When local entrepreneur Kevin Scharnek first stepped foot in an Orangetheory Fitness studio in 2012, he had never heard of the company.
He was in southern Florida for a business trip and decided to take a class to get some exercise. The Boca Raton-based fitness franchise had launched two years prior and, at the time, operated about 35 studios in the U.S., Scharnek said.
Seven years later, Scharnek is Wisconsin’s franchise owner and has opened six (soon to be eight) of the nine Orangetheory Fitness locations throughout the state. And the company has expanded to more than 1,100 locations in 49 states and 22 countries.
The fitness concept is based on achieving a target heart rate zone that yields physical results when maintained throughout a 60-minute, high-intensity interval training session. Classes incorporate treadmills, rowing machines and various strength-building equipment.
Orangetheory belongs to an increasingly popular industry category known as boutique or studio fitness. Such concepts differ from traditional gyms of the past by offering specialized, instructor-led classes, rather than rows of treadmills and weight machines. Boutique gyms are characterized by specific disciplines – cycling, barre, yoga, HIIT, CrossFit – and seek to give members a personalized, hands-on experience and a sense of community, experts say.
Consumers in recent years have responded to this model.
According to the International Health, Racquet and Sportsclub Association, studio membership grew by 121 percent from 2013 to 2017. According to a 2017 report by the same organization, 24.6 million Americans were members of a studio.
When Scharnek discovered Orangetheory, the boutique fitness trend had been gathering steam throughout the East and West coasts, but had not yet hit the Midwest, he said.
“I believed in and spent a lot of time talking to other (Orangetheory) owners – at the time there were very few – and other people that have tremendous fitness backgrounds, and felt that boutique fitness category was about to really take off,” he said. “And it has.”
Wisconsin’s first Orangetheory opened in Brookfield in 2014, and since then, boutique and studio gyms have been popping up throughout the Milwaukee area.
They include, but are not limited to, Milwaukee-based PowerCycle in Wauwatosa and Shorewood; Milwaukee-based Spire Fitness in the Historic Third Ward; Chicago-based Shred 415 on the East Side and in Elm Grove; Irvine, California-based Cycle Bar in Mequon and Brookfield; Chicago-based The Barre Code in the Third Ward; Milwaukee-based Brew City Fitness in Walker’s Point; Milwaukee Power Yoga on the East Side; San Diego-based Club Pilates in Mequon; Milwaukee-based Empower Yoga in the Third Ward and Whitefish Bay; Denver-based Pure Barre in Elm Grove and Whitefish Bay; AddeoFit in Glendale; and Orangetheory in the Third Ward, Wauwatosa, Shorewood, Delafield and Mequon.
The recent influx of fitness concepts has made the local market more competitive, especially for gyms that were initially ahead of the trend, said Jeff Winzenried, owner of Monkey Bar Gym in the Third Ward.
Monkey Bar Gym first opened in Madison in 2000 and has since grown to operate 10 locations in Wisconsin, Washington, Colorado, New York, Louisiana, Montana, Connecticut and Canada. It offers functional fitness programs centered on natural training (“no machines, no shoes, no mirrors and no egos”), yoga and clean eating.[caption id="attachment_376740" align="alignnone" width="770"] Construction on the 1,300-square-foot addition at Anytime Fitness in Wauwatosa was completed in April 2018.[/caption]
Winzenried, who has been a trainer for 15 years, opened the company’s Milwaukee affiliate location in 2011, during a time when there were only a handful of boutique gyms in the area, he said. But as that quickly changed over the past five years, Winzenried has worked to adapt his business to industry trends.
“For me personally, as a business owner of a gym that’s been around for eight years and who’s been a trainer for this long and has seen the changes (in the industry), you’ve got to be on the cutting edge, on the leading edge of these trends because now, everybody else is catching up to what we were doing for the past 20 years,” he said.
Right now, being on that cutting edge means improving the customer experience, Winzenried said.
Consumer-facing industries, including fitness, retail and entertainment, have seen a shift toward an experience-driven economy in recent years as people choose to spend more money on experiences than they do on products. This trend, which research has shown is heavily driven by the millennial generation, has changed the way many businesses attract and retain customers.
The industry’s boutique fitness category is no stranger to this phenomenon, especially because the average age of a studio gym member is 30 years old, according to the IHRSA.
“The consumer is moving from product and price to the customer experience as being their No. 1 buying decision,” Winzenried said. “...The client experience has to be genuine.”
For Monkey Bar Gym members, that experience is made up of factors such as its downtown location, unlimited access to its nearly 70 classes each week (for a $100 to $150 monthly fee), its social media presence, and “close-knit” trainers and staff – most of whom started off as members themselves, Winzenried said.
On a much larger scale, the Orangetheory experience is defined by its well-known brand, but more so by its use of technology, Scharnek said.
Each class participant wears a heart rate monitor that tracks his or her beats per minute and calories burned, and broadcasts those numbers on big screens during the workout. That data is then stored for members to access later through their online account.
“After every class, I know exactly how many minutes I was in the orange or red (heart rate) zone, how many calories, what my average heart rate is and, if I’m interested, I can go back and look at the week, the month, the year – I have access to all of that data at my fingertips and I think that’s so important to consumers,” Scharnek said.
But whether it’s a multinational or locally-owned studio, a major draw to and experiential aspect of boutique fitness concepts seems to be the sense of community or camaraderie offered to their members.
That same aspect could also be a driving factor of the rapid growth within the boutique fitness sector and the decline or slower growth of other fitness categories.
Such was the case for Anytime Fitness in Wauwatosa.
When general manager and co-owner Jen Dunnington took on her current role in 2016, the 24-hour health club lacked a culture and opportunities for members to engage with the gym and with each other, she said.
An advocate for community building, Dunnington got to work implementing programs such as monthly challenges to help members feel more involved and connected.
Those efforts later gave way to a 1,300-square-foot addition to the facility, allowing the fitness center to bulk up its coaching services and offer group fitness classes. The $100,000 project was part of a larger corporate initiative to keep up with the boutique and class-based fitness trends, Dunnington said.
“It’s bringing in that Orangetheory idea of working with a group; however, for the people who don’t want to do that, we still wanted to keep the 24/7 access,” she said. “It gives us the chance to work with more people, and then the members really get to know each other that way, too.”