makes you feel warm and fuzzy. I think the personal aspect is one of the things that will keep people coming back to a business. Whether it’s gym, pilates, an outdoor activity club, a coffee shop, that’s going to keep people. They come in because of your marketing. They stay because you love them.


Kelly’s secret weapon that kept the community going online

[11:38] Kristy: It sounds like you really made sure that the core product was awesome, along with those fine details. So, number one is show up to events, create this basic step-by-step thing, or at least make sure that you have the people there too to make sure everyone feels included, even if it’s just the hike. There’s a line of people at the end and in the beginning, and I get it.

I’ve been at things where I just felt really not included and I thought, “What am I? In kindergarten? Let’s get with it.” It wasn’t a great experience. 

I know you mentioned people. Since it was different events at different places, was it the email list that kept sort of that baseline sense of connection?

Kelly: No. It’s a membership website where people log in and they have the ability to see all the details of an event and extra things in the library and stuff like that. They can talk to each other through the website. The website itself has a lot of bells and whistles. So, people are meeting each other and they can reconnect, and they can see who’s going to an event and they can drop an email to somebody.

It’s the online equivalent of having a storefront. So, having one that’s just like a website that is a membership site that people just really feel like being a member of it is something special.

The special way to choose your events each month

Kristy: Wow. That’s great. I can see that. Just looking at the website, which I have pulled up, you wouldn’t be able to see that. You could see who’s coming and the community connection aspect. So, number two is having this website, and also you have all these great pictures on it to show the sense of energy of everyone having fun and connecting.

To get these places to do these events, do you usually do it where it’s a reoccurring event every month, so that it’s kind of in place? 

Kelly: I think it’s good to have some reoccurring and some different because people will get bored with the same old, same old, but some people like the same old, same old. So, you have to mix and match for people.

Kristy: I saw that you guys have a water polo, and so they pay your membership fee. 

What Bayou Social Club charges for membership & events

If you’re just watching, it ranges depending on the number of months you sign up for. It’s between $20 to $22 a month. That’s what I thought I saw. 

Kelly: I don’t think you can actually do a monthly anymore now. I’m not positive since I don’t own it anymore, but I don’t think you can do a monthly anymore. It probably breaks down depending upon what number of months you buy or something like that, and whether you’re a single member or a couple members. 

Kristy: Besides the membership, they also have to pay for just the cost of the activity. 

Kelly: Correct.

Kristy: To what extent? I’m just wondering, since I used to run a tennis school, were there lessons? Was there anything where they’re learning something or that wasn’t really part of it?

Kelly: Amy, who has the company now, has an online hiking course where they can learn something like that. I know that when I ran it, I taught some things, but not where you have to pay me a hundred dollars and I’ll teach you how to go backpacking. A lot of what the members got was a lot of teaching. So, Amy just has taken it to a higher level now with the online course. 

How to add revenue by offering group trips

Kristy: Were there any add-ons or was it just membership? 

Kelly: Travel was the only big add-on. 

Kristy: Did you guys have special getaways? 

Kelly: It was a lot of fun trips all over the world. 

Kristy: I’ve always thought that it just seems so interesting, but then I’m like, “It seems like so much work.” 

How was that as a portion of your revenue? Was that a big portion doing those getaway trips? 

Kelly: I think it was just a little bump with lots of fun.  

Kristy: How much would you charge for that? Do they just pay a certain amount, and then all the costs they just pay for directly?

Kelly: It totally depends on which trip it was. Sometimes we used a tour group and sometimes we did them ourselves. It’s just wildly varied. Travel is very cool. It’s a tough one right now, but it is very cool. People love it. 

Kristy: I think that if you’re a yoga teacher or you’re a cyclist, that’s an interesting business model for fitness coaches who want to take people on these fitness adventures. Were there any partnerships that either were paid or in a sense either you paid or they paid you?

Kelly: If we used an outside tour group, when I say tour, not like a bus tour, but like REI or G Adventures or somebody like that. There were partnerships that way. 

Kristy: I think a lot of people are wondering because I think in a small business like this, every stream of revenue counts. Even if it’s just a couple thousand here and there.

Were these considered sponsorships where they would pay you to have either a name or was it a certain percentage? 

Kelly: It varies. Once again, it was kind of out of sight, out of mind, so I don’t know. I do know that if you have people who want to do a retreat or something like that, they can go out and they can find a tour organization that they want to work with. That tour organization will work with them somehow. There’s a lot of different kinds out there and they will definitely work with them somehow. Usually, it’s  not so much a sponsorship as it is probably some sort of commission, but it really varies.

It varies by every company that you’re going to talk to. So, if you have people out there who want to do that, I would say that they should figure out where they want to go, what they want to do, and then find the best people in the area. Give him a call and see what they would do with them. 

What to do when your business plateaus

Kristy: I know this might be something that’s also out of sight, out of mind. What would you say your new membership signup was and your cancellation rate was?

Kelly: I don’t know. I do know that we had a pretty low cancellation rate in the industry, but I really can’t tell you what the number was. 

Kristy: I’m wondering because you are net positive. It’s I don’t know what your numbers were when you sold it, but you said you had about 1,000 members.

Kelly: Probably about that. 

Kristy: Did it feel like it was generally easy to maintain that and it was just generally a growth path? 

Kelly: Everything hits a plateau. When something hits a plateau, then we would have to figure out different ways of marketing or different ways of keeping members happy.

It could plateau in the first two years or 10 years or whatever. When you hit a plateau, that’s when you have to go, “Am I happy at this plateau?” 

If I’m not, what am I going to do differently? How am I going to do this differently? It’s just life. It’s business.


The decision & life change Kelly made to become location independent

[20:01] Kristy: It sounds like you’ve given everyone the very basic building blocks of doing an activity club, and we’re all waiting to see what will happen in the world.

I’m curious  about your new projects. I know you have a podcast and your fitness business. If you could tell everyone where you are  now with your new ventures, I’m sure they’re very exciting also. 

Kelly: Yes. So, I decided that one of the reasons that I sold the company was I wanted to be location independent, as much as I love that company, because I think it is brilliant.

It also was Houston-based so I could travel, but I couldn’t travel all the time. I wanted something that was location independent. I do some one-on-one coaching, but mostly what I do is I have a few eight week coaching programs. I do digital courses, which I love. I’m a huge fan of small digital courses. I have one that we just launched called Motivation Multiplier Method, and it’s just a small, easy, online course that people can use for three and a half minutes a day, and they’re done, which I think is super important. 

Then, there’s the whole eight week program. In between those two, I do accountability groups. I think accountability is important to help someone build habits. I don’t want  someone to  need me for the rest of their life. I want someone to enjoy working with me for a few months or a few weeks, and then be completely self-sufficient  because that’s the goal. The goal is to have fun and go have some adventures and do it all on your own.

The podcast we talk a lot about. I do some interviews, and then the rest of the time we talked a lot about motivation and habit shifting because when we shift our habits, we change our lives, mindset, accountability, and then nuance things. Then, I do throw in some adventure stuff because you cannot keep me off the trail. If I can teach someone how to go out and get what they need to go kayaking, backpacking or hiking, I’ll answer questions. I love that stuff. 

Kristy: You’re location independent. So, are you still based in Texas right now?

Kelly: I am. Right now, we’re kind of hanging out in Houston.

Kristy: Just when you can travel, you can catch. You’re going to be ready. When the time’s right, your current business is location independent. You have a couple of digital products, virtual coaching groups. Just to let our listeners know, your podcast is Fitness is Freedom, right?

Kelly: Correct. 

What led to Kelly waking up one day and unable to move

Kristy: They might not have been able to pick up on that since you’ve talked a lot about motivation and health and everything.  Would you say you’re more of a fitness coach then or more of a health life coach? 

Kelly: I am more of a mindset coach. To me, the mindset is fitnes, and that’s where the name came from. If someone is fit and is healthy in their body and their head, then they can do anything. I had a time in my life when I was still working so much and I was taking care of my mother. I was acting as the general contractor for the new house. I was doing all the things.

Then, one day I woke up and I couldn’t move. I had hurt my back. That happens to everybody because I just overwhelmed myself and I realized at that moment that if we don’t take care of our health, then nothing matters. I can make all the money in the world, but if I don’t feel good, I’m screwed. So, that’s where it all came from. 

That’s where I became so passionate, and it started because I have all these female friends who are entrepreneurs, and most of them are a little bit younger than me. I look around and I see what they’re doing. They’re working like crazy women. People in the fitness industry are working like crazy women.

We all think that we’re immune. We all think that we’re in good enough shape, but the truth is that we have to take care of our health. If you do take care of your health, you can do anything. I can do anything I want to right now. I can go jump in a whitewater river. When I can travel, I can go race canoes. I can do anything I want, but it comes from having that base of fitness.


Different ways to promote your business that isn’t just social media posts

[25:23] Kristy: You’re talking about fitness as kind of the core of your lifestyle and messages. Now that we’re online more, how do you get your message out? How do you get people buying your products and your group services?

Kelly: Back to the basics. I have a nice email. I do a lot of media. I’m on a lot of summits these days because it seemed to be the thing. I’m in a lot of television interviews. I prefer television over radio. Over the days I’ve found that television is just a little bit more powerful, but I don’t mind jumping on the radio. I’ve done it before.

I do some articles, but it takes more of my time than I really want to spend. I do some Facebook advertising. I use some word of mouth. I am not above. Just dropping a note to a friend and saying, “Hey. This is what I’ve been up to. Keep me in mind.” 

Not that I expect them to come work with me, but I get referrals. I get a lot of referrals actually. I think I mentioned Facebook ads. Those are probably the main ones: media email, the website downloads, and Facebook ads. I’m sure there’s a thousand other things in there because you know we spend thousands of dollars a month, so we must be doing something.

Why you still have hope if you don’t like social media

Kristy: I know how that feels. Everyone’s going to ask this is. Is social media a really strong channel for you? Posting things on your feed and etc.

Kelly: No. I’m the worst at social media. If I have a choice, I would rather write someone an email than make a post on social media. I literally buy my way through social media because I  know that the days of the organic fund are gone. I used to have all the fun in the world with organic reach. As soon as it became a pay to play world on Facebook and Instagram, then I’m just like “Fine. It makes it easier for me because I just pay.”

I post, but I have fun with my posts. I do things that make me happy. I’m not going to sit around and figure and stress over whether I got 10 likes in a post or two, because especially for the people who are on here and have a business page, business pages don’t have organic reach. They just don’t. 

I am probably the most positive person in the world, but I’m also smart enough to know that when something’s just not happening. If someone’s on here and they use their personal page, you can get away with that. You have to be careful because if they feel that you’re using your personal page for all your promotions, they will throw all of you down to nothing. Groups are obviously more powerful, but you’ve gotta be willing to get in there and show up.

I’m happy to do live videos. I do live videos on my page all the time, but then I promote them. 

Kristy: Yeah. I have my own struggles with social media because I’m not someone who wants to randomly post. You can still be strategic, but the reach is so low and it’s not something that’s easy to leverage in multiple ways.

I also wonder, does it really add value to my followers as much as doing an interview?  I’m always wondering what other people are doing. 

Kelly: I think that we are strategic. I guess I sound like I’m not at all, but I’m extraordinarily strategic about my marketing. I usually do three month plans and I know exactly what we’re going to focus on, but that is as much the podcast, as the emails, as the advertising, some of the posts, and then the rest of the posts. Today, just for grins, I put the two guys in kilts that are the exercise guys. 

Kristy: I have not seen that. 

Kelly: Look them up. They’re hysterical and cute. I put them on the page and it’s like, “Why not?” 

Do something different. You’re not going to spend all my time. Just trying to get somebody to download something when I can have a little fun too.

How Kelly creates multiple pieces of content from a podcast

Kristy: How about your podcast? How do you feel about your podcast? Does it create leads for you or I’m not sure how often you post ?

Kelly: We do a podcast every Monday, and then on a lot of Fridays, I do an interview. When you’re doing a podcast and you’re getting interviewed or you’re interviewing people, you’re getting reposted on their stuff. So, that’s nice. We get leads. I sound like we’re just kind of tossing stuff out there, but we’re super strategic. We take our podcasts and every week somebody on my team creates an image, an audio, and a soundbite. It goes to our LinkedIn page and our Facebook page. Then, we recycle.

We get leads. I wouldn’t say we get thousands of leads because even people I know who have very big podcasts, they have said to me before that they get leads, but they’re not getting inundated, but at the same time, I think a podcast is super effective way if you like talking to people.

I love speaking. I love being on stage. That’s one of my passions, and podcasting is allowing me to do kind of that without getting up  on stage. 

Kristy: For your podcasts on Mondays that are not interviews, is that just you on a topic and how long is that podcast?

Kelly: It’s usually about 20 minutes. I try to keep them at 20 minutes. Sometimes it’s a little shorter, and sometimes it’s a little longer. I want people to be out doing things, so I’m like, “Can I use this 20 minutes to do some sort of walk or whatever it is that you need, and then get busy thinking about the things you should be thinking about?”

Kristy: How scripted is that for you? I’m just curious since you’re the only person. 

Kelly: It’s not. Originally, it was ridiculously scripted and it took hours to do a podcast. Eventually, I was like, “What am I doing?” 

I wanted it to be perfect. It was like being on stage. If I give a speech, that speech is going to be really good. It’s going to be nailed down to the second knowing what I’m going to say. Then, I realized that the podcast isn’t like that. It’s a conversation. So, it’s a lot less scripted these days. Just talking points and that’s it. 

Kristy: How much engagement do you get from that? I’m curious from being a podcaster myself and still trying to figure out the whole thing. It can be a lot of time. For us, we do an intro and we do other things and music. So, I get the idea of how much time you put into it. How do you tell besides just the numbers of downloads, if you sense people are listening or responding?

Kelly: I’ll get emails from people. Occasionally, I’ll have a friend who’ll be on a hike or something. she’d be like, “I liked what you said the other day.” 

I’m like, “Really? That’s interesting.” 

I get comments sometimes. Mostly it’s via email though because we do a weekly email and I do mention the podcast in there and I do ask for feedback sometimes. So, you get to hear what people have to say that way. 

How Kelly Integrates her Facebook group to attract leads

Kristy: Would you say that the main things that you offer or provide in sort of your lifestyle fitness coaching business is the podcast? Then, you do a weekly email and you kind of have some social stuff and some opt-ins.

Kelly: You mean in how I’m putting myself out there? 

Kristy: Maybe somebody who follows you and they buy some things from you. Your baseline ways of the strongest connection. Some people are all Instagram. Some people are podcasts and have email newsletters.

I’m just curious. It sounds like the main baseline of people where they stay connected with you is the podcast and your new emails. 

Kelly: That’s true. I also have a private Facebook group and that gets pretty active. 

Kristy: So then, you’re probably in there a lot. 

Kelly: I’m in there. I’m actually very careful to let people know that I’m not that person who’s going to be in there every day, five times a day. You let somebody know upfront, and then they understand. Then, they take care of me because they take care of each other. So, I think that’s helpful too. 

Kristy: Basically, your goal is to build your email list, maybe your Facebook group, and then from there, people might buy some of your digital products or group services. 

Kelly: People do buy. Just be out there and be helping people.


2 Big tips to follow to find success as a  fitness entrepreneur

[35:17] Kristy: That’s really interesting. Well, thank you for sharing that because just understanding your digital model, for me, that was extremely interesting for the Fitness Business Secrets. I think a lot of health coaches are trying to understand how they want to offer products or services.

For my closing question, what would you say for someone who’s just getting started? Let’s say a health fitness coach just lost their job and has maybe a few online clients, but is trying to figure out how they’re going to be an online entrepreneur. 

What would be maybe one or two like big tips for them to get started?

Kelly: When you work for yourself, It can be a little difficult because most of the time, you are your sole person who’s going to cheer yourself on. I would say that probably the most important thing people could do is truly schedule. 

Let me put it this way because this is a crowd of fitness experts. You would never have a week that you didn’t schedule your workouts. I’m serious about having my week scheduled for my workouts because that’s what I do. We have to do the same thing with our business. If you’re looking at your schedule, what are you going to do this week? What am I going to accomplish today? What’s my outcome for today? 

Be willing to stick to the course because sometimes it’s just not going to be easy. Going back to my Pollyanna South, I want everyone to be happy and rainbows and unicorns. The truth is sometimes it’s a bear, but give yourself a certain amount of time a day that you’re going to work. I don’t think that you should just go out and crush it. I don’t believe in hustle either. Your eyes bleed. Usually, my day is five hours and I’ve found that most people stay for five hours. They might be sitting at their computer for 10 hours, but they get five hours of real work done.

For most of us, that’s about all we got in this. Just be willing to spend the time. Don’t freak if you have to go into a little bit of debt because it’s going to cost you something sometimes to start a business, but know your books and find a couple of friends that you can mastermind with. I’ve done paid masterminds and free masterminds. What I’ve found is that they all work, but you’ve got it in you also. 

I guess one last piece is that you want to make sure that you surround yourself with people who are positive because being an entrepreneur is not always easy.

Your most important thing is to keep your mind set up. If you can surround yourself with positive people, it’s going to make it a whole lot easier. When you surround yourself with people who aren’t positive, it doesn’t work. You’ve heard of the, “You’re the sum total of the five people that you hang around the most with?”

Well, I consider some of my podcasts people that I listened to my best friends because those are the people I hang around with in my head. 

Kristy: That’s true. That’s really helpful because at this time, it’s hard to always be surrounded by positive people.

Kelly: Yes, it is. Turn the news off. Don’t look. Turn on the positive as much as you possibly can.  

Kristy: Kelly, this has been a great time. I’ve learned a lot. Thank you. We got to go way back a couple of two decades into your whole journey, and I think it was really inspiring. If anyone wants to reach out to you, I know sometimes you do coaching and you also have your own programs, how could they find you? 

Kelly: I’m going to do this because I found out just before we got on this call that our contact form isn’t working on the website. My website is fitisfreedom.com. My email is just simply kelly@fitisfreedom.com. I actually answer my own emails. First time in about 15 years, but I am answering emails. So, if you just kelly@fitisfreedom.com, I’m happy to help. 

Kristy: That’s a great website by the way. Kelly, it’s been awesome. Thanks for being on the show. Make sure to check Kelly’s workout.

Kelly: Thank you.

Stay connected with Kelly!

Kelly Howard

Facebook: Kelly Howard
LinkedIn: Kelly Howard
Website: Fit is Freedom

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