ClassPass is a startup that offers a monthly subscription service to fitness classes in more than 30 cities around the world. The company has struggled to find the “right price” for its services. ClassPass was offering a $100 per month subscription for unlimited fitness classes. This pricing, ClassPass attracted workout warriors – who got the best deal from this pricing, but their usage rate hurt ClassPass’s margins. In April 2016, ClassPass raised the price for its unlimited product to $180 – and not surprisingly lost customers.
Learn more about ClassPass’s pricing issues by first reading this article at TechCrunch “ClassPass sacrifices 10% of customers in pursuit of healthier margins,” (September 27, 2016). For a more recent update on its pricing see “ClassPass kills off the unlimited pricing model that made it popular,” (Fast Company, November 2, 2016).
After reading chapters 17 and 18 and the articles above, what are some of the problems inherent in ClassPass’s pricing strategy? What would you recommend to ClassPass for its pricing strategy moving forward?