While consumers may be cutting back on frills as a cost-saving measure, fitness memberships have become an “essential luxury” for many, with Orangetheory and Lifetime leading the luxury fitness industry.
Luxury country club operator Life Time and luxury boutique fitness franchise Orangetheory are both seeing strong performance in the premium fitness sector despite growing interest in more affordable gyms.
The findings are outlined in a new report from Placer.ai, a software company that leverages location data and pedestrian traffic insights.
Overall, the report highlights that the fitness industry continues to thrive and that despite many consumers cutting back on discretionary spending, a significant number of consumers still consider gym membership an “essential luxury.”
Here are some highlights from Placer.ai’s report:
Investing in member experience pays off for a lifetime
Led by CEO Bahram Akradi, Life Time boasts a loyal and engaged membership base, with 86% of attendance in the second quarter of 2024 coming from regulars (i.e., those who visit the gym four or more times a month) compared to 78.3% at Value Gyms.
The luxury country club operator has been steadily investing in providing enriching experiences for members, from pickleball to personal training, and raised its revenue outlook in August.
In the second quarter of this year, Lifetime saw foot traffic increase 5.4% compared to 2023, while Orangetheory saw a 7.8% increase.
Credit: Placer.ai
Orangetheory advances technology for personalized experiences
Meanwhile, Orangetheory saw a higher percentage of casual customers, but Placer.ai attributed this to the boutique fitness franchise’s class packs being available for longer periods. The heart-rate-based interval training fitness leader completed a major merger with Anytime Fitness parent company Self Esteem Brands earlier this year.
As expected, Life Time and Orangetheory were more likely to attract people earning over $150,000 than lower-cost gyms in Q2. At the same time, value gyms tended to attract fitness enthusiasts with household incomes below $100,000. Still, Placer.ai’s findings show that people earning between $100,000 and $150,000 are about as likely to visit value-focused gym operators, which is good news for high-value, low-cost (HVLP) operators.
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Known for its tech-forward approach and integration of wearables, Orangetheory is focused on providing a highly personalized member experience. Dave Long, co-founder and CEO of the boutique fitness franchise, told Athletech News that Orangetheory is working to enhance its proprietary technology to provide a more prescriptive fitness experience.
“For example, in our Orange60 classes, we’re fine-tuning the role of technology in heart-rate-based interval training to elevate each member’s performance in the studio,” Long told ATN, adding that the brand is also looking at connected strength equipment and personalized workout recommendations through the Orangetheory mobile app.
The future of fitness is bright
Orangetheory and Life Time have established solid foundations, but overall, there seems to be enough of the fitness pie for everyone. HVLP giants like Crunch Fitness and Planet Fitness continue to attract Gen Z fitness consumers with great prices and plenty of amenities, while emerging brands like Chuze Fitness and Retro Fitness are beginning to map out expansion plans for the next few years.
One of the outliers in the burgeoning HVLP industry is Equinox-owned Blink Fitness. After Blink filed for voluntary bankruptcy later this summer, it quickly set its sights on the UK’s PureGym. Pinnacle US Holdings, a subsidiary of PureGym considered one of Europe’s top fitness operators, has moved to acquire the affordable gym brand’s corporate operations and most of its locations, primarily in New York and New Jersey. The deal is subject to court approval.
Courtney Lehfeldt
Courtney Leffeldt has worked in broadcast media since 2007 and freelanced since 2012. Her work has been featured in Age of Awareness, Times Beacon Record, The New York Times, and soon to be published in Slate. She studied yoga and meditation with Beryl Bender Birch at The Hard & The Soft Yoga Institute. She enjoys hiking, the outdoors, and reading a lot. Courtney holds a BA in Media and Communication Studies.
