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.
FAO Schwarz in global expansion as part of comeback strategy
FAO Schwarz unveiled ambitious plans for its return to retail.
The storied toy retailer has set an opening date of November 16 for its Manhattan flagship, which will be located at 30 Rockefeller Plaza. It will mark the company’s return to the Big Apple after it closed its landmark Fifth Avenue store in 2015, and opens months after FAO’s former owner, Toys “R” Us, filed for bankruptcy and shuttered all its U.S. stores.
The 20,000-sq.-ft. Rockefeller Plaza location will feature FAO’s signature retail experiences, including its iconic dance-on-piano, along with magic shows, a kids’ grocery shopping experience, and a build-your-own RC race car station, among others. It will also sell the brand’s signature toys, and items from such partners as Build-A-Bear and FAO Schweetz (in partnership with It’Sugar.)
FAO is also expanding into Canada, with plans to open permanent in-store shops across Hudson’s Bay’s 89 stores. The shops will range in size from 300 sq. ft. to 1,000 sq. ft. Merchandise will also be available online.
The retailer is also giving its brand exposure outside of North America, with holiday pop-ups in several major department stores. The retailer is partnering with the U.K.’s Selfridges to open two pop-ups in early November. In Spain, FAO will open a holiday-pop up at El Corte Ingles in Madrid. And in a deal with Australia’s Myer Australia, FAO will open a pop-up in the chain’s two flagship stores, in Sydney and Melbourne.
In addition, FAO will open a 27,000-sq.-ft. flagship in Beijing, China, via Kidsland China, slated for March of 2019. Additional stores and pop-ups will open over the next few years.
“The expansion to these countries further exemplifies FAO Schwarz as a global kids lifestyle brand,” said David Conn, CEO of ThreeSixty Brands, owners of FAO Schwarz. “FAO Schwarz was built on in-store experiences, which has made it a global destination over the years. In partnering with these amazing companies around the world, we are able to bring back that wonderment of toys and a deep nostalgia for the larger than life experience that FAO Schwarz has offered to parents and children alike for over 150 years.”
FAO, whose roots date back. was acquired by Toys ‘R’ Us in 2009. It once operated about 40 stores nationwide, but eventually was down to only the New York flagship. In 2016, Toys “R” Us sold the brand to ThreeSixty Group, which designs, makes and distributes toys and other consumer products to retailers nationwide.
BuzzFeed to open a toy store—with a twist
Online news and quiz site BuzzFeed is going to try its hand at physical retail.
The company will open a toy store called “Camp” in Manhattan’s Flatiron District later this fall, reported the New York Post. The 11,000-sq.-ft. store will sell toys in the front, while the back will be set up as a related “experiential” area designed for social media photo sharing.
In a twist, Camp will change its theme and overhaul its merchandise several times a year, which is similar to a strategy pioneered by another Manhattan store, Story, which reinvents itself every couple of months. Rachel Schectman, founder of Story, is serving as an advisor on the BuzzFeed retail project, according to the Post. (Story was acquired by Macy’s In May.)