With rising costs and changing priorities, consumers are being more selective about where they spend and what they keep. At the same time, demand for flexibility, value, and convenience has never been higher.
To stay competitive, brands need to understand what drives service-based membership decisions: Why do people join? What makes them stay? And what pushes them to cancel or come back?
To better understand this, SMG surveyed consumers around membership usage, retention, and churn. In this blog post, you’ll find insights on what members value most, why low engagement can signal risk, and how to design smarter programs that build lasting loyalty—even in uncertain times.
Note: For this study, we focused specifically on service-based memberships that involve some level of human interaction. This includes gyms, personal care services, movie theaters, activity-based entertainment, and car washes. Product-based subscriptions and other non-service models were excluded to keep the insights relevant to businesses where experience and engagement play a central role.
Keep them coming back: Why frequent usage fuels loyalty
When it comes to service-based memberships, frequency matters more than you might think. In fact, “how often I use it” is the most important factor consumers consider when deciding whether to join or stick with a membership.
People who use their memberships weekly are not only more satisfied with the value they’re getting—they’re also more likely to renew. On the flip side, infrequent use is one of the top reasons people cancel. If a membership isn’t part of a regular routine, it’s at risk.
To support retention, brands need to make regular usage easy and rewarding. Think habit-forming campaigns, reminders, and benefits that evolve to keep members engaged.
Deliver great service—not just access
The best memberships give people access and deliver great service. For most consumers, quality of service, equipment, availability, and variety are some of the top reasons they join and keep coming back.
Positive service experiences are key to maintaining strong perceptions of value. When members feel they’re getting quality and variety for the price they’re paying, they’re much more likely to stay.
From staff interactions to seamless check-ins to offering new or rotating services, these details help justify the price and reinforce a sense of premium value.
Price pressures are real, but so are opportunities
Economic pressure is pushing people to reevaluate their expenses. In fact, 62% of those surveyed say they’ve reduced non-essential spending primarily because of cost-of-living increases and general economic uncertainty. Budget-conscious members cite cutting back on spending, price hikes, and low usage as top reasons for cancelling.
Memberships aren’t immune. Current members unlikely to renew cite both cutting back on spending and price increases 31% of the time. That’s why clearly demonstrating value is more important than ever. Even a low monthly fee can feel unnecessary if the member isn’t regularly engaging.
To help avoid churn, brands should offer tools that help members track and reflect on their activity. Showing how often a membership is used or how much someone has saved reinforces value and helps justify the expense. Pair that with flexible pricing and evolving perks, and you’ll be better positioned to keep members engaged and demonstrate value, especially for services that might feel non-essential.
Turn insight into action: How to support satisfaction and retention
Looking to help more members stay active and satisfied? Start by rewarding regular usage. Streak incentives or loyalty milestones can encourage members to build consistent habits and reinforce the value of their membership over time.
For those who are less active, a well-timed nudge can make a difference. Consider re-engaging lapsed users with personalized reminders or limited-time offers that prompt them to return and reconnect with your services.
Another effective strategy is sending monthly summaries that show members how much they’ve saved or how often they’ve used their benefits. These simple updates help reinforce perceived value and make it easier for members to justify continued participation.
Finally, keep things fresh by rotating member-only perks or seasonal benefits. A service sampler or special access to new offerings can help renew excitement and give members something to look forward to.
It’s more than what you’re offering. It’s about helping members feel connected, engaged, and confident that their membership is worth it.
Membership cancellation is common
Service-based memberships face regular turnover. In fact, 46% of consumers have cancelled at least one membership in the past year. Even so, most who cancel continue to hold others. Gym and personal care memberships are the most likely to be dropped, but this doesn’t necessarily signal a rejection of the model. It’s more a sign that members are re-evaluating what’s worth keeping.
Nearly three in four consumers hold more than one type of service membership, and almost two in three have cancelled more than one. It’s clear that today’s members are comfortable with trying, dropping, and switching between services depending on what fits their needs and budget at the moment.
Former members are willing to return if the offer is right
The good news? Cancellation doesn’t always mean goodbye. More than half of those who cancel a membership say they’re open to joining another service in the future, especially if the value is clear. Convenience, transparency, and the chance to try something new are key motivators for returning.
To win them back, smart reactivation tactics matter. Flexible plans, sign-up discounts, and standout customer service make the decision easier (especially since 43% of consumers are willing to spend more for added convenience, while 42% say they’d pay extra for a warm, friendly experience). Clear expectations and predictability also help—when consumers know what they’re getting each month, they’re less likely to feel overwhelmed by options or regret a recurring expense.
How to reduce churn and re-engage former members
Small adjustments can make a big impact. Consider offering a “try before you commit” option or a limited-time discount to make returning feel low-risk. Advertise the flexible aspects of your membership, like pausing or downgrading, so members don’t feel forced to cancel completely.
If someone’s been with you for a while, reward that loyalty. Bundled-value offers or long-term member perks can reinforce their decision to stick around. By focusing on flexibility and transparency, you’ll create a membership model that meets evolving needs and brings members back when the time is right.
Make membership feel worth it
Service-based memberships must deliver real, ongoing value that feels worth the investment. While cancellations are common, they’re not always permanent—and they’re often preventable. By understanding what drives members to stay, cancel, or rejoin, brands can build stronger connections and longer-lasting relationships.
To do that, you need more than assumptions or surface-level feedback. Brands must go beyond the “what” and uncover the “why” behind member behavior. What keeps people coming back? Why are they lapsing? What would make them rejoin? A data-driven platform helps answer these questions and shine a light on what’s working, where members are disengaging, and where to focus next.
That’s where SMG comes in. We help brands that offer service-based memberships turn member feedback into clear, actionable strategies that improve satisfaction and drive stronger outcomes. From identifying usage patterns to targeting at-risk members and optimizing offers, our platform makes it easier to track what matters most and take action that builds retention and revenue.
When members clearly see the value, they’re more likely to stay. Let us help you design a membership experience that earns loyalty every month.
