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Yifan Zhang and Geoff Oberhofer, the duo behind Gym-Pact, the behavioral economics gym plan in Boston we posted about earlier this year, have taken a 10-pack of questions about fitness, business, and human behavior. While Gym-Pact has arrangements with Boston-area gyms, the company has just released an iPhone app at www.pactapp.com to help people keep commitments at gyms anywhere. Yifan and Geoff answered our questions over email. A transcript is below.





Nudge blog: How do you make money from your plan? Just like a regular gym, you seem to profit more when people miss their appointments. Is that the case?

Gym Pact: We actually get people to the gym on 90% of the days they commit! Gym-Pact’s model does not profit from people missing appointments. Rather, our main revenue comes from the service we provide to gyms (selling discounted memberships, referring people, etc).

NB: You don’t own a gym. Instead you partner with existing gyms. What kind of success have you had with these partnerships in Boston? Do your members visit more frequently? Are you tracking data, particularly on success and failure rates?

GP: Yes! We love data, and so far the data loves us back. We’ve held our 90% success rate for now over 5 months, and our members commit on average to 3.5 days per week!

NB: Have you experimented with the design of the penalty itself? Are certain size penalties delivered at certain times more effective than others?

GP: While we don’t want to change things up too much for our current members, who find our existing system very effective, we are launching an iPhone app. We’re accepting 100 beta testers currently at www.pactapp.com, and we will be trying a few motivational fee designs, including just tracking attendance without the fee. If you’re interested in giving this a shot, all you need is an iPhone and we can set you up at any gym in the country.

NB: How do you enforce the commitments people make?

GP: We have our patent-pending attendance system placed at partner gyms, where Gym-Pact members text us a constantly updating code when they check in and out of the gym. We (now have an) iPhone app to track attendance as well. Our members put up money to motivate their fitness commitments, and we enforce those commitments based on attendance.

NB: By putting the penalty for missing the gym in financial terms, does it actually boomerang and lead people to skip more often? In other words, do financial penalties crowd out personal norms?

GP: Not that we’ve seen so far. Regular exercise is something all of our members strive for, and they know it’s good for them! We just give them the extra kick to get to the gym with the regularity they’ve always wanted.

NB: What have you learned more generally about human behavior and fitness since you first conceived of this idea?

GP: When given the opportunity, people will cheat! We have to make sure that our Gym-Pact(SM) system is cheat-proof so that there are no excuses and no opportunities for members to cheat themselves of regular exercise, only results.

NB: Do you have any intentions to revise Gym Pact’s business model by incorporating more behavioral theory?

GP: We have a few ideas that we will be testing out with our iPhone app – more to come on this!

NB: If you owned your own gym and could design it from top to bottom drawing on behavioral economics, what sorts of features would you consider?

GP: We would definitely structure the membership fee to incentivize regular exercise. Regular attendance is not only good for members, it’s great for gyms because it’s the strongest signal that a member will continue being a member of the gym.

NB: How does your iPhone commitment app work?

GP: We use GPS technology and our database of gym locations in the U.S. to take attendance. Other than that, it is the same Gym-Pact(SM) program. For our beta testers, however, we will be adding a few more options so if you’re curious, feel free to try it out!

NB: Do you have any plans to incorporate social media in the device to enforce commitments through peer pressure?

GP: Yes! Sharing your successes and competing with friends is one of the strongest motivators, and we definitely will be incorporating these aspects to our app and regular Gym-Pact program.

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Yifan Zhang and Geoff Oberhofer, the duo behind Gym-Pact, the behavioral economics gym plan in Boston we posted about earlier this year, will answer your questions about their business.




Post your questions in the comments section or email them to nudgeblog@gmail.com by the end of the week (Friday, May 13). Zhang and Oberhofer will answer on May 18th, the day Gym-Pact releases a iPhone app that lets people make their commitments at any gym. Before you send a question, you might check out the FAQs on the Gym-Pact site.

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1) Banking interface inspired by behavioral economics.

2) Smart commentary from Modeled Behavior on the idea of giving people vouchers to fight obesity.

3) A “commitment app.” Promise to do X. Announcement about X sent to friends. App verifies promise. Announcement about doing X sent to friends.

4) Forbes columnist: Opower utility bill “one of the most important energy innovations of the last decade.”

5) IPA puts out new behavioral economics pamphlet with 9 case studies. (Non-members have to buy the pamphlet.)

6) What’s your appetite for risk?

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If you need an example of behavioral economics for one of your classes, you can never go wrong with the gym. Men’s Journal explains the standard gym business model:

Commercial health clubs need about 10 times as many members as their facilities can handle, so designing them for athletes, or even aspiring athletes, makes no sense. Fitness fanatics work out too much, making every potential new member think, Nah, this place looks too crowded for me. The winning marketing strategy, according to Recreation Management Magazine, a health club–industry trade rag, focuses strictly on luring in the “out-of-shape public,” meaning all of those people whose doctors have told them, “About 20 minutes three times a week,” who won’t come often if ever, and who definitely won’t join unless everything looks easy, available, and safe. The entire gym, from soup to nuts, has been designed around getting suckers to sign up, and then getting them mildly, vaguely exercised every once in a long while, and then getting them out the door.

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Assorted links

1) Nudging rules for charities.
2) Exercise meets commerce.
3) Just buy this one – a site that radically simplifies shopping (and requires a lot of trust in its consumer ratings). Hat tip: Rory Sutherland.
4) Washington State posts surgical infection rates at all state hospitals online. Hat tip: Maria Kovell.
5) Electronic prescriptions lead to higher non-adherence? Strange. Hat tip: Gilad Buchman.
6) A version of RECAP for bank loan fees in India. Hat tip: Mostly Economics.
7) What’s the secret to marketing the McRib? Artificial scarcity.

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Assorted links

1) 10 percent of AOL employees at the Dulles campus work at their desks standing up.

2) A smart behaviorally informed tax cut may not be such smart politics. Fewer than one in ten people know they got a tax cut last year.

3) Unhealthy food purchases are more likely to made with credit or debit cards.

4) Cornell gets $1 million to fund the Cornell Center for Behavioral Economics in Child Nutrition Programs from the U.S. Department of Agriculture.

5) A leading Indian telecom uses opt-out ebilling. Hat tip: Amol Agrawal.

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Floating around the net. How many of these people will use the stairmaster inside?

Addendum: Funnier still would be an escalator that never worked.


Assorted links

1) NudgerSize – the iPhone app that motivates you to exercise more. It costs $.99 to download.

2) Choice architecture to generate repeat customers using old lottery tickets. Hat tip: Jeff Maystruck.

3) 85 percent of shoppers pick a product because of its color. Hat tip: Melanie Cook.

4) The power of secret commitment strategies. Hat tip: K.O.

5) The Campaign Company defines a nudge as an intervention that offers a positive reward in conjunction with a passive decision making process.

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The Wall Street Journal reports on another study showing that reminding (some call it nagging) has its virtues – this time for exercising. As part of the study, one group of people received a weekly phone call from a human asking them how much exercise they’d gotten that week and congratulating them if they had met a personal goal. Another group got a similar call from an automated system. A third group got no call.

After 12 months, participants receiving calls from a live person were exercising, as a mean, about 178 minutes a week, above government recommendations for 150 minutes a week. That represented a 78% jump from about 100 minutes a week at the start of the study. Exercise levels for the group receiving computerized calls doubled to 157 minutes a week. A control group of participants, who received no phone calls, exercised 118 minutes a week, up 28% from the study’s start. “When you knew you were going to have to report back on what you had done, it motivated you,” says Ms. Lowe.


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