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The retention theory that forms the core of the content of this page is derived from a methodology developed and used by The Educational Funding Company, although its idea has been further developed for the purposes of this resource.

The half-moon theory is based on two key principles. The first of which is that contracts are cyclical rather than linear and the second principle is that of ‘re-recruitment’, which means a highly level of engagement with the client once the contract reaches its midpoint. This means that each contract term does not actually have an ending but simply returns to its start point and the cycle repeats itself.

Retention, and its simple synonym ‘keep’, imply pro-activity rather than reactivity so the theory argues that if a contract has reached the red zone before additional engagement has been achieved then retention actually becomes more reactive and difficult to achieve. A client should be ready to sign a new contract by the end of the 10th month even if it is not actualised until later.

The key to this proactive approach is to increase client engagement from the midpoint of the contract and the following approach should be taken.

Green Zone (Normalised Practice)

When a contract is in the green zone it should be monitored as is best practice but it actually does not require too much maintenance provided that the client is generally satisfied.

Orange Zone (Heightened Engagement)

When a contract is in this zone the client should be encouraged to increase engagement and involvement and more actively communicated with. This then prepares the client for making a renewal which should ideally be presented towards the end of the orange zone (during the second half of Month 10).

Red Zone (Last Chance)

The theory argues that this point should never be reached as it becomes a more reactive process (‘I need the renewal because I will lose the client’ rather than ‘I would like the client to sign up and continue with us’). It is quite late, but can still be redeemed through engagement.

The earlier the increased engagement begins (after the midpoint) the less likely the client is to connect it to the renewal process and the more effective it can be.

Case Study – Acme Martial Arts Academy

Acme uses the Half Moon Theory and it is implemented in the following way, dependent on which zone its active contracts are in.

Green Zone

During this part of the contract cycle the client is monitored normally. Are payments good and timely? Is the client engaged? Are they attending training sessions? Are they comfortable in the dojo? Are they forming friendships? Are they progressing? If the answer to any or all of these questions is no the client needs greater engagement to address specific issues.

Orange Zone

Within the orange zone the client should experience greater engagement so this is more intense than any monitoring process that is carried out during the green zone. Greater engagement at academy can include any or all of the following:

‘We notice you are having difficulties with mastering a specific skill. We would like to offer you a 1-2-1 session to help you improve this.’

‘You are doing really well here, would you like to help the class with warm ups and warm downs.’

‘I think you are almost ready for you next grading (belt promotion), if we work together over the next few weeks I think we can achieve this within the next 6 weeks.’

‘Would you like to show some basic skills to some beginners? We will show you how to do it.’


‘If you are able to sign your renewal early we can hold last year’s price for you.’

Red Zone

Almost certainly too late to attempt any of these methods, but may still work. Teaching on half-moon states that it should never get this far. You may sign many of the renewals during the red zone but the renewals should have been pledged within the orange zone.

© by Richard Horton 2016 (Omega Support Services)