28 Terms Martial Arts School Owners Must Know

Are you a martial arts school owner, or perhaps you're thinking of owning one?

Whether you're contemplating starting, just starting, or a seasoned martial arts school owner, you've likely begun your journey with a passion to teach martial arts and inspire children to stay active and build self-confidence through the practice.

What you may not have realized is that operating a successful school requires more than just knowing how to teach martial arts; it also entails becoming a business owner and gaining business acumen. Sometimes, learning the business side of your martial arts school can be overwhelming and frustrating, especially if you're unsure whom to trust and what exactly they're discussing.

That's why we've compiled a list of 28 essential business terms that all martial arts schools should be familiar with if they want to grow into profitable and successful enterprises.

1 ROI

This is the first term listed because it's significant for all business owners to understand. ROI stands for Return on Investment, which measures the revenue generated from a particular investment.

While most businesses typically calculate ROI based on advertisements or marketing campaigns, if you spend $1,000 on an advertisement and generate $2,000 in sales (not profit), then you've essentially doubled your investment.

ROI can also apply to new product development or upgrades to your school's facilities. For instance, if you expand your school and add classroom space, enabling you to enroll 100 more students, that could also be considered an ROI.

It's important to note that ROI does not measure profit. You can have a negative ROI where you've spent more than you've earned back. However, a negative ROI may not necessarily be immediately bad, depending on your strategy and the lifetime value of a customer (something I'll cover later).

2 CRM Software

CRM stands for Customer Relationship Management Software. Many martial arts school owners underestimate the importance of a good CRM because they either don't know what it is or believe they don't need it.

If you've just opened your school or gym, it might seem a bit early to worry about having a CRM. However, once you start marketing your martial arts school to attract more students, having a good CRM becomes essential.

A good CRM will help you:

Capture and organize leads
Track leads, appointments, no-shows, and sales.
Provided automation to help you manage your follow-up with leads.
Provide you with reports on your ROI and advertising investments.

There are many CRMs all there each with its pros and cons. Monstro for example is technically a CRM that helps you simplify your marketing, capture more enrollments, and manage your members to increase retention.

If you're looking for an awesome CRM to help you manage and grow your school, book a free demo with us here.

3 Retention, Churn, or Attrition

Churn, also known as attrition, refers to the rate at which customers stop doing business with a company or organization over a certain period.

This is a crucial metric for all schools and studios because it measures how long members will stay with a school or studio—the longer, the better.

It's important to note that churn or attrition can be measured monthly or annually. Schools with high churn rates or attrition usually experience this due to poor program structure, bad customer experience, or ineffective customer acquisition.

The first two reasons are obvious, but the term 'bad acquisition' refers to how you acquire members, which can also influence their churn rate. For example, discounts or Facebook ads often result in a higher churn rate.

4 LTV

LTV stands for the lifetime value of a customer. This is important because customers should be measured by their lifetime value, especially with membership business models.

The lifetime value is the amount of money a customer will spend with you over their lifetime. For example: an average school or studio charging $160 with 12-month retention would mean the average value of a customer would be $1,920.

This is a very important metric for martial arts owners to know because it determines what you can afford to pay to acquire a new student. As mentioned above regarding ROI, most martial arts owners seek instant ROI, which is understandable but often harms their business.

Because martial arts classes are subscription-based, it's important to know, on average, how much a student would spend at your school in a lifetime. If that number is $3,000, then you should be willing to spend $150, $200, or even more to acquire a new student, even though you may incur a loss in the first month. However, over the lifetime of that student, you will recoup the investment.

5 Cost Per Acquisition

This is the cost to acquire a student, if you spend $100 on ads to acquire a custom it would mean that your CPA would be $100. It is ideal to keep track of how much it costs you to acquire a new student from all your marketing sources and channels as they will vary.

This will provide you with a good idea of where to invest more of your marketing dollars and give you the lowest possible CPA with the highest possible lead quality.

6 Revenue (Top Line)

Top-line revenue, also known as gross revenue, signifies the total income generated by your martial arts school from its primary business activities before subtracting any expenses such as operating costs, taxes, interest, or depreciation.

This metric serves as the starting point on a company's income statement and reflects the overall sales or revenue derived from selling its products or services.

Analyzing top-line revenue is essential for evaluating your martial arts school's financial performance and growth monthly and annually.

7 Bottom Line

The bottom line refers to the minimum amount your business needs to generate before going into the red, meaning you're losing money. For example: if your monthly expenses are $5,000, then you will need to earn at least $5,000 just to break even.

The bottom line is a critical metric for assessing the financial performance of your martial arts school. A strong bottom line indicates that you're generating healthy profits, which can be reinvested into your school for future growth.

On the other hand, a weak or negative bottom line may signal financial troubles and the need for corrective action.

8 Overhead Cost

Overhead costs refer to the ongoing expenses your martial arts school incurs as part of its regular operations that are not directly attributable to creating classes or programs. These costs are essential for your martial arts school to remain operational.

Examples of overhead costs include rent for your school, utilities such as electricity and water, salaries for administrative staff and coaches, insurance premiums, and expenses related to maintaining equipment or facilities.

Essentially, any cost that doesn't directly contribute to operating your business and teaching your classes is considered overhead. Understanding overhead costs is crucial for martial arts schools because they need to manage these expenses effectively to ensure profitability.

9. Cost Per Lead

Cost per lead is a term you'll often hear, especially if you're running marketing campaigns such as Facebook ads. Cost per lead is exactly what it sounds like: it's the amount it costs you to acquire a lead from your marketing activities.

This metric is important to track, but don't let it mislead you. Here's why: many marketing agencies will tout a low cost per lead, for example, saying, 'I can get you leads at $5 each.'

Sounds great, right? Maybe...

But leads aren't enrollments. When you hear $5 per lead, you might think, 'If I can get 100 leads for only $500 and close 50 of them, I'm rolling in cash.'

The reality is that lead cost is almost irrelevant because of lead quality. If you pay $5 per lead but most of them don't respond or aren't interested in your martial arts school, and you only convert 1 out of 100 leads, then your cost per acquisition is $500.

On the other hand, if you pay $50 per lead but enroll a new student out of only 4 leads, your cost per acquisition is only $200. Which would you rather have?

10. KPI (Key Performance Indicator)

This is another term you might come across that is quite important. KPI stands for Key Performance Indicator. It's a single value or a set of measurable values that demonstrate how effectively a company is achieving key business objectives.

Simply put, these are important data points that you, as the owner of a martial arts school, would decide to track to measure how well your school is performing in different areas of your business.

For example, I've already mentioned many commonly used KPIs such as CPA (Cost Per Acquisition) and CPL (Cost Per Lead). These metrics are used to measure how effective your marketing campaigns are and to identify areas for improvement.

KPIs are not limited to measuring marketing effectiveness; you can also set KPIs for measuring how well your students are progressing through class and how long each student takes to move up to the next rank.

However, generally speaking, KPIs are usually set for business objectives, which usually come down to improving acquisition, retention, revenue, operations, customer support, etc.

11 SEO (Search Engine Optimization)

SEO stands for Search Engine Optimization, which is a marketing strategy to actively influence your martial arts school's ranking at the top of search engines.

Because Google is the most popular search engine and accounts for more than 90% of all online search traffic, when people use the term SEO, they often refer to ranking at the top of Google.

SEO is a big topic in itself, so I won't go into detail here. If you're interested in learning how to optimize your SEO so your school will show up at the top of Google search results, I recommend checking out this article.

However, I will quickly talk about some of the most common terms you'll encounter while optimizing your Search Engine Ranking.

Backlinks: Links that direct to your site.
Domain or Page Authority: Refers to the authority score given by Google to a specific domain or page.
Anchor Text: The text to which a URL link is anchored.
On-Page Optimization: Refers to how well your website or page is optimized according to SEO best practices.
Internal Linking: How your internal website pages are interconnected. Does it affect SEO?
Page Load Speed: How quickly your website loads. 12 Local SEO

Another term you'll encounter is 'Local SEO'. You may be wondering if there is a difference between SEO and Local SEO.

Well, kind of...

Local SEO refers to optimizing for local search terms such as “restaurants near me” and “restaurants in New York”. While SEO refers to optimizing your results for both local and organic search results. If this sounds confusing to you, take a look at the image below:

Local results only appear on Google and maybe Bing. Bing, however, does not provide its local results but rather through a third-party website such as Yelp or Local Advisors. These "local" results are shown based on the user's location, and Google will display the nearest results closest to you on Google Maps.

Unlike organic SEO, which ranks your website, for local SEO, your Google Business Profile, or sometimes referred to as Google My Business, is the property that ranks.

Here are the top contributing factors for ranking locally on Google:

Google Business Profile optimization
Proximity
Number of Reviews
Website Optimization
Citation (links from other websites such as Yellow Pages that allow you to post your Business Name, Phone, and Address).
Content and Photos.
Backlinks

Again, SEO or Local SEO is a vast topic, too extensive to cover even a small portion of it here. If you're interested in learning how to optimize your school to rank at the top of Google, I highly recommend checking out this article here.

13 Facebook or Instagram Ads

Facebook ads and Instagram ads offer you the ability to pay for advertising on these platforms, unlike traditional paid advertisements such as radio, television, or newspapers.

These digital platforms, such as Facebook and Instagram ads, work on an auction system. While no one knows exactly how the Facebook and Instagram ads algorithm works, it is usually determined by the size of the audience you're targeting, who else is targeting this audience, and how much everyone is willing to pay to show their ads to this audience, as well as how engaged the audience is with your ads.

Unlike traditional ads, Facebook does not always show ads to the highest bidder, although it is a significant determining factor. It also considers whether people like and engage with your ads. The reason is Facebook's primary objective is to keep users engaged, so it's not in their best interest to show ads that are turn-offs or will drive users away.

Overall, Facebook and Instagram ads offer businesses an effective and cost-effective way to reach their target audience, drive website traffic, generate leads, increase sales, and build brand awareness.

However, it can be very difficult to achieve a good ROI from Facebook and Instagram ads unless you know what you're doing.

14 Facebook Pixel

A Facebook pixel is a piece of code provided by Facebook that businesses can place on their website to track users' interactions and behaviors for advertising and analytics purposes.

It allows businesses to measure the effectiveness of their Facebook advertising campaigns by understanding how users interact with their website after clicking on a Facebook ad.

You should install the Facebook pixel on your website whether or not you are running Facebook or Instagram ads. This is because the pixel will continuously collect data that it can use even if you're not running ads.

By installing the Facebook pixel even when you're not running ads, you can easily leverage the data when you do decide to run ads or a retargeting campaign.

15 Google Ads

Like Facebook and Instagram ads, Google also has its advertising platform that offers a wide variety of ways to target your audience. And just like Facebook, Google ads also work on an auction, although the rules differ a little bit.

Unlike Facebook or Instagram ads, Google also offers search-based ads where your ads are shown to users who match certain keywords that you bid on.

As a result, in general, Google ads will yield higher lead quality, although they will also be more expensive.

Here are the types of Google Ads you can run:

Local or Service Ads: Google Local Services Ads are a type of advertising format specifically designed for service-based businesses, such as plumbers, electricians, locksmiths, and HVAC technicians. These ads appear at the top of Google search results when users search for local services in their area, displaying important information like the business's name, phone number, ratings, and hours of operation.

Search or PPC (Pay Per Click) Ads: This allows advertisers to bid on keywords and display ads in Google's search results. Advertisers pay a fee each time their ad is clicked, with ad placement determined by bid amount and ad quality.

Display Ads: Google Display Ads are visual ads that appear on websites, apps, and videos across the Google Display Network, such as news sites or other sites that Google partners with.

YouTube Ads: YouTube ads are video advertisements that appear before, during, or after YouTube videos, as well as within search results and on the YouTube homepage.

17 Retargeting and Remarketing Campaigns

A retargeting or remarketing campaign is a form of digital advertising strategy that targets ads to users who have previously interacted with your website or digital content.

By tracking user behavior and creating targeted ads tailored to specific audience segments, retargeting campaigns aim to re-engage users and encourage them to take further action, such as submitting a form or purchasing a trial class.

Overall, we highly recommend leveraging retargeting and remarketing ads, as these are the low-hanging fruit that have already been to your website or seen your content.

The best part is you don't even need to spend a lot of money on these ads—maybe just a few dollars a day will do.

18 (CRO) Conversion Rate Optimization

CRO, or conversion rate optimization, refers to the practice of optimizing your website or landing pages to capture more leads and appointments.

Because the words on your page and how it is designed or structured can heavily affect the results you get from your ads or organic SEO traffic, it is ideal to spend time testing and optimizing the conversion rate of your assets.

For example, a landing page that converts at 10% versus a landing page that converts at 20% can make a huge difference in your ROI, and sometimes it can be as simple as changing a few words on your page.

This why it's important to understand the term CRO or conversation rate optimization as even for your website you'll need a little of CRO to be able to maximize the results that you get from Google and referral traffics.

19 A/B Testing

A/B testing, also known as split testing, is a big part of CRO. It is a method used to compare two or more versions of a webpage, email, advertisement, or other marketing asset to determine which one performs better in terms of achieving a specific goal.

The goal could be anything from increasing click-through rates, improving conversion rates, or maximizing revenue.

20 (CTA) Call to Action

Call to Action or CTA is a term you will often hear in marketing and one you should familiarize yourself with. The idea in marketing, whether it is sending someone to a landing page using Facebook ads or driving organic traffic to your website through SEO, is to give the user or potential customer a clear path forward with a call to action, letting users know exactly what they should do next. This can include but is not limited to:

Book a Trial Class
Add to Cart
Checkout
Book a Consultation
Call Us At
View Article Here

A call to action doesn't necessarily have to involve a transaction but rather provides a clear call to the next action you want the user to take.

21 (CTR) Click-Through Rate

CTR stands for Click-Through Rate. It is a metric used in online advertising and email marketing to measure the effectiveness of an advertisement or a link in generating clicks from its viewers or recipients.

CTR is calculated by dividing the number of clicks an ad or link receives by the number of times the ad or link was shown (impressions), and then multiplying the result by 100 to express it as a percentage.

22 Attribution (Advertising)

Attribution in advertising refers to the process of assigning credit to various marketing touchpoints for driving conversions or generating leads. In other words, it's about understanding which ads or marketing efforts are responsible for driving specific actions, such as a purchase, sign-up, or inquiry.

For example, if you're running Facebook ads and a lead comes in from your ads, it would be attributed to Facebook ads. The complication arises when you're running multiple channels and receiving organic leads.

Let's say you're running both Google ads and Facebook ads, and a lead first clicks on your Facebook ads but doesn't submit the form. Later, they go to Google and search for 'martial arts school near me,' finding your Google ads and deciding to submit a form to request more information. Which channel gets the credit for the lead?

This is the challenge with attribution in advertising. I'm not going to get into details on this as it's a billion-dollar question and you probably don't need to figure it out. Just know that attribution is crucial for marketers to accurately measure the effectiveness of their campaigns and allocate resources effectively.

Organic social, like any other organic traffic, refers to traffic coming from social media platforms such as Facebook, Instagram, etc., that is not generated through paid advertisements.

This traffic can result from posting content on these platforms or engaging with groups. While organic social can be an effective way to attract and generate more leads for your martial arts school, it also requires dedication and consistency.

Not only do you need to post content consistently, but your content must also be engaging, educational, inspirational, or entertaining. Simply posting content on organic social platforms won't be enough; you must post the right type of content. We've written a guide on how to leverage organic social using the flywheel effect to grow your martial arts school. I highly recommend that you check it out.

24 Landing Page

A landing page is a standalone web page created specifically for a marketing or advertising campaign. Unlike other pages on a website, which serve various purposes and are typically part of a broader navigation structure, a landing page is designed with a single focused objective – to convert visitors into leads or customers.

25 Customer Journey

The customer journey refers to the path or journey a customer experiences from becoming aware of your business and services until they cease being a customer or become a fan of your brand.

It involves carefully crafting and implementing processes to enhance the customer's experience with your school from end to end. For example, how a customer pays for your classes, what happens on the first day, during the first month, and ensuring their satisfaction and happiness.

Every touchpoint in their journey with your business counts, although it's unlikely you'll ever find a perfect solution. The goal is to improve the experience for the majority of your customers and ensure your ideal customer has a great experience from beginning to end.

26 Show and No-Show Rate

Show and show rate refer to the measurement of how many appointments show up to a trial class. Most owners believe everyone who books an appointment will show up, but that is just not true.

However, a percentage of them should show up. That said, the show-up rate or no-show rate will vary depending on how the appointment was acquired. For example, Facebook ads usually have a 30% show-up rate, while Google leads have an 80% show-up rate.

Another factor is whether the appointment has put some skin in the game already. A paid trial will always have a 100% show rate.

27 Google Business Profile

The Google Business Profile or Google My Business is the profile local businesses can set up on Google, which will show up for local search terms.

Everyone has seen it; this is where your Google Reviews will be and information about your business such as name, phone number, address, and hours can be found.

It is important to spend time optimizing your Google Business Profile as it will determine how well you rank on Google locally.

28 Google Analytics

Google Analytics is a web analytics service provided by Google that allows website owners to track and analyze various aspects of their website's performance and user behavior.

It offers a wide range of features and insights to help businesses understand how users interact with their website, where they come from, and how they navigate through the site.

These are 28 terms that I believe all martial arts school owners should know if they are looking to grow their business without feeling overwhelmed or being misled or scammed.

There are probably more terms that I didn't mention here, but these 28 should cover what you'll need to know to grow your business online and offline.