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CSA Q&A: Orangetheory on fast-track with 260 new sites in 2018

Orangetheory is on a roll. The fast-growing fitness company with a devoted following is opening locations throughout the globe — including U.S. malls.

As to the secret of the company’s success, it may have to do with the fact that Orangetheory is not your typical fitness studio. It offers a science-based, full-body workout that uses technology to measure performance so members can track their performance. Orangetheory’s 60-minute, total-body group workout classes focus on high-intensity interval training, with members cycling through a treadmill, rower and more. Each class has a different focus, such as power or endurance, and is led by highly trained — and highly motivating — coaches.

Members wear heart rate monitors during the workout, with their heart rate displayed on performance screens that are located throughout the studio. Heart rates are broken down into five color-coded zones that range from very light activity (grey, which is 50% to 60% of maximum heart rate) to uncomfortable (orange, 84% to 91% MHR) to the highest (red, 92% to 100% MHR).

According to Orangetheory, 12 minutes in the orange zone is all that is needed to charge metabolism and create the company’s signature “afterburn,” or “Orange Effect,” whereby participants keep burning calories for up to 36 hours after a 60-minute workout. Membership rates vary, with a range of packages to choose from, from Basic (four classes for about $59/month) to Premier (unlimited classes for about $159/month). But the prices can vary.

Chain Store Age spoke with Mike Mettler, senior VP of franchise development, Orangetheory Fitness, about Orangetheory and the demographics that made it an attractive mall tenant.

How is Orangetheory Fitness positioned in the fitness studio category—what are its main points of differentiation?
At Orangetheory Fitness, we make it simple for our
members to get more out of their workout. And while
there are countless other concepts in the fitness category, we pride ourselves on our unique trifecta of science, coaching, and technology.

We energize. Our highly trained coaches inspire each and every member to do their best.

We switch it up. Our workouts change every day so our members never get bored. We know it works. Spend 12 minutes or more in the Orange Zone and participants will burn calories long after their workout.

And we celebrate. Our members are more like family. Our community atmosphere is unmatched.

When did the first location open?
In 2010, in Fort Lauderdale, Florida

How many locations — and members — does the company have in the U.S.? Are they all franchised-owned?
We currently have 901 locations [for a total of more than 1,000 worldwide] and over 700,000 members. Of our locations, 877 of are franchised-owned.

What is the typical member demographic?
Our member demographic is adults 25 to 44 years old, married, highly educated, working forty-plus hours a week with a household income of $90,000 plus.

Between work, parenthood and trying to maintain a social life, our members are challenged for time and look to friends or colleagues for advice and recommendations. They are keen on things that can make life easier and don’t mind paying a little extra for something that works for their lifestyle.

Does the concept translate globally?
Yes. We are currently open in 19 countries around the world.

How many new locations will Orangetheory open in 2018, and 2019?
We will open more than 260 locations this year. Our goal is to continue to open at that pace looking towards next year.

What is the average size of an Orangetheory and what type of locations work best?
Our average footprint is 3,000 sq. ft. In general, we look for upscale-oriented locations in both established and growing markets.

Do mall locations fit into your strategy?
Yes, there are Orangetheory fitness locations in malls. And malls are a part of our development plan.

What type of reaction are you getting from mall developers?
We have gotten very positive reactions from mall developers. Orangetheory is an attractive tenant because it draws new traffic to malls. We also serve as a great neighbor tenant to other businesses.
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