It’s our first Yoga episode! And we couldn’t be happier to have yoga entrepreneurs and brothers Christopher and John Yax on the show. They are the founders and owners of Hot House Yoga, a studio based in Virginia, USA. Christopher and John chat to us about keeping a consistent teaching style across all their studios, how to increase the value of your yoga offering and how to create a compelling frontend offer that sells.
They also host the excellent Yoga Entrepreneur Secrets Podcast which you can listen to here
Transcript
Chris: I don’t think you can extract that out of the experience especially in a service industry because you have people and people bring their humanness to it. And the way we approach it as far as the variability is we have structures, we have principles in place around music, around lighting, around heat. We are very specific about the theme of the class is everything.
Kevin: How’s it going everyone! Welcome to the Fitness Founders podcast. I’m Kevin Mannion, VP Marketing here at Glofox. This week we talk to John and Chris Yax of Hot House Yoga. A highly successful family owned business in Norfolk, Virginia. We talk about creating a consistent member experience, keeping your prices high, keeping your customers happy. They’ve got to over a million dollars a year in revenue from their studio. They’ve got a lot to say so let’s get started.
Chris and John Yax welcome to the show.
Chris: We appreciate you having us. Thank you so much.
John: Yeah, thanks for having us, Kevin.
Kevin: Thank you for being here and thank you both for coming on. I think it’s definitely going to be a very interesting conversation. So maybe guys let’s start off by just telling me a little bit about Hot House Yoga and when you got started and how far you’ve come since you got started?
Chris: Yes, so we opened Hot House Yoga in 2005, so about a year after we went to our first teacher’s training. Let’s talk that first, John and I we had one other teacher but we were doing everything and I think that’s the norm for most yoga studio owners in the beginning. We were at the front desk, we put on the teacher hat immediately, we go and put the front desk hat back on immediately after class, start talking to people and sell them packages. We go right into marketer and advertiser mode when we have a little time to breathe. We go into janitor mode when we need to clean the bathrooms and fold the laundry and do all that stuff. So we were basically all in all day every day for the first year and a half before we brought on our first front desk person.
And then by 2007 we opened up our second studio in Norfolk, Virginia. I think we actually expanded the Virginia beach studio, our first flagship location in 2009. We opened our third location in 20012 and our fourth in 2015. When we started out it wasn’t just John and I as far as the partnership was concern. We also had our older brother Jimmy involved; he was kind of like a brother. He was a friend of the family forever. He was involved too, so there are four partners. It was kind of like a shoe that stopped fitting as far as the partnership was concerned and so we broke up the partnership in January 1, 2017. We separated the studios. My brother Jimmy and his wife owned the two outright in Northern Virginia, and John and I owned the two here, and also our it’s kind of like the sister company. It’s called the Yax Yoga Concepts. It is basically the personal development side of what we do which is teacher trainings, retreats, workshops. We are actually now transitioning to help other Yoga studios repeat the success that we’ve had.
Kevin: The main topic I would like to cover today is something we spoke about last week which was around creating this consistency around the product that you’re offering. You guys have obviously built a yoga studio of that scale and pretty successful business. Do you want to touch on some of the things that you’ve done in order to have that consistent classes and offering across all your studios?
Chris: Yeah absolutely. It is funny because I joke around it like when we started the studio it wasn’t for financial reasons. It was for passion. And that is exactly why you said like most people get involved but that’s the very thing that keeps them from being successful in it. Not that it’s their passion that’s keeping them but it is their lack of understanding of how to run a business. I would say over the 15 years we’ve been in business we built over a million dollar, at one point it was over 3 million dollars a year that we are in gross revenue between the four studios. Since we separated we’re still at like $1.25 million a year for the two studios that we own and the Yax Yoga Concepts. And so that’s nothing to bat an eye at and I would say if you said what’s the one thing that has been the real secret sauce to your success is consistency. It is consistency in we’re in a service industry so it’s the experience that people are getting in the yoga room so I could jump into that but it doesn’t end there. It really starts when people walk in the door. We talk about it when we have meetings like this and our front desk you are teaching yoga as much as the person in that room saying up dog and down dog. The way you talk to someone, the way you present yourself, that greeting and shaking their hands and saying hello, and treating them like a human being and asking what they are here for and how we can help, and truly being of service in the front of the house is so so important and systematizing. So as John and I removed ourselves from having to be at the front desk and teaching all the classes making sure that the people that were taking our place understood what it was that their job actually is to do. If I would boil it down even more it would actually be when someone walks into our studio to take a class regardless of the teacher they are going to get consistent experience which is so so important for their development and the success of the studio.
Kevin: How hard is it in practicalities because I’m sure lots of businesses end up being dependent on one or two or three trainers who are doing their own thing? How do you kind of create that control and that experience?
John: So we kind of stumbled into it Kevin when we first started because of our martial arts background, Chris and I, we knew that consistency work and in martial arts you practice a technique and then you spar. So if you are not consistent with the technique you get punched in the face. You get real feedback real fast. So we understood how consistency is so important as far as development goes. And so when we got to a point where we needed help, we needed other teachers to come in, we were sending people back to the teacher training that we did, and then when they came back we spent two to three months training those people to teach just like we taught. That got old real fast so we realized this needs to be faster. We need to be more proficient around this so that’s when we started our own teacher training in 2008. And that was one of the keys, Kevin, because when we started our own teacher training we could teach our teachers exactly what we taught and how we taught, and the methodology that we use, and the consistency, and the therapeutic vision. All the pieces that need to be understood as teachers that we spent months and months retraining this people in we could do it right away. We develop our own teachers they came out. We pick the cream of the crop out of those trainings and we knew that it was consistent. The other piece to that is that we would coach them and eventually we hired coaches to come in and take their classes and help develop them as they are still teaching so that really created that level of consistency.
And the other thing was we got to a point where we said, okay these are the two styles. There is actually one methodology that we use but we do that methodology expressed through just two styles in our studios and they work like stepping stones as an approach for students coming in. They start with the easier style and then they advance in that class and eventually take the other class which is a more challenging style. The first class is completely consistent. It is the same every time. And the second class has the ability to be unique as the teacher wants to develop it but it still follows that methodology. So that key is that consistency is born from us doing our own teacher trainings and continually coaching and helping our teachers become better teachers.
Kevin: Yeah, that makes a lot of sense. One thought that occurred to me is how do you get the balance right between that and having people bring some new ideas into the business or does that happen?
Chris: Yeah, it does happen. I mean, it is interesting when you look at it and take human psychology and what the needs that we all have like consistency is one of the most important things and we know it to be true; like if you go to a restaurant, you go to that restaurant because you like this specific meal. And when you go there you always get that meal. And if that meal were to change and depending like if there’s a different server that you had all of a sudden you are getting a different experience, or a different chef you are getting different experience, you are not going back there, right? And so what we know and especially if you then take that into account with the amount of new students coming in to your studios the rates are so high. It is between 70% and 80% of the people you have every year are new people who have never experienced what you have, so we really hold strong with consistency.
Now, the variability and the growth and evolution, like leaning to the question that you ask, I don’t think you can extract that out of the experience especially in the service industry because you have people and people bring their humanness to it. And the way we approach it as far as the variability is we have structures, we have principles in place around music, around lighting, around heat. We are very specific about the theme of the class is everything. And I feel like in this day and age with yoga it has gotten very fitness oriented. And it slightly show in a certain way but sometimes in a lot of areas what happens is the deeper principles, the deeper I call it spirituality has been stripped out of it. And so what’s really important for us is for the teacher to know that the creativity that they have and what they want to talk about, what we call the theme of the class which is this larger message that we can all universalized that all human beings deal with, and the solution and the problem that’s presented within the class by the teachers. So there is what’s baked into this like at first it was kind of a tough balance to strike was we want to be consistent because we know that’s what people are looking for but we also need that variability. And what we found is we’re getting the variability not in the sequence changing all the time that is in the flow class where they do have the liberty of changing the sequence and adding different poses as long as it follows the methodology. But there is this whole other level of the atmosphere that they are creating, that they are in control over to create a feeling for the students that is what… like the nature of it is that one teacher is going to present that slightly different than another teacher and in that is the variability that people actually fall in love with.
Kevin: Got it. And tell me this, it sounds like within the four walls you got things pretty nailed down. How do you extend that experience beyond the walls and how you deal with people and how you maintain this long term members?
Chris: Yeah, it honestly it goes to the next two needs which is significance. People want to know that they exist and that they mean something and then just connection, reaching out and doing simple things that make them. I mean, it is as simple as like know their name when they come in. Have a conversation. Know what they are going through in their life and just extend a hand and ask them like simple questions about, “Hey, how it is going?” But not in a superficial I’ve been ask to ask you this way, but actually like care. And I think there is a cultural thing that has to happen from the top down in my opinion. If it is lost, and this is how John and I feel about it, it is our fault. If there is something that’s going wrong in the studio I am 100% to blame for it. And because of that it also gives me the power to know that, oh I can make the change and if it is I’ll own it and say like, “Listen, I’m sorry, I’m human, we made a mistake. It wasn’t the right call. Let us correct it.” And if anyone needs to say anything let’s have a conversation about it. What is just so interesting is that we are teaching yoga and that’s what it’s all about. It is really about relationship. You know, first and foremost the relationship with yourself and then that relationship extends out to every other relationship. It is funny because we are like very business like make sure the structure is right, the consistency and the you have the front end, the front of the house, the back of the house, right? But within all of that is baked the principles of yoga which is connect, be real, give love, be compassionate, know you boundaries, hold the boundaries, have the policies in place that help you create better communication with your people.
John: I’ll just add to that for a moment. The two most powerful personal development tools that we’ve come across, Kevin, first yoga obviously, right? Because I’ll be real clear it is yoga practice obviously when you go on your mat and you do the poses. But that’s just the catalyst to get the mind to begin to settle, and then to practice meditation, to sit on a meditation cushion daily and do that work. And then the second would be entrepreneurship. When you put yourself out there you take all your saving and throw it into a vision that you have that’s going to have an effect. That’s literally going to change the world. Entrepreneurs are the leaders that change the world, that truly change the world. They are the ones that make the difference. And within that in order to be a successful entrepreneur it requires us to do the personal work. It requires us to expand out of our comfort zone and come somebody that we aren’t yet in order to succeed, you know. Does that make sense?
Kevin: Does 100%. And I just have one last question before we move on and that’s just back to the basics of saying hello to the people at the door, caring about the people coming through, is that something you just need to make good hiring decisions about, or do you think people can learn and be trained to do that?
Chris: Honestly, it is good hiring decisions. You can have systems and processes in place as far as hiring goes but the person got to match. They got to match the role that they are in. If you have someone who’s like socially uncomfortable and they are at the front desk meeting new people it is probably not going to work out well for them. I am not going to try to teach a fish how to climb a tree. But if there is a monkey who just needs to know how to climb better we can help that. But if the person is not just right they are not right. I think it mostly comes down to hiring the right people.
John: One of the first front desk people we hired, Chris and I realize we needed, this is way way way back. One of the first people, and we didn’t know how to hire anybody. Somebody walked in and say, “Hey, I’m looking for a job.” We’re like, “Cool. You’re hired.” Probably a week later we come in to the studio, Chris and I walk into the studio and she’s supposed to be working behind the front desk, she’s nowhere to be seen. We literally could have gone around and just taking the whole cash drawer and run. And so we look all around the studio and she’s nowhere to be found and we go to the back of the studio to the back door, and she’s out there smoking cigarette. We’re like, alright this is not good. So couple days later in another incident we ended up letting her go, we got to figure this hiring thing out better. And the last thing she said was, “Does this mean I’m not going to come to my shift tomorrow?” You know what, yes, you are done. It’s one of those biggest lessons is, hire slow and fire fast.
Kevin: So, I think the second topic guys we want to talk about today was around pricing and value and it’s something you guys are pretty passionate about. John maybe start by telling me how you address this at Hot House Yoga?
John: Yeah, I think our first mistake was that we thought that yoga should be for everybody and so when we’re messaging, we’re like, “Hey everyone, you should do yoga.” The second mistake was what you describe which was we wouldn’t put our prices high enough. And specifically like the front end introductory offer. What’s really interesting is that when you look around at the yoga community almost everyone does what’s called the low barrier to entry offer. Which means and in for us when we first started was like, everyone who comes in gets a free class. Well free literally has zero value. And so it doesn’t compel people to stay. It doesn’t compel people to perceive what they’re getting and the value of it. They don’t increase that perceive value at all and so what’s like pervasive in the yoga industry right now is low barrier to entry offers meaning someone can come in and do 30 days of yoga for $30, or $10 for two weeks. And what ends up happening is there is this misperception of price and value. And the fact that money actually follows the value, so the answer for us is, how do you increase the value of what you’re offering and it is related to price but it’s also related to what actually adds value; and there are three things that add value. One is story behind your service or product. So I can tell you, one of our mentors, this guy Stephen Larson. He had this story that he tells about he has an American flag that’s hanging up in his office and if you ask him like, “Hey, how much is that American flag?” He was like, “Oh, you know, you can get it online for ten bucks, twenty bucks.” “Okay.” But then he tells this story about this senator who had it hung at the white house specifically for him for seven straight days and that the service man that took it down folded it specifically for him and then was delivered to his door. And all the sudden the story that’s wrapped around that experience increases, so now if you ask him like, “Hey, how much is that American flag cost?” The value of it is through the roof because the story behind it has increased the value. And so that’s one way. You increase value through story. You also increase value because like if someone comes in to practice yoga. What we’re doing is resolving a problem for them and what happens when you solve one problem is that you make new problems. So if I come in to practice yoga, oh that’s good because I have back pain and I want to heal my back pain. So I’ll come in to yoga and in my mind, my back pain is already gone even before I’ve even taken a class. But the second problem that comes up is, “Wait a second, I need a yoga mat, and I need some water, and I’m going to sweat a lot and so I’m going to need some clothes. They are going to help me.” So all a sudden for us it’s like what are those follow up problems when they come in to a class that we can help solve and then either embed it into the package that they’re going to buy and doing so increase the price because we’re increasing the value of it, or we can then, so for us we have an online funnel that we do our introductory. And then there’s an option for what we call an order bump to get unlimited mat rentals because we know once they made the commitment to come in and buy that intro they’re going to need mats. And so we’re going to solve that problem immediately and they’re going to pay a discounted rate depending on how often they practice. And so that is just another way of adding value. What happens in the experience of studios is everyone is racing to the bottom. They are racing to the very lowest price and so if like this so and so studio down the road is having a thirty for thirty. I’m going to do it twenty for thirty. And then someone else is going to open up and they’re like I’m going to go ten for thirty, and everyone is literally putting themselves out of business by not charging what their worth and not understanding that money follows the value and if we can present more value for people we can actually charge more. And here’s the craziest thing is that people because they perceive it is higher value, they are more committed. They pay more attention. You know, with anything you bought if it is cheap, you don’t really care what happens to it. The moment it’s expensive, you are taking such good care of it that you would never let anything happen to it. And it’s the same thing in the service industry where we’re helping people get healthier and happier.
Kevin: And how do you get an intro offer rise because I think we all understand the idea of long term having a high price relates to high value and outcomes. How do you get the balance rise in that intro offer in terms of removing the barrier versus keeping the perception of value?
John: I mean this all depends Kevin whether the studio owner what they want to offer because there is a company called Yoga For The People and they have a studio in New York and I think they are in some years now, but they opened up in L.A, they’re all donation, total donation. And they are successful enough which you ask donation classes to be able to open up two studios. Now notice like they’re in New York, crazy demographics, high density, and in L.A same thing. They are not opening up in the middle of West Virginia somewhere, but somebody can. If somebody has support in the other side, they can offer a studio and do very low prices or free or donation, however they want to do it. So we’re not saying like people shouldn’t do that. They can. But what we’re saying is that if you are trying to have a successful business without having a corporate job, a nine to five, something on the side, then you need to understand business and you need to run it like a business. Now, one of the keys to having this shift or finding the balance of what is the right pricing to offer is creating a compelling offer in the front end. Meaning you put together because what people really want is they want to be out of pain. We have to understand what are the pain points of the people that are coming in and actually wanting to practice with us? It could be physical pain, it could be stress. But we want to create a package or front end offer that’s going to address that pain and then like Chris said also address the other problems that are going to come up as they move through it and start to discover themselves in this practice. Meaning coming in and having a certain amount of classes, maybe they have a more personalize smaller group class that all this new people come to, and then you have a meal plan on top of it because of course when they come in and start feeling better they going to want to know what do yoga people eat, how do I eat and feel better. Having a meditation component to it and so the front end offer becomes an actual offer and not just hey come and practice at my studio for a month for $20.
Kevin: Yeah, yeah.
John: Right? You charge more because there’s tons of value with it. You’re actually making a difference. You’re taking amount of pain, you’re transforming their lives, and you’re charging whatever your demographic can handle it but you could literally charge up worth of $300 or $400 for that package. Now imagine this, Kevin, somebody come in awe, it paid $400 for four weeks of yoga. They went through this whole program that you put on for them. You change their life, they then look at you’re pricing option and if you’re unlimited is $150 or $100 they are not going to bat an eye. They just paid $300-$400 to do this four week program and now they’re looking at an unlimited with you because you already indoctrinated them into your practice. They already understand what you’re doing. They look at that like just a deal. “Oh, you mean I can do unlimited for you know for $150. I’m all in.” That’s one of the keys, is crazy amount of value on the front end and then you’re selling them package and the back end is simple.
Chris: The only caveat is you got to deliver. Whatever you’re saying you’re doing, and all the value that you’re saying you’re going to present, if it doesn’t match what they’ve actually paid then it’s not going to work. The last thing is you just got to test because different markets will hold different value and different price. You don’t know until you try it, but I would say you know push the limits, see what happens and then make adjustments as you go.
Kevin: Yeah, I was going to say there’s probably two elements you have mention to it for any business owner. The first is to figure out how to package these things up and the second is to be able to sell them face to face per costumer. Did you guys kind of learn this on the job or how did you get to where you were?
Chris: Yeah, this is on the job training. I mean I did had a degree in international business and so I had schooling behind it but quite honestly and nothing I learned in that is relevant to what I’m doing right now. Even on the business level, well I guess I got like broader perspective of what’s out there as far as what value of my schooling was concerned. But honestly we’ve been in the service industry, John and I and basically the whole family when were in high school and through college we were waiting tables, and so you got to know people. You got to understand how just offering the upsell of like, “Hey, would you like the higher level liquor? Would you like the appetizer? Can I get you a dessert? Like little things like that and then understanding human behaviour. And we didn’t need to go through any formal training but there it was this years and years of being in the service industry and dealing with people and understanding what they’re looking for. That’s really what you’re matching is like just you got to know what is it that they’re looking for and even before that I would say Kevin is you got to know who you want to serve. And that’s when I started like most yoga studios like, “Man, you know we want to serve everybody.” “Well, you’re not going to speak to anybody if you want to serve everybody.” You may able to fulfil and solve different problems like, stress relief or back pain or just alternative fitness. But in the messaging, you got to be clear about who you’re talking to, so that those people will hear it and then take action on it.
Kevin: Yeah. Would it be rise, would you agree that if somebody is maybe reluctant to become a salesperson to ask for a decent price for their classes and their memberships that maybe as starting point is really getting a good understanding and believe in themselves around the problem they are solving and just expressing that.
John: 100% Kevin. That was goes back to I was saying entrepreneurship is one of most powerful personal development tools ever. Again, that what’s we end up bumping up against. When we started on this journey, we thought sales was a nasty word. It is like I don’t want to try sell people this and this but the reality of it is I can’t change somebody’s life unless they’re willing to commit to me. I can’t make a difference in somebody’s life unless they’re willing to commit to our process and so knowing that the process that we teach works, I have a hundred percent confidence in its ability to make a dramatic difference in people’s lives. So Chris and I have gotten to this point that we’re not scared to sell. I’m all about telling somebody that I can make a difference in your life. I can get you out of pain. I can do what you want, what you need in your life if you’re willing to commit to me and this is what it means to commit. It has worked in my life for over and over again. One of our teachers said the more people pay, the more they pay attention. And what I’ve noticed in my own life and Chris and I’ve, you know in the last five years, I’ve spent so much time and money on coaching and working with higher end coaches, and business coaches, and all personal development coach, people that can really like dive in to where your blockages are, what you are bumping up against and money issues and sales was a big one for us. In order to break through that we just have to say, “Okay I got to commit, I got to expand past to I think I am and be able to make this work because I want to help people and change their lives. And at the same time, I want to change my life and my wife’s life, my kids life, my brother’s life, you know.” There’s people that are riding on this, so we also have a big enough why to drive us.
Kevin: Yeah, make sense. Okay we’re getting close to the end. I wanted to finish with our standard question which is, tell me about one of the biggest mistakes that you guys have made so far in your business and what you learn from it?
Chris: I’m going to go way back. I’ve mentioned before when I was talking about when we opened up Hot House, we had three teachers, and one of the biggest mistakes we made in the beginning was we didn’t have that consistency as a culture placed in the system that yet. And so the other teacher, the one that was not John and myself, she would basically any class it was a free for all. You don’t know what you’re going to get in a class. And it’s funny because certain people didn’t like it, but a lot of people loved it because they wanted to be entertained. And we’re like we’re not about entertaining people, we wanted actually help better your life and so if you’re looking for entertainment, go somewhere else. But in the beginning, what we didn’t do was we didn’t have a structure. We didn’t hold to it and the relationship with her ended up breaking down and we had to let her go. And what we found was that there is a good portion of our students who left with her. And so the mistake was not holding a structure of what we knew to be true. I’m not saying it is the right and the absolute truth but just for us. So what was such the big lesson was, oh for the success of this studio, long term, we cannot have it be a teacher based studio where teachers can do anything they want, anytime they want and it is they are running the show. It has to be class based studio where students know what they’re getting. We have awesome teachers, they’re amazing. They get to have their own creativity, but in the ways that we deem fit for the culture that we created.
Kevin: Okay, yeah that’s the way to answer. Chris and John, before we say goodbye, maybe tell people where they can find you guys and what’s next for Hot House Yoga.
Chris: You can reach out and find us… if you’re in the area because Hot House Yoga is local in the Virginia Beach, Virginia, Norfolk. You can check us out at hothouseyogi.com. If you want more of the information that we have, we have a podcast called Yoga Entrepreneur Secrets. So it is new in Denver that we’re doing to help yoga studios and yoga entrepreneurs understand the business end of it, the marketing end of their business so that they can drive and help more people help themselves. And we have a Facebook group called Yoga Entrepreneur Secrets as well that if you’d like join, we do live trainings on all the stuff like we’re documenting what we’re doing right now. And one of the things that we’re super excited about is we’re going to be pushing the limits with our introductory offer or Hot House and everything that we just talked about, we been implementing but we’re like, “You know what let’s see what really works and let’s add as much value as we can and see how much change we can make in people’s lives on the front end and to see how much revenue we can generate and let’s see how it goes. It may fail but we’re pretty sure it’s going to be a success.
Kevin: Okay well the best of luck. Alright Chris and John, thank you very much for coming on the show.
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