View from the C-Suite: Can Orangetheory’s value make it recession proof?

Why president Blake MacDonald thinks the fitness brand's model and message may be perfect for times like these.

Blake MacDonald Headshot

Founded in 2010, fitness phenomenon Orangetheory has quickly become a household name for many with an interest in their health and wellness. The 60-minute class includes a mix of cardio and strength training, with a unique technological component that allows clients to track their heart rates in real time. It wouldn’t be a stretch to say the method has earned a cult-status following – Orangetheory currently has more than one million members and 1,300 locations across the globe.

Brick-and-mortar gym locations took a hit during the pandemic, with many consumers opting instead to purchase at-home fitness equipment. In fact, Statistics Canada reported a sales increase of 42.5% in 2020 in these product categories.

But as the world emerges from the pandemic and in-person physical fitness becomes the norm again, there are other barriers facing the fitness industry. With so many options to choose from, fitness brands must approach marketing with a clear differentiator that ensures they’ll stand out from the crowd, not to mention proving their worth as inflation skyrockets and Canadians reprioritize where they’re spending their dollars.

These are two areas that Blake MacDonald, president of Orangetheory Canada, says the brand holds strong positioning. With clear messaging that highlights the value of an Orangetheory workout, the brand also focuses on providing clients the biggest bang for their buck.

Here, MacDonald gives us an update on how Canadian Orangetheory studios are welcoming clients back to their workouts.

How has the return to in-person fitness classes been going? Can you speak to any attendance, growth and membership numbers since reopening began?

The pandemic continues to have lingering effects on the fitness industry. Every time a “new wave” is talked about, it causes the almost 30% of former fitness enthusiasts who have simply stopped working out to further delay plans to restart their fitness routine.

That said, August was the start of what we hope is a monumental return to the studios. On August 31st, our 112 Canadian studios welcomed nearly 800 new members across the country in a single day (average of seven per studio) – and over 5,200 members in the month of August (which is the single best August in company history).

This surge of membership is the result of a two and a half year hiatus from fitness for many Canadians and highlights Canadians’ re-commitment to personal health and a returned comfort to in-person fitness. We anticipate this growth to continue through the fall and winter months.

Orangetheory’s recent marketing campaigns have centered around welcoming the “average” person into its classes, and many of your operational strategies focus on the same idea. Can you speak to the market research behind these strategies?

The Orangetheory workout has always been so much more than the regular gym experience. Our certified trainers, science-backed workouts tailored to all fitness levels and real-time technology-tracked performance offer a unique in-person fitness experience that allows us to guarantee our members’ results, no matter what their current fitness level is, or their money back.

Our recent brand research indicates over 70% of Canadians saw purchasing a fitness membership as an investment in themselves. The “More Than a Gym” campaign has endeavoured to re-educate the Canadian consumer on the incredible value of Orangetheory – specifically, how our members get all the benefits of personal training for less than $12/session. Having a fitness professional support you through your fitness journey, coupled with our integrated in-studio technology that shows members results in real-time, makes the Orangetheory experience unique in the fitness industry.

Who do you consider to be Orangetheory’s top competitors, and how do you plan to ensure the brand continues to differentiate itself?

We have many indirect competitors – big box gyms, online workouts, individual personal trainers and other small-studio workout concepts. However, none of these options are able to guarantee results at a per session price that is anything close to an Orangetheory membership.

We continue to innovate both the workout templates and our technology, and our constant focus creating dynamic and motivating coaches will continue to keep a level of differentiation from the rest of our industry.

Inflation is top of mind for many Canadians. How is Orangetheory supporting Canadians’ health and well-being when rising costs might have them re-prioritizing their spending?

While evaluating discretionary spending is important for the financial health of Canadians, it is important that health and wellness do not take a back seat. In an Orangetheory Fitness survey conducted earlier this year, almost all (92%) of Ontarians agreed that having regular access to a fitness facility would be important this year to help combat the negative physical and mental health impacts from the pandemic.

In inflationary times, the average consumer is looking for value. They want a solution that provides them with results – which most often occur by utilizing the services of a fitness professional. That said, with less discretionary income available, the services of a personal trainer are a luxury many Canadians can no longer afford. For this reason, we believe Orangetheory, which provides certified personal training in a small group setting, is the most cost-effective way for Canadians to get their desired results. Unlike a traditional personal trainer, which can cost upwards of $100/session, an Orangetheory workout can cost consumers as little as $12/session.

Can you speak to Orangetheory’s Canadian expansion plans?

As we come out of the pandemic, there are still many markets in Canada that do not have access to an OTF studio and we are aggressively pursuing franchising opportunities in those markets. We anticipate that our footprint within Canada will continue to expand over the next few years as more Canadians seek out the incredible value of the Orangetheory workout.