Not everyone’s fitness regime is created equal. So ClassPass is introducing a new tiered pricing model in some cities.
On Wednesday, the company said it was hiking its Unlimited option in Boston to $180 per month. That’s the company’s standard offering which grants members access to boutique fitness studios.
When ClassPass launched three years ago, that same option cost just $99 a month. But it’s been gradually increasing. In October, it increased prices in Boston to $119.
ClassPass is also introducing two new levels: Five classes for $65 (which will be available in all 29 of its U.S. markets) or a 10-class option for $120 (available in Boston).
“We think we’re going to better address the needs of different kinds of people,” said Fritz Lanman, executive chairman at ClassPass.
The company recently rolled out similar tiered offerings in Atlanta and Toronto, along with accompanying price increases.
The prices for unlimited packages varies in each city, but the increase is substantial — especially for new members. The hikes haven’t been without backlash, but ClassPass said it’s seen “very little” churn as a result of the changes.
ClassPass’ move comes as the tide has started to turn in Silicon Valley. Investors are increasingly focused on profits rather than the “growth at all costs” it had encouraged previously.
Payal Kadakia, CEO and cofounder of ClassPass, told CNNMoney that the price changes are a reflection of just how well ClassPass is working.
“It’s good that we’re inspiring people to work out more, but the reality of the economics is, if you’re working out double, you should probably be paying something more for that,” said Kadakia, adding that usage of its Unlimited option has indeed doubled in some markets.
“With that being said, we wanted to remain accessible to all different consumers,” she said. ClassPass says members have booked 17 million classes through its platform.
For now, it is evaluating each market individually and making pricing adjustments accordingly.
ClassPass — which has raised $84 million — said its contracts with studios vary and wouldn’t comment on whether it will pay individual studios more as a result of price hikes. It said that it has a high studio retention rate — 96% studios stay with ClassPass after signing up.
It is also now letting members buy studio classes on ClassPass’ website when they hit their studio or package limit. Members can purchase these classes at a discounted, determined by studios.
“They still have spots that are going unfilled,” added Lanman. “We’re helping them make more money.”
