Bove Consulting

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BOVE
University of Melbourne Faculty of Economics and Commerce Bove Consulting

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Service Audit City Yoga

Executive Summary | University of Melbourne

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Executive Summary

Yoga is a rapidly growing area of the health and fitness industry in which dedicated studios generally compete on the basis of instructor expertise and augmented service offerings. City Yoga, located in Melbournes inner-city, is a sole proprietor managed studio specialising in the Shadow form of Hatha Yoga. The studio effectively uses physical evidence such as ornate furniture, incense, open space and light to create a pleasant and positive mood amongst customers, influencing a positive service evaluation across its four different class streams. The studio currently enjoys optimum demand in a range of classes and a group of loyal and devout customers. City Yogas strategic priority is to maintain its market share, with a desire to retain more of its Beginners course participants as regular attendees. The facilities and sole-instructor pose the most challenging aspects for analysis and growth of the business, with associated issues relating to supply and demand management, brand image and continuity of service. Through an analysis of City Yogas current service offering, respective to the competitive environment, customer feedback and growth potential, Bove Consulting recommends that City Yoga prioritises relationship marketing and differentiating service offerings as a means for retaining customers and seeks alternative forms of supply (instructors) to ensure continuity of service in the sole-proprietor run business. In the longer term, City Yoga would be wise to consider diversifying its service offering to include related fitness or spiritual services, to enhance the brand value to customers, maximise available space and generate additional revenue. Bove Consulting gratefully acknowledges Mr Peter Ujvari, the owner and proprietor of City Yoga, for generously provided his time via a series of interviews, customer surveys and participation in yoga classes.

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Table of Contents
1 2 3 Executive Summary................................................................................................2 Introduction............................................................................................................ 5 Situation Analysis ...................................................................................................6 3.1 3.2 3.2.1 3.2.2 4 Industry Trends .............................................................................................6 Competitor Analysis.......................................................................................6 Direct Competitors.....................................................................................6 Indirect Competitors.................................................................................. 7

Customers...............................................................................................................8 4.1 4.2 4.3 Target Market ................................................................................................8 Consumer behaviour......................................................................................8 Service-Product Strategy ............................................................................. 10

Positioning Analysis ............................................................................................. 13 5.1 5.2 5.3 5.4 Brand Identity.............................................................................................. 13 Brand Image................................................................................................. 13 Differentiation ............................................................................................. 13 Recommendations ....................................................................................... 15

Service Blueprint .................................................................................................. 16 6.1 Recommendations ....................................................................................... 17

Physical Evidence ................................................................................................. 19 7.1 7.2 7.3 7.4 7.5 7.6 Ambience ..................................................................................................... 19 Space ............................................................................................................ 19 Signs, symbols and artefacts........................................................................ 19 Response to Physical Evidence .................................................................... 19 Competitive Advantage through Physical Evidence ....................................20 Recommendations .......................................................................................20

The role of the Proprietor / Instructor ................................................................. 21 8.1 Recommendations ....................................................................................... 21

Current Pricing Strategy.......................................................................................22 9.1 9.2 9.3 Competitor Pricing.......................................................................................22 Pricing Strategies .........................................................................................23 Recommendations .......................................................................................23 Promotional strategy .......................................................................................24 Recommendations .......................................................................................25 Executive Summary | University of Melbourne

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Customer Quality, Satisfaction and Retention Efforts.........................................26 11.1 11.2 11.3 Customer Survey Outcomes.........................................................................26 Customer retention strategies .....................................................................26 Recommendations .......................................................................................27 How supply and demand is managed ..............................................................28 12.1 Recommendations .......................................................................................29 Concluding Recommendations........................................................................30 13.1 13.2 Short-term 0-6 months ............................................................................30 Long-term 1-3 years.................................................................................. 31 References........................................................................................................32 Appendices.......................................................................................................33 Appendix 1 - Competitor Analysis............................................................................34 Appendix 2 Recommended strategies to reduce perceived risk ...........................39 Appendix 3 - Sample Customer Survey.................................................................... 41 Appendix 4 - Customer Survey analysis...................................................................45

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Table 1 - City Yogas Service Offering ............................................................................ 5 Table 2 - Segment Analysis ............................................................................................8 Table 3 - Current methods of risk reduction at City Yoga ........................................... 10 Table 4 Supplementary Services at City Yoga .......................................................... 12 Table 5 - Competitor Pricing Structures......................................................................23 Table 6 - City Yoga - Current Promotional Strategies .................................................25 Table 7 - City Yoga supply and demand conditions (a) ...............................................28 Table 8 - City Yoga supply and demand conditions (b)...............................................28

Figure 1 - Service Product Continuum ......................................................................11 Figure 2 - Perceptual Map ........................................................................................... 14

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2 Introduction
City Yoga is an independently owned and operated yoga studio located in inner-Melbourne. The Director of City Yoga, Peter Ujvari, is the only instructor at the studio and teaches the specialised form of Shadow Yoga. Its origins have come from martial arts helping to differentiate the studio from competitors. The studio conducts 12 classes per week, outlined in Table 1.
Class Type Beginners General Description 8 weeks duration Requires pre-booking Designed for customers wanting to learn more about prelude forms of yoga Experienced students only Requires pre-booking For customers wanting to practice individually
Table 1 - City Yogas Service Offering

Frequency per week 3 classes 5 classes

Experienced Self-Practice

3 classes 2 classes

Yoga is high in experience and credence qualities, making it difficult for customers to assess service quality. Participants generally have a high degree of involvement in the service and must commit both physical and mental effort to complete the class, in which they co-create value. It has been identified by Ujvari that his main goal for City Yoga is participant retention, particularly those completing the Beginners course.

Introduction | University of Melbourne

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3 Situation Analysis
3.1 Industry Trends
Yoga has a long-established history and has recently become a major growth sector in the fitness and health industry. It is estimated that 10 million people worldwide frequently participate in yoga (Troy, 2003) and this trend is set to continue as yoga has become an accepted and popular part of a mainstream lifestyle. Troy (2003) believes that yoga will maintain its popularity because it has a broad appeal due to health benefits, as well as its spiritual nature. Indeed, an increasing number of private heath insurance funds are now recognising yoga as a form of health-care. Data from Euromonitor International (2007) suggests that over 50% of the adult Australian population is physically active, which should support the growth and popularity of yoga. Statistical data suggests that yoga will continue its popularity within Australia, as the typical demographics of a yoga customer increase, including: Females aged 25-34 who hold considerable purchasing power as they now delay children and marriage to focus on goal attainments and lifestyle Baby Boomers who are looking towards alternative healthcare and leisure activities in their retirement Young Adults with large disposable incomes, open to new trends and like to look good However, industry growth may be inhibited by the time-poor population, as people may forgo the opportunity to partake in yoga classes or may instead opt to practice yoga at home through self teaching videos and DVDs.

3.2 Competitor Analysis

3.2.1 Direct Competitors

There are a number of yoga studios located within and around the Melbourne CBD with similar core service offerings and pricing strategies, considered

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direct competitors to City Yoga. Appendix 1 provides a detailed table describing three direct competitors chosen for analysis. Breathe Wellbeing: The breadth of styles offered have a broad appeal, making the studio more accessible to beginners. An extensive timetable offers a wide choice of class times, helping to keep class numbers small and ensure personalised service. The main point of differentiation is their hospitality, providing a relaxation lounge and a range of free organic fruits and teas. Yoga Arts Academy (YAA): A dedicated yoga studio that teaches one style only, YAA is branching out into other forms of Eastern exercise. The instructors also provide more extensive teachings in the spirituality of Yoga which allows them to differentiate their offering. The no frills studio is only open during class times. Matrix Pilates and Yoga: Matrix also specialises in only the one form of yoga, but is more commonly renowned for their Pilates classes. Small classes and individual attention is the focus and little emphasis is placed on spiritual elements. Matrix is able to offer a wide variety of class times which may be a drawing card for busy city workers and residents.
3.2.2 Indirect Competitors

As City Yoga operates in the Health and Fitness industry one of the largest indirect competitors would include independent and franchised gyms that are located in the city, in particular those that offer yoga classes. Less timeconsuming methods to practice yoga without attending classes such as self practice through at home DVDs and self-directed exercise (walking, swimming, running) also form indirect competition.

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4 Customers
4.1 Target Market
The following market segmentation is based on customer survey information and identifies how City Yoga competes on theses aspects1. In summary, the market City Yoga is seeking to attract are University students and local workers who prefer to attend classes in the before or after work, seeking fitness and wellbeing along with a high quality service.
Attributes Aged between 25-55 City Yogas Performance City Yoga is well represented in this area and has a distributed spread of participants Reflected in the ability to purchase passes or bulk visits. Evident in City Yogas class times and those of its competitors Evident throughout the customer survey (Appendix 4) and the growing value-add services that competitors are providing Yoga is considered a low impact exercise compared to other contact and non-contact sports and athletics As the majority of these consumers are employed they are considered time-poor as there are limiting factors as to when they can attend classes and the distance they can travel to obtain the service. Although these consumers are employed they are sensitive of the perceived cost and value of the service that they are consuming.

Employed

Value high service quality

Seeking low impact physical fitness and therapy Relatively time poor

Cost sensitive

Table 2 - Segment Analysis

4.2 Consumer behaviour

Customers perceived risk in the choice of yoga studios is escalated because of its intangibility and inseparability and its experience and credence properties.
1

Note: no differentiation has been made between male and female, it is acknowledged that there is a bias towards female consumers

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Table 3 outlines possible perceived risks current strategies employed by City Yoga to reduce them. Promotional materials presently provide the most benefit in reducing perceived risk. Physical evidence (Section 7) and service delivery (Section 6) also involve methods of reassuring and socialising participants. Recommendations to further reduce perceived risk are integrated within this report, also fully outlined in Appendix 2.
Perceived Risk Financial Will I gain full value from a multi class pass? What happens when I cannot attend a class? Can I gain a refund for classes I did not use? Functional Will I gain the benefits I am after (stress relief, physical conditioning) Will I be taught the appropriate methods of yoga? Current risk-reduction strategies Information is provided so that each customer knows that multi-session passes are non-transferable and nonrefundable.

Physical Will I cause harm to my body through practising yoga? Will I injure myself during a Yoga class? How will I feel the day after a yoga class?

Social Will my friends approve of yoga? What will my friends think of City Yoga? 9 Customers | University of Melbourne

The style of yoga practiced at City Yoga is explained in promotional materials A brief description of the instructors yoga history and teaching qualifications are also provided in promotional material. Tangible cues such as the physical space give credible evidence that the studio will provide the promised service Classes have been customised to different levels of difficulty and expertise Smaller class sizes means the instructor has a greater capacity to offer individual help, reducing the risk of personal injury The instructors script and the posture examples ensure that students know what to do and how to do it Throughout the classes the instructor encourages students to go at their own pace Photos show students relaxed and comfortable. Promotional material depicts the benefits of practicing yoga at City Yoga to alleviate anxiety

Bove Consulting Perceived Risk

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Current risk-reduction strategies The use of proxies of different ages and gender in the promotional material allay social fears Classes have been customised to different levels of difficulty and expertise Smaller class sizes means the instructor has a greater capacity to offer individual help, reducing the risk of personal injury The instructors script and the posture examples ensure that students know what to do and how to do it Throughout the classes the instructor encourages students to go at their own pace Photos show students relaxed and comfortable

How is yoga perceived these days is it outdated?

Psychological Will I be able to perform the poses in this class? Will the other participants judge me? Will the instructor make me feel uncomfortable? Will I fit into the culture of this studio?

Table 3 - Current methods of risk reduction at City Yoga

4.3 Service-Product Strategy

Shadow Yoga provides a more physical workout than the more common forms offered by competitors. City Yoga caters to a niche market as this form of yoga has a larger appeal to men and customers who are seeking strong physical health benefits. Participants in City Yogas small classes receive highly individualised attention. Such service would not be possible in a yoga studio that aims for high volume class sizes. On the service-product continuum (Figure 1), City Yoga is positioned as a pure service, relying very little on technology or equipment in delivering the service. Physical evidence and quality of personnel are the key elements in providing customer satisfaction.

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Figure 1 - Service Product Continuum

The following service properties impact considerably on City Yogas management of the service provision and overall customer satisfaction. High Intangibility: It is difficult for customers to evaluate a yoga class before experiencing it. Intangibility raises perceived risks for customers and therefore tangible cues and service information are provided to alleviate fears. Moderate Heterogeneity: With only one instructor, heterogeneity from a personnel perspective will be minimal. Variations in the service will still occur depending on the class size and participants, possibly impacting on service quality and the customer experience. High Perishability: The service can only be enjoyed if customers physically participate in classes. As customers do not have to pre-book for many of the classes it is difficult to predict demand, carrying the risk of needing to turn customers away without notice should classes fill to capacity. High Inseparability: The majority of the time a customer spends at City Yoga is spent receiving and participating in the core yoga service. The instructor plays a crucial role in the experience and overall quality and satisfaction of the service, without him the classes could not be provided.

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City Yogas core service is the teaching of yoga, the element where customers derive and co-create the most value from the service experience. A selection of facilitating and supplementary services in Table 4 add value to the service, although opportunity exists for City Yoga to enhance its hospitality to match or innovate from that offered by competitors, in particular Breathe Wellbeing. Furthermore, ability to handle exceptions relating to expiry dates on multisession passes is required.
Facilitating Service Information Order-taking Payment Value-add to customer Brochures, website and helpful instructor provide information to customers to reduce mental effort Bookings are taken for Beginners and Experienced classes Cash-only business may be inconvenient for customers who prefer to use EFTPOS, Credit Card or direct debit and may reduce sales of expensive multi-session passes Value-add to customer

Instructor is available for discussion about aspects of yoga and spiritualism Safekeeping Customers place their belongings into large wooden pigeon holes for safekeeping during the class Opportunities to add value with other Supporting Services Hospitality Enhance waiting area presentation and warmth with couch, water cooler, urn with tea, fresh fruit Exceptions Restitution strategy in place when instructor is ill and cannot take the class (refer also to section 8.1) Ability to extend expiry date on multi-session classes in special circumstances (injury, medical reasons, holidays)
Table 4 Supplementary Services at City Yoga

Supporting Services Consultation

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5 Positioning Analysis
5.1 Brand Identity
City Yoga is positioned as a boutique yoga studio offering a specialised style to small classes, to differentiate from competitors. This message is consistent in promotional materials and in how the service is delivered. Physical evidence and promotional material focus on the instructor Peter Ujvari as the brand identity (his image dominates promotional material), supported in the customer research which clearly identifies that City Yoga was chosen for the instructor and the majority would not continue using the service if Ujvari was no longer the instructor.

5.2 Brand Image

Concern exists that the majority of participants associate the brand with Ujvari and not with the establishment, implying that even if additional instructors were sought to deliver the service (discussed in section 8) participants would not attribute the same qualities to City Yoga nor the new teacher. Key elements of City Yogas brand image, derived from survey results, are: A highly specialised service offering, delivered with a passionate interest and high quality service High level of trust and confidence in the service provider Personalised service delivery with attention to ensuring that participants are able to access the full benefit of the service

5.3 Differentiation
As described in section 3.2, yoga studios use the following points of differentiation: Specialised service provision where one type of yoga is taught Augmented offerings where additional core and supporting services are provided in addition to yoga classes

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Multiple service providers within the same location - where multiple classes can be held with multiple teachers.

City Yoga competes as a high quality and high personalisation service provider, with indirect competitors such as Fitness First providing a very low quality and personalised service in regards to Yoga classes. The perceptual map below attempts to position City Yoga in respect to its competitors. This is created using perceived quality and status against personalisation of service, attributes that City Yoga and its competitors compete to provide.

Figure 2 - Perceptual Map

It could be considered that as the competitive market matures City Yogas position may become untenable. There appears to be a trend in the market for service providers to augment their service offering by providing a variety of experiences including other forms of exercise, communal areas, multiple classes and multiple teachers. Some firms create a value proposition by featuring many related product lines (Kolter, Jain C, & Maesincee, 2002), so

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this growing trend, coupled with the high price point could eventually erode City Yogas market share.

5.4 Recommendations
Establish a branding-building strategy that places more focus on the service and establishment than on the instructor Increase share of the male segment with a dedicated class for men, or consider partnering with a martial arts instructor as a complementary service Augmenting the service offering with additional services and evaluating the cost versus the overall perceived value should be considered

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6 Service Blueprint
A service blueprint applicable for City Yogas Beginners, General and Experienced classes is seen below. Given the high level of customer involvement and high requirements of customisation of each class, City Yoga operates under a reciprocal service design (Larsson and Bowen, 1989), with very few elements of self-service. Customers arrive at City Yoga either on an ad hoc basis or after booking into a course. Cash-only payment occurs upon arrival or following the class. The instructor asks new participants whether they have done yoga before, then briefly explains the format and the studios facilities, reducing perceived functional risk. Participants place their belongings in pigeon holes, enter the large class area and await the instructors arrival. The instruction comprises the bulk of the service process (approximately 55 minutes) and is where value is co-created and defined by participants. The instructor is positioned in front of the class and at times walks around the room offering personal feedback and instruction. High divergence exists in this step of the process, as every session and group of participants will be different. Such divergence is important in retaining participant interest in the class, to provide variety in the lessons and to build on skills already developed. City Yogas service production and delivery actively engages both customers and the instructor at all steps of the process. The participation of others can affect overall enjoyment and satisfaction: if the room is too crowded, if others are breathing heavily or have poor personal hygiene. The social interaction between participants before and after the class may result in extra-role behaviours, such as providing advice to new participants, advising them where to put away their belongings, a form of informal socialisation. Few bottlenecks exist in the service delivery and no steps are recommended to be replaced by self-service. Wait-time may occur whilst customers are waiting to pay for the class or to find space to put their belongings away. Given the short amount of time taken to complete these steps, combined with the small
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class sizes, such bottlenecks are not identified as a major problem for City Yoga. City Yogas service delivery is of low complexity. Whilst encompassing a large number of steps in the process, these are largely customer-driven and not intricate. The two critical incidents in the service delivery are when customers arrive at City Yoga and the instruction itself. Recommendations for improvements to the physical evidence are made in section 7.6. City Yoga should enhance its value proposition by diversifying and augmenting in the area in which customers co-create value: the instruction component. By providing service co-production opportunities and resources consistent with the customers desired level of involvement leads to improved competitive advantage through enhanced customer experience" (Lusch, Vargo & OBrien 2007:13), and further recommendations for diversification are outlined in section 13.

6.1 Recommendations
Standardise payment time to occur before class to reduce risk of customers leaving without paying Include more payment options such as EFTPOS or Credit Card, reducing effort for customers to upgrade to a pass Provide receipts to customers for health insurance claims

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City Yoga Service Blueprint

Av 0.5 Tol 2 Av 0.5 Tol 2 Customer arrives at City Yoga Av 0.5 Tol 2 Pay for Class (optional) Put away belongings Av 0.5 Tol 1 Wait for instructor Av 1 Tol 3 Yoga instruction Av 55 Tol 55 Question Time No Collect belongings

Yes Customer books into course (Beginner or Experienced only)

Av 0.5 Tol 2

Instructors advice

Pay for class (optional)

Av 0.5 Tol 2

Leave City Yoga Line of Visibility Production of promotional materials Maintain Accounting Records Production of multi Class Pass Maintain records of passholders

Maintain booking record

Legend
Cleaning of City Yoga facilities Respond to telephone enquiries Respond to email enquiries Y = Yes N = No Av = Average time taken Tol = Maximum tolerable time for customer Customer / Participant Instructor Divergence

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7 Physical Evidence
The servicescape of City Yoga is an essential element of the interpersonal service delivery and value proposition, playing an important role reducing perceived risks and influencing participant retention. The role of physical evidence is also crucial as customers will rely on the tangible evidence to form their evaluations of the service.

7.1 Ambience
Upon entrance to the bright and airy studio, participants are greeted with the smell of incense, which is both attention and effect-creating, putting them in a pleasant mood and thus facilitating a more positive evaluation of the service. Substantial noise from the traffic and crossing outside is very apparent during classes, which may create a negative service evaluation, and possibly an incentive to switch studios.

7.2 Space
Functional elements such as a desk and pigeon holes are tangible elements of the service delivery which facilitate the service flow and help socialise the customers as to their role, whilst non-functional furnishings (wooden panels, statues, fireplace) convey an image of authenticity and reliability, enhancing customer mood and increasing their level of perceived control. The first-floor location may inhibit access for customers with mobility problems. Bathrooms on the ground floor are unsigned and do not have mirrors, potentially reducing comfort levels for customers.

7.3 Signs, symbols and artefacts

Outdoor signage provides comprehensive information about class times, the Beginners course and take-away brochures, increasing levels of perceived control to potential customers. The personal artefacts that characterise the studio, as described above, send quality cues to participants.

7.4 Response to Physical Evidence

Using the Stimulus-Organism-Response model (Hoffman & Bateson, 2002) as a framework, participants respond to the stimuli of City Yogas environment in different ways. Cognitively, participants are likely to form positive evaluations of the pleasant service environment. The use of incense may create a warm emotional response as they feel more relaxed. Physiologically, customers will respond with great variety, depending on their yoga experience, exertion and expertise. Crowded
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classes or temperature extremes may cause customers discomfort. Behaviourally, social interaction between participants is possible prior to the commencement of the class. Social bonds that form between customers and with the instructor may form a switching barrier for participants. The physical evidence is designed to encourage approach behaviours, to return and attend multiple classes each week, to interact with other participants and the instructor.

7.5 Competitive Advantage through Physical Evidence

Firms in the industry can use physical evidence as a means of differentiation and to gain a competitive advantage. The weakness of City Yogas physical evidence is that it is not rare nor inimitable by competing firms, therefore it cannot form a sustainable competitive advantage. Customers may choose City Yoga because of its attractive servicescape, but it is unlikely to be an enduring factor in customer retention. As a service with high experience and credence qualities, perceptions of service quality are likely to be strongly influenced by customers experience of the service delivery rather than physical evidence, as evidenced in our customer surveys.

7.6 Recommendations
Display the instructors qualifications in the studio, reducing perceived functional risk Double-glazed windows would significantly reduce traffic noise and create a more pleasant atmosphere Affix signage to bathrooms to avoid customer embarrassment in asking directions and include mirrors for enhanced comfort

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8 The role of the Proprietor / Instructor

As an owner-operated business with no other staff, City Yoga faces severe limitations. In the case of sickness and holidays, the studio currently has no other teacher that can cover the classes. However, given the high degree of importance that current participants place on the instructor (Appendix 4), an emergency or stand-in teacher may even damage the brand and affect customer loyalty. This form of operation also means that the business cannot be sold. City Yoga must consider this issue and take appropriate steps to ensure loyal customers are not lost to competing firms when classes cannot be delivered.

8.1 Recommendations
Select or train a stand-in teacher who can be on call for emergencies Ensure a customer database exists for pass-holders, so an SMS service can notify them if a class will be cancelled Offer a free class to those who are inconvenienced by a cancelled class If the studio will be closed over a holiday period, display signage in the front window and within the studio up to 6 weeks prior, to ensure customers have greater perceived control and feel valued by the firm

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9 Current Pricing Strategy

City Yoga offers customers a casual fee ($18 or $15 concession) or a discounted rate if purchasing a multi-session pass for either 10 or 20 classes. These passes are structured such that they have a 5 or 10 week validity, enforcing participants to attend classes twice a week on average, in order not to forfeit the pass. This is a method of using pricing to control supply and demand. City Yogas pricing objectives are profit-seeking and cost-covering and therefore a revenueoriented pricing strategy is in use. This is evident in that prices are fixed and not varied based on market supply and demand nor are they patronage based where service cost is calculated on minimum revenues with differing price points for various segments and diversity in the payment methods (E.g. Direct Debit, Credit Card, EFTPOS) This pricing strategy is currently effective as a sole proprietor delivering the service from one location, but if growth is required then a patronage-oriented pricing model may be better suited. This model is being used by City Yogas direct competitors where alternate payment methods are available.

9.1 Competitor Pricing

Table 5 outlines competitors pricing structures. Yoga Arts Academy has a similar structure for multi-session passes with an expiry date. It can be assumed that demand for casual classes is inelastic as prices across providers are very similar.

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Provider City Yoga

Casual $18 ($15 conc.)

Provider Breathe Wellbeing Provider Yoga Arts Academy

Casual $18

10 Class Card $130 ($115 conc.) - 2 sessions per week 10 Class Card $160

20 Class Card $200 ($190 conc.) - 2 sessions per week Regular (6 pw) $36 per week, $100 start up 12 sessions per month $240 3 sessions per week

Beginners Course $100

Unlimited $42 per week, $100 start up 16 Sessions per month $285 4 sessions per week 20 Sessions per month $320 5 session per week

Casual Midday - $15 ($13 conc.) Evening - $17 ($15 conc.) Casual $20

8 sessions per month Card $185 - 2 sessions per week 10 Class Card $150

Provider Matrix Pilates and Yoga

Table 5 - Competitor Pricing Structures

9.2 Pricing Strategies

City Yogas multi-session passes can be considered bundled offers and the Beginners courses a special offer, components of satisfaction-based pricing that directly benefit customers by reducing payment time and cost. These bundles are also similar to the components of relationship pricing, however presently there are no benefits to customers for patronage over long periods of time, or complimentary offers, rebates or rewards for long-term patronage.

9.3 Recommendations
Focus on relationship pricing strategies, by creating offers that reward participants for patronage over a longer period of time such as membership payments Extend the time period in which the participant is able to use the passes, reducing perceived financial risk Provide clauses which extend the expiry date if a participant is unable to use the pass due to medical reasons.

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10 Promotional strategy
Table 6 evaluates the scope of City Yogas IMC activities and their reach and visibility to the target market. The strategies in place aim to eliminate the Market Communications gap to ensure what is promised to customers is in fact delivered, whilst attempting to reach potential customers both via electronic and print vehicles. Its various strategies educate customers as to what is expected, gives a sense of credibility and confidence in the instructor and creates tangible images of the environment. City Yoga produces brochures which outline the experience and yoga technique; referencing the dynamic and physical nature of the shadow style, and instructors expertise, thus reducing perceptions of functional and physiological risk through describing the service offering to the potential customer. Proxies are used to display the target customers, both males and females of varying ages. Brochures and posters are widely distributed in the local area but opportunities exist for City Yoga to increase its physical visibility to the high levels of pedestrian and road traffic that pass by.
IMC Element Web page Description Reach / Visibility

Includes description of yoga style, staff experience, timetable, pricing and contact information. Pictorial evidence on site adds credibility and reduces perceived risks. Well presented store front Quality sign writing and brand symbol and element displayed on windows DWL fold out style Photos of participants and the furniture of the studio (proxies) tangibilise the service. Display new offers,

Second entry listed in Google when searching for City Yoga

Store-front

Difficult to clearly see from a distance Store-front is partially covered by tree on foot path. Distributed to local Cafs, restaurants and new age businesses in the local area where permission has been granted. Flyer stand at the front of the store. City Yoga store front

Brochures

Flyers/ 24

Promotional strategy | University of Melbourne

Bove Consulting IMC Element Posters

SERVICES MARKETING 325-662 Reach / Visibility

Description

Word of mouth

particularly the beginners course basic yoga style and business description, dates, times and prices. Generated through positive service offering experience and customer satisfaction Multi-session passes Concession rates Discounted offer for Beginners course

Noticeboards and windows of local businesses with permission. University notice boards in CBD Where ever City Yoga customers move, interact and discuss the City Yoga Experience. Available at point of sale Listed on the website and in printed material.

Pricing discounts / offers

Table 6 - City Yoga - Current Promotional Strategies

10.1 Recommendations
Emphasise key messages of convenient location and class times, small classes, experienced instructor in promotional materials Add a location map and downloadable timetable to City Yoga website to reduce customer effort in seeking such information Include customer testimonials on website and brochure to reduce perceived functional risk and provide credibility Place an A-Frame sign outside building during class times to attract passersby and increase visibility Increase awareness by paid targeted flyer distribution through company such as avant card and to doctors surgeries, clinics, kindergartens/ child care centres Add video clips of classes onto the website to give potential customers a better feel and greater understanding of City Yoga, reducing psychological risk. Begin referral promotions whereby discounts are given when participants refer new customers. This will help encourage positive word of mouth and drive further demand.

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11 Customer Quality, Satisfaction and Retention Efforts

Promotional materials and physical evidence influence assessments of service quality, however satisfaction is experience dependent and focuses on the specific service encounter, primarily in the instruction phase of the service blueprint. Currently, no mechanism is in place to measure customer satisfaction, feedback or complaints, other than comments provided by customers directly to the instructor. Collating such information from customers is imperative for City Yoga in order to monitor the Management Perception Gap, to ensure that customer desires and expectations are understood and acted upon.

11.1 Customer Survey Outcomes

The current level of perceived service quality among customers of City Yoga is very high with all respondents to a survey (Appendices 3 & 4) indicating City Yoga met their expectations, with four indicating the City Yoga experience exceeded their previous experiences. Results suggest this can be attributed to City Yogas personalised experience, experienced instructor, convenient location and class timetable, quality facilities and small class sizes. All customers surveyed purchase the multi-session pass. The high incidence purchase could reflect the Bargain concept to the customer, propagating a feeling of reduced financial risk and post-purchase satisfaction when combined with the quality service delivery. All respondents said they would recommend City Yoga to a friend and 80% of current customers were referred to City Yoga by a friend.

11.2 Customer retention strategies

City Yoga offers a highly customer-centric service, focusing on a relationship marketing approach rather than transactional marketing to its customers. This is reflected in the survey results and the indication of strong loyalty to the instructor, respondents main reason for choosing and continuing at City Yoga. City Yoga builds customer loyalty through the personal service offering, as the instructor takes care to learn participants names and customise the offering to their level of experience. This nurturing customer-centric service assists in establishing rapport and fostering customer referrals. This also facilitates the development of
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attitudinal loyalty to the studio and citizenship behaviours such as positive word-ofmouth and socialising new participants.

11.3 Recommendations
Conduct a customer survey at the commencement and completion of each Beginners course to measure customer expectations and service quality Establish a mechanism for feedback in foyer of studio, with a Suggestions box. This private area may encourage more frequent and honest feedback. Help retain beginners class attendance by utilising a SMS reminder service of class times. Establish a mailing list of those with multi-session passes to notify customers of new courses, date and times, send birthday greetings

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12 How supply and demand is managed

There is minimal supply and demand management at City Yoga, despite the proprietors aim is to retain Beginners attendees in the general or advanced classes. Impacts of service supply and demand can be analysed for each of the main offerings and supply elements in Tables 7 and 8:
City Yoga Service Offering Beginners Class Supply Relationship to demand Demand and Supply are well balanced Lower demand than optimal supply levels Demand and Supply are well balanced Issues

Optimum Supply

General Class

Less than Optimum Supply Optimum Supply

Advanced Class

Resources utilized at an ideal rate Service Quality delivered No delays Pleasant amount of crowding Customers receive excellent individual service No waiting Lack of customers could create negative image or atmosphere Resources utilized at an ideal rate Service Quality delivered No delays Pleasant amount of crowding

Table 7 - City Yoga supply and demand conditions (a)

Supply Elements Facilities

Current State
Inflexible No possibility to expand (rented facility) or conduct simultaneous classes Demand measured by sales of multi-session passes If classes were booked in advance (reservation system) this would assist in predicability of class sizes. There is limited if any capacity to vary the service provision by manipulating the labour provided as the service is non-transferable Current instructor has limited resources, so cannot presently supply additional classes himself Current strategies are not specifically targeting participants to favour any particular time slots No incentives provided to change supply and demand (ie cheaper classes during off-peak times)

Process of Service Delivery Labour

Time Promotion

Table 8 - City Yoga supply and demand conditions (b)

Whilst supply and demand are well balanced in the Beginners and Experienced classes, the general class is over-supplied. In an attempt to level supply and demand, City Yoga has implemented a pass where customers bulk purchase classes. This method is used successfully by sports centres and gymnasiums to maintain revenues
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that allow for economies of scale but does not provide regular attendance. Current levels of supply however cannot be altered greatly, as only one instructor and limited facilities are available.

12.1 Recommendations
Whilst the current facility meets current demand levels, it does not provide the flexibility for expansion or multiple classes. Either a larger alternate location, or one that allows for partitioning, could be sought. If additional Beginners classes were run (by an additional instructor), this may positively impact the demand for the General classes. Reducing the cost of multi-session passes to those people who have attended the Beginners class would possibly increase the volume of participants converting from Beginner to General. Charge a cheaper rate for off-peak classes to shift demand to classes with less than optimal supply Targeted promotions at certain market segments can increase demand in that segment

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13 Concluding Recommendations
This report has detailed a number of specific recommendations for City Yoga in order to enhance their service offering. Identified below are short-term strategies that are considered as immediate priorities for City Yogas in enhancing the service whilst also achieving Ujvaris priorities. Also recommended are long-term strategies that should be considered in order to grow the business.

13.1 Short-term 0-6 months

Improve retention rates Enact relationship marketing strategies with participants to encourage a strong engagement with the brand. A quarterly e-newsletter outlining new course dates, promotions and spirituality will remind customers of City Yoga and assist in retention. Rename the General class as Intermediate and clearly communicate the differences in each of the class types. The term General devalues the service offering and does not represent the linear progression of the classes. Ensure classes are varied and interesting to retain participants interest in the service. Offer a discounted multi-session pass for the intermediate class to participants completing the Beginners course. Remove or extend the expiry date on multisession passes such that students have more flexibility as to when they attend classes Improve continuity of service As discussed in section 8, identifying a substitute instructor will ensure continuity of service in cases of illness and leave. This will also ensure that customers perceive greater value in the service as it will operate year-round.

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13.2 Long-term 1-3 years

Expand and diversify City Yoga should aim to build the brand and the business by changing promotional materials to focus less on the instructor, enabling affect transfer from the service provider to the firm. Identify alternative services or classes to offer in the studio during the day to utilise available space by maximising fixed costs, bring in new customers to the firm and enact affect transfer to shift customers brand image away from the current instructor to one of a studio with a range of instructors. Recommended offerings include as pre/post-natal yoga, alterative forms of yoga, meditation or spiritualism classes. Establish membership program Phase-out multi-session passes and establish a membership structure. Once the business has diversified into new areas customers will perceive a greater degree of value in the studio. Relationship marketing strategies, such as newsletters and SMS reminders as discussed in this report, should form part of this program.

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14 References
Euromonitor International Reports (2007) Health Report Australia. Retrieved from Global Marketing Information Database, 10 October 2007. Hoffman, K.D. & Bateson, J.E.G (2002). Managing the firms physical evidence Chapter 9 in Essentials of Services Marketing: Concepts, Strategies & Cases 2nd Ed, Harcourt, Orlando USA pp 220-245 Kolter, P., Jain C, D., & Maesincee. (2002). Marketing Moves. United States of America: Harvard Business School Pulishing Corporation. Larsson R. and Bowen, D. E. (1989). Organization and customer: managing design and coordination of services Academy of Management Review, Vol 14. No 2, pp. 213-233 Lusch, R., Vargo.S, OBrien, M. (2007). Competing through service: insights from service-dominant logic, Journal of Retailing, Vol 1, pp 5-18 Troy, M Yoga Trends(date unknown), retrieved from: http://findarticles.com/p/articles/mi_m0FNP/is_23_42/ai_111615569, 10 October 2007

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15 Appendices
Appendix 1 - Competitor Analysis Appendix 2 - Strategies to reduce perceived risk Appendix 3 - Sample Customer Survey Appendix 4 - Customer Survey analysis

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Appendix 1 - Competitor Analysis

Competitor A - Breathe Wellbeing Directory Information Domain name (URL) Mission statement or purpose http://www.breathewellbeing.com.au/i ndex.html "all of our directors and staff are passionate about nurturing their minds and bodies" "to create a beautiful sparkling space where people feel connected and welcomed and can benefit from state of the art equipment and teaching techniques" 289 Little Collins St, Melbourne http://www.yogaartsacademy.com/ Dedicated to teaching the physical and spiritual aspects of Yoga. Ensuring that the body, mind and spirit are all aligned to achieve maximum benefits. http://www.matrixpilates.com.au/ Consider themselves to be a specialised Mind, Body and Health centre. A place where you "can take time out from your busy day and re-energise your mind, body and spirit, and gain inspiration form other like minded people. In this sense they are quite similar to Breathe Wellbeing Level 4, 169 Swanston St Unknown Competitor B - Yoga Arts Academy Competitor C - Matrix Pilates and Yoga

Company's physical location Principal Kate Challis and Raphael Bender owner or manager Products and Services Principal product or service Supply source of principal product or service

Level 3, 360 Little Collins St Prahlad and Yatren

General Group classes in both Yoga and Pilates offering a range of difficulty levels and varying styles Professional instructor led classes at physical location

Group and Individual tuition in one form of Yoga. Classes are based on difficulty level Professional instructor led classes at physical location

Group classes, small classes and individual tuition on Hatha Yoga and Pilates Professional instructor led classes at physical location

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Competitor B - Yoga Arts Academy Evening and weekend classes: $16/$14 concession Lunch Time class: $14/$12 concession 10 Class Pass: $140/$120 concession (3month validity) Monthly Card: $150 (unlimited class attendance) Individual tuition prices range from $175 - $330 depending on sessions per week Only offers the one style of Yoga as does City Yoga. Smaller class sizes are encouraged so students achieve individualised attention. Providing a no frills attached studio, and studio is only open for class sessions Classes are divided between beginners and experienced students Competitor C - Matrix Pilates and Yoga Casual: $20 per class 10 class pass: $150

Competitor A - Breathe Wellbeing Selling price of principal product or service (Yoga Only) Casual: $18 per class 10 Class Pass: $160 Regular Pass (up to 6 classes a week): $36 p/week $100 start up fee Unlimited Pass: $42 p/week $100 start up fee

How similar is the service to City Yoga?

Secondary service Supply source of secondary service Selling price of secondary service Additional Products and Services

Also claims to have a student focus approach to teaching with an aim to individualise each class. The focus is also on the physical benefits of Yoga rather then teaching the spiritual side. However the business aim of the company seems to be on gaining large volumes of students so it has less of an intimate appeal compared with City Yoga. Breathe Wellbeing also offer speciality classes for both beginners and advanced students as does City Yoga Specialty Yoga classes such as Sleep Yoga and Pre Natal Yoga Professional Instructor led classes at physical location Same Price schedule as above Relaxation Lounge Free Green Tea and Water Free Organic Fruit Staffed Reception Direct Debit is available

Specialising in the one form of Yoga as does City Yoga. Matrix is also known for offering smaller group classes and their semi private classes (2-5 people) also allow for individualised attention and relationship building with instructors and other participants.

Naturopathy and Shiatsu as well as other forms of Eastern Exercise

Instructor programs and advanced Pilates classes

Instructor classes start at $995 over a 2 weekend period (40 hours total) Provides a range of workshops and events for students as well as meditation sessions twice a week Offering to provide associated services such as osteopathy, myothearapy and naturopathy. Also provide cardio machines and light weights to provide an overall fitness centre

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Competitor B - Yoga Arts Academy Competitor C - Matrix Pilates and Yoga

Competitor A - Breathe Wellbeing Customers and Marketing Primary target market (either listed at the Web site or surmised from their product offerings and presentation) Secondary target market Reputation and image projected by the company or Web site (in your own words, if necessary) Breathe Wellbeing states they are for "people who are not gym people". Their Clientele are most likely new to Yoga or not especially advanced. They look to attract the busy CBD worker or resident either male or female

People interested in learning the spiritual side of Yoga, not really for people interested in the pure physical side. Catered best to the extreme Yoga "junkies" May be more tailored to males People looking to become Yoga teachers. A studio that is dedicated to the hard core Yoga fanatics. The Yoga Academy provides the opportunity to learn and practice the spiritual sides of Yoga

People interested in gaining a fitness benefit from Yoga and Pilates. Workers and residents of the city both new and experienced in yoga. May be more tailored to females

As they are the CBD's largest Yoga and Pilates studio, Breathe aims at being considered the most accessible and approachable studio. They aim to present themselves as warm and friendly to attract newcomers to Yoga. Breathe also try to project an image of a sanctuary in the city, a place to unwind and find some personal and peaceful time. Sources of Competitive Advantage

A welcoming environment with new facilities and state of the art equipment. Looking to promote a gym like atmosphere, in the sense that Matrix is about using Yoga as a workout. Large, bright and spacious workout rooms project an image of exclusivity and professionalism.

In what ways does the company exhibit competitive advantage in terms of: Pricing Prices are marginally higher than City Yoga but are average for the general city Prices are slightly lower then City Yoga, however they change depending on whether you take a lunch or evening class. City Yoga's prices are constant for all classes Prices a considerably higher than City Yoga and have a limited pricing options in terms of multiple class passes and membership options.

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Competitor B - Yoga Arts Academy Dedicating their studio to a full appreciation of Yoga, enhancing the physical experience with the spiritual elements of Yoga. Combining a range of Eastern practices that compliment a dedicated Yoga students lifestyle. For example Naturopathy and Shiatsu massage. Providing a range of workshops and events throughout the year to encourage a deeper entrenchment in the Yoga lifestyle. Competitor C - Matrix Pilates and Yoga Trying to push the brand "Matrix" as a focal part of the service experience (similar to the brand/gym Fitness First). They are using a specialised focus on Yoga and Pilates as a niche in the fitness industry. Matrix is positioning themselves to be a "Mind, Body and Health" centre and not just a Yoga retreat. Their central city location and spacious premises help to push an image of exclusivity. Similar to Breathe, Matrix also offers a large number of classes every week, over 80. Matrix also offer a range of lifestyle specialists to drive their brand as a complete centre for Mind, Body and Health. They also have a plans of Myotherpay and Physiotherapy specialists to work within Matrix Out of the three competitors on this list Matrix is the one business that have placed substantial efforts into promotions. They offer a free 1 day guest membership, as well as running their 8 week workout challenge programs which drive membership sales. Matrix also provides an online booking system and an online feedback service.

Competitor A - Breathe Wellbeing Differentiation Offering a wide variety of Yoga styles that have a broader appeal to the general public. This is aligned with their strategy of being approachable and targeting newcomers to Yoga Creating an environment that is not only useful for practicing Yoga, but a place to unwind and spend personal time in Are the largest dedicated Yoga and Pilates studio in Melbourne CBD and hold over 65 classes every week The studio remains open when no classes are scheduled

Innovation

Growth

Holding over 65 classes a week and leaving the studio open when no classes are in sessionAllowing for direct debit payments and membership accounts that can be "frozen" when customers are not able to attend classes for a lengthy amount of timeBreathe also offer a guarantee - if customers are not happy with their memberships or the way that they are feeling then the membership is cancelled and the start up fee is reimbursed Offering more styles of Yoga has allowed Breathe to expand its clientele as well as combining Pilates into the product mix.

Combining other Eastern practices at the studio to enhance the Yoga lifestyle. Also helping to build the spirituality of Yoga practice at the studio.The majority of group classes held at the studio are open to all participants. For more advanced classes individual tuition is held. This helps to establish a large customer base and make a limited timetable more accessible.

Offering other practices which are complimentary to Yoga helps to expand the studio. Offers a broader appeal

Matrix are positioning themselves to open in new locations which is the reason behind pushing the brand/image.

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Competitor B - Yoga Arts Academy Competitor C - Matrix Pilates and Yoga

Competitor A - Breathe Wellbeing

In what ways does the company use management practices to: Lock in customers Create switching costs for customers Pre-paid memberships and direct debit payments Provides a reason other then working out to be at the studio. Breathe are trying to establish a social experience for their customers and not just a workout experience. Breathe also provide other extras such as free fruit and green tea which other competitors do not. This again enhances the overall experience for the customer Pre-paid memberships Offering a specialised service that is dedicated to the one form of practice creates an environment which can not be imitated by the other competitors. As the Yoga academy is a specialist studio they are likely to attract highly skilled instructors as well. Being that the practice of Yoga is has a high customer involvement the quality of teachers is crucial. Pre paid memberships and trail programs such as the 8 week workout program Building a brand that customers feel connected ane loyal to. Although there are many independent studios that offer Yoga classes, no one studio has yet to build a successful brand and grow it. As Matrix also plans to offer specialised lifestyle services they are able to become a one destination fitness and lifestyle provider.

Other Information Quality and number of employees 7 Instructors who all have formal qualifications and vast experiences. Some have trained in Bali, India and Boston. Many of the instructors also have tertiary qualifications in related fields such as health and fitness The principal owner, Prahlad is the most experienced and qualified instructor, as such he only takes individual tuition. Most other instructors and former pupils and have less training behind them and as such take the level 1 and 2 classes that are open to all students Provides details about class times, decryptions and classes. Also introduces the instructors. 6 dedicated Yoga instructors and a number of Pilates instructors as well as other lifestyle consultants. All Yoga instructors have relevant qualifications and accreditations. The yoga instructors are aged 30+.

Website available

Provides information on prices and class timetables. Also gives information regarding instructors and displays customer testimonials. Email enquiries are also encouraged

Provides information on class timetables and prices as well as what services are available. Gives a brief introduction about the instructors. Also provides a means to book appointments and give feedback.

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Appendix 2 Recommended strategies to reduce perceived risk

Perceived Risk Financial Fear of monetary loss or unexpected costs Will I gain full value from a multi class pass? What happens when I cannot attend a class? Can I gain a refund for classes I did not use? Functional Will the service have a satisfactory outcome, will it be effective? Will I gain the benefits I am after (stress relief, physical conditioning) Will I be taught the appropriate methods of Yoga? Strategies in Place Recommended Strategies Provide more class times in order for customers to gain the most value from their passes before the expiry date. Extend the time period in which the customer is able to use the pass Provide clauses which extend the expiry date if a client is unable to use the pass due to medical issues. Continue to adapt the yoga experience to meet customer demands in order for them to want to return. Print expiry dates on the multi-passes

Information is provided so that each customer knows that multi-session passes are non-transferable and nonrefundable.

Physical - The fear of causing personal injury Will I cause harm to my body through practising Yoga? Will I injure myself during a Yoga class? How will I feel the day after a Yoga class?

The style of yoga practiced at City Yoga is explained in promotional materials A brief description of the instructors yoga history and teaching qualifications are also provided in promotional material. Tangible cues such as the physical space give credible evidence that the studio will provide the promised service Classes have been customised to different levels of difficulty and expertise Smaller class sizes means the instructor has a greater capacity to offer individual help, reducing the risk of personal injury The instructors script and the posture examples ensure that students know

Provide a brief consultation for new students before they commit long term. As an incentive for people to try yoga at City Yoga offer the first class at half price. Enabling customers to establish for themselves if City Yoga is the right match for them. Provide positive testimonials from current/previous students on promotional material Display instructors qualifications in the studio

Many of the current strategies are only known to students during the participation of classes. These benefits at City Yoga need to be made available to students during the pre-purchase search. This could be done through promotional material. In the promotional material Instructor could make a promise/pledge that he will look after his students during class. Along with a description in promotional materials about the forms of Yoga taught, a description of how the class is run should also be used.

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Recommended Strategies Positive word of mouth will also help to alleviate these concerns but cannot be directly controlled by Instructor. However rewarding experiences at City Yoga will increase the probability for positive WOM.

Strategies in Place

Social Concerns about how others will think and react Will my friends approve of Yoga? What will my friends think of City Yoga? How is Yoga perceived these days is it outdated? Psychological Personal Fears and emotions Will I be able to perform the poses in this class? Will the other participants judge me? Will the instructor make me feel uncomfortable? Will I fit into the culture of this studio?

what to do and how to do it Throughout the classes the instructor encourages students to go at their own pace Photos show students relaxed and comfortable. Promotional material depicts the benefits of practicing yoga at City Yoga to alleviate anxiety The use of proxies of different ages and gender in the promotional material allay social fears

The use of testimonials and positive WOM will again reassure potential students.

Classes have been customised to different levels of difficulty and expertise Smaller class sizes means the instructor has a greater capacity to offer individual help, reducing the risk of personal injury The instructors script and the posture examples ensure that students know what to do and how to do it Throughout the classes the instructor encourages students to go at their own pace Photos show students relaxed and comfortable

If customers are referred to City Yoga by a friend or hear positive word of mouth than these fears are likely to be alleviated. Referral promotions should then be encouraged by Instructor. Building the brand and reputation of City Yoga will also help to communicate the friendly nature and service of the studio. Provide a means for more social interaction, such as a relaxation lounge, facility to make tea / eat fruit The use of TV ads or website videos, featuring clips of classes and Instructor, for promotional activity will be able to show potential customers the City Yoga experience and give them a better feel about the studio then just print ads.

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Appendix 3 - Sample Customer Survey

The survey was undertaken from September 24th to October 8th 2007.

City Yoga Customer Survey

Administered by Bove Consulting Group

Department of Management and Marketing c/o Room 115, Level 1, Old Geology Building The University of Melbourne Victoria 3010 Australia

Please mark the your answer to each question with an X in the space provided 1. How did you find out about City Yoga? _ Friend _ Brochure _ Ad _ walk in _ internet _ Other 2. How long have you been a City Yoga customer? _Year/s _Month/s _Week/s _Day/s 3. How often do you use the City Yoga service? _ This is my first time _ Once a week _ Twice a week _ More than twice a week _ Other 4. What time of day do you attend a City Yoga session? _ Morning _ Lunch time _ Evening Varies

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5. What level of yoga experience do you have? _ Beginner Go to Q6 _ Intermediate Go to Q7 _ Experienced Go to Q7 6. Do you think you will continue at City Yoga after completion of the beginners course? _ Yes _ No _ Unsure 7. When paying for the City Yoga experience do you pay as you go? Or do you purchase a multi session card? _ Single _ Multi session card 8. What is the main factor which affects how often you attend City Yoga? _ Work commitments _ Family commitments _ Class times _ Cost _ Sickness _ Laziness Other 9. Do you feel you receive the appropriate amount of individual attention during a City Yoga class? Yes No, Why? 10. City Yoga, offers its customers Strongly Disagree Knowledgeable staff Friendly supportive staff Reliable service Punctual staff Efficient staff Studio/ Facilities Quality of service Customer satisfaction Convenient timetable 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 3 3 3 3 3 3 3 3 3 4 4 4 4 4 4 4 4 4 Strongly Agree 5 5 5 5 5 5 5 5 5

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12. What factors influenced you in choosing City Yoga? _ Experienced instructor _ Friendly Instructor _ Recommendation _ Nice dcor _ Positive ambience _ Location _ Other 13. What factors influence your decision to continue using City Yoga? _ Experienced instructor _ Friendly Instructor _ Nice dcor _ Positive ambience _ Exclusivity _ Location _ Other 14. How much does the instructor (Peter Ujvri) influence your experience at City Yoga? _ Large influence _ Moderate influence _ Little influence _ No influence 15. If Peter was no longer the instructor at City Yoga would you still attend? _ Yes _ No, Why? 16. Which other exercise options would you consider before undertaking a class at City Yoga? _ Pilates class _ Gym membership _ Home Workout _ Aerobics _ Walk _ Other 17. Are you? _ Male _ Female 18. How old are you? 43 Appendices | University of Melbourne

Bove Consulting _ 16 to 25 _ 26 to 35 _ 36 to 45 _ 46 to 55 _ > 55 19. Are you? _ Working full time _ Working Part time _ Studying _ Work from home _ Unemployed

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20. Did your initial City Yoga experience meet your previous expectations a yoga service? _ Yes _ No, Why? 21. Would you visit again? _ Yes _ No, Why? 22. Would you recommend City Yoga to other people? _ Yes _ No, Why? 23. Is there anything about City Yoga you would change?

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Appendix 4 - Customer Survey analysis

Total respondents = 18 1. 2. 10 of 18 respondents were referred through a friend 4 of 18 respondents have been at City Yoga for 1-2years 4 of 18 respondents have been at City Yoga for 6months to a year 10 of 18 respondents have been at City Yoga for 3-6months 3. 8 of 18 respondents visit City Yoga once a week 7 of 18 respondents visit City Yoga more than twice a week 4. 6 of 18 respondents visit City Yoga for the morning session 7 of 18 respondents visit City Yoga for the evening session 4 of 18 respondents visit City Yoga at varying session times 5. 7 of 18 respondents are beginners at City Yoga 9 of 18 respondents are Intermediates at City Yoga 6. All beginners surveyed (7 of 18) said they would continue using City Yoga after completion of the beginners program. Only one person surveyed said they were unsure if they would continue. This person also indicated work commitments as the sole reason for not attending classes. 7. 8. All respondents purchased either the multi-session card of the Beginners program Work commitments (14 of 18) were shown as the most common cause for not attending class, followed by class times (7 of 18) and Cost (6 of 18). 4 of the 6 who indicated cost work full time with 2/8 working part time. 18 of 18 respondents feel they receive an appropriate amount of individual attention 18 of 18 respondents agreed or strongly agree with the statements of question 10 The majority of respondents indicated fitness (11 of 18) as there main reason for choosing yoga, followed by physical therapy (9 of 18), enjoyment (6 of 18) and to socialise (4 of 18). Respondents across all ages indicated physical therapy with the majority (4 of 7 who indicated physical therapy) were over 36 years of age. The overwhelming factor for people choosing City Yoga is the experience of the instructor (15/18) followed by location (10/18) and how friendly the instructor is (8/18). An experienced instructor is unanimous (18/18) reason for customers to continue using City Yoga followed by the friendliness of the instructor (13/18) and the positive 45 Appendices | University of Melbourne

9. 10. 11.

12.

13.

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ambiance (9/18). Physical evidence factors such as the location (7/18) and nice dcor (5/18) scored lower. 14. All but one respondent (17/18) rated the instructor as having a large influence over the City Yoga experience The majority (13/18) of respondents attending City Yoga indicated they would not continue at city yoga if Peter Ujvari was no longer the instructor, almost a third (5/18) indicated it would depend on the new instructor. Most respondents (9/18) indicated a low impact walk would be their preferred method of exercise over yoga. Males 6 Females 12

15.

16.

17. 18.

One third of the City Yoga customers are males 2. How old are you? 16 to 25 26 to 35 36 to 45 46 to 55 > 55 Males Total 1 1 2 1 1 2 7 3 4 2

19. 20.

14 of 8 respondents are working full time. All respondents indicated City Yoga met their previous yoga service expectation, with 4 indicating the City Yoga experience exceeded their previous experiences. All respondents indicated they would visit City Yoga again. All respondents indicated they would recommend City Yoga to other people, which is reflected in question 4 with 10/18 customers referred by a friend. One respondent indicated the beginners class is too crowded initially.

21. 22.

23.

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