When I walked into an Orangetheory Fitness studio for the first time, it felt as if I was walking into a nightclub. The room was dark, drenched in a dim orange glow, and hip-hop thumped out of every corner of the room.

As I ran on the treadmill, I couldn't help thinking about what Dave Long, the co-founder and CEO of Orangetheory Fitness, had told me earlier about the brand experience. 

On the phone, I had expected Long's voice to be expressive, loud, and fast, kind of like a trainer's, but he communicated with a level, tranquil tone.

We talked about how Orangetheory Fitness (OTF) works, why the brand is growing, and how Long biohacks his productivity. Below, he shares his top takeaways to help business owners and CEOs improve and grow their own companies.

The formula to OTF's success comes from how it stimulates users on the three main levels of the human condition: intellectual, physical, and emotional. The experience is designed to engage brains, feelings, and bodies. Most fitness gyms accomplish only two of these three.

For example, a Zumba class might produce the physical and emotional states: the room pulses like a unified dance crew and participants move their bodies together, and a crossfit gym breeds the same kind of two-parted tribalism, where participants compete with passion and do really hard physical things together, but what both of these workouts are missing is the intellectual component. This is where Orangetheory Fitness pulls ahead. By leveraging the data from personal heart rate monitors, OTF users are constantly aware of their performances, in the form of their average heart rate, caloric burn rate, and "splat points." One splat point is equal to one minute spent in the orange zone and red zone (see chart below).

The name "splat point" comes from the sound of a fat cell exploding, according to the brand. Users should aim to reach at least 12 splat points per workout (one hour) to attain optimal caloric burn.

This statistical gamification of working out is OTF's key differentiator. It feels like you're playing a video game with your body while winning cognitive achievements.

Gamification, the process of turning a mundane task into a rewarding game, is only possible through technology. The wearable heart rate sensors generate data, and this data gives users the ability to measure their workout. It's analogous to digital marketers using Google Analytics to track and compare results as they happen.

I had heard that my stats were visible to everyone else in the room, and worried that the strangers in the class would judge me if I fell behind or zoomed ahead. Instead, the architects of OTF circumvented this possibility by displaying only subjective stats (i.e., heart rates), not objective stats (i.e., distance). In other words, a heart rate of 160 for me can't be compared to your heart rate of 160 since our bodies are inherently different. Instead of promoting self-performance over group performance or vice versa, it was balanced. The more the screen filled with orange the better the group was doing. By the end, we celebrated the total number of calories burned by the group. Yet, the trainer did highlight the people who burned the most calories individually. So instead of pitting users against each other like a race, OTF does a good job prioritizing group unity and individual results over self-glorification or any potential for shaming.

Zooming out of the studio and looking at the big picture, Orangetheory Fitness has 930 locations worldwide. Since it opened its first studio in Fort Lauderdale in 2010, there have been no closures. As a global franchise, CEO Dave Long reported that network-wide annual revenue is set to cross the billion dollar mark this year. Long's vision is to open 300 new locations a year, as the brand aims to shift towards international expansion.

It's no secret the $87.5 billion fitness industry is saturated. Planet Fitness has 1,400 locations, Anytime Fitness has 2,000, and Gold's Gym 600. Overall, trends show that more and more Americans are signing up for gym memberships. But when it comes time to choose, their options are numerous. Here are Long's five strategies that helped differentiate his fitness brand and scale massively. While these tips come from Long's experience with OTF, they are applicable to any business owner who wants to become a major player in their industry.

5 Tips on How to Stand Out From the Competition in a Saturated Market

1. Get noticed with eye-catching guerrilla marketing tactics

Starting out, Long and his team deployed several over-the-top stunts to build local brand awareness before opening a new location. "We tried almost every type of guerrilla marketing campaign," he said, leveraging the bright orange color of the brand. One was the Orange Bike campaign where the team bought 200 orange bicycles and placed them around town for people to ride. The staff would also ride them. "It created a buzz that we were coming," he said. Similarly, OTF staff wore full body orange morph suits and stood on street corners, walked into local stores, and ran in 5k races. "We don't really use [them] anymore," said Long, noting that today the brand has enough recognition. Another guerrilla marketing campaign idea involving ping pong balls but didn't work out so well. "We got all these small fish bowls and filled them with orange ping pong balls with different offers. We placed them in small businesses around town and numbered the balls. It didn't get a lot of traction and created a lot of admin work."

2. The key to overcoming failure is rigorous team training

The scariest moment of Long's career happened after he and his co-founders Jerome Kern and Ellen Latham decided to franchise Orangetheory Fitness in 2012. Long recalled, "We believed in the science and effectiveness of it, but were people really going to do it?" They launched the first number of franchise units but they grossly underperformed compared to corporate. "The train had left the station but with little success," said Long. "Is this fixable? Why wasn't it replicating success?" The CEO pointed out that with franchising you can't just fire and hire. The key to turning the ship around was hinting to franchisees, revamping training systems, and persistent follow-ups. "We stopped opening new locations and focused on training systems," he said. "It was a tense number of months." But their efforts started to pay off when the second wave of franchises started to open with better-trained operators. The performance of these new locations ended up exceeding corporate and the first locations.

3. The secret to scaling your business is hiring passionate people

Every year, the OTF studios host five million workouts. The workforce behind this production is 75% millennials. So when it comes to hiring, Long said he looks for people who view the mission of the organization as more than just a job or a hobby. "Are they willing to go the extra mile? We dig in to find that commitment," he said. For franchisees, they need to be leaders who can do two things: lead by example and build great teams. "Our core employees are so passionate they don't let anyone have a bad workout and fall through the cracks."

4. Remove barriers with a ubiquitously accessible brand

It's easy to delight a customer once they begin their workout, but how do you get them through the door in the first place? For OTF, there are three keys to sales. One, location: "We look for the most visibly trafficked areas, near a Whole Foods or a healthy grocer, with high walk-by rates," said Long. Yoga and Pilates studios nearby are also complementary. Second, convenience: All OTF studios operate with the same machines and schedule, so members can stick to their usual workout routines regardless of location. Third, a central hub app: Users stay connected to the brand through the OTF mobile app which logs their data, provides health tips content, and sends community alerts for local events and runs.

5. Pro tip for CEOs: how to discipline your mind and biohack success

When you're at the top of a billion-dollar company, it can be challenging to know what strategic initiatives to prioritize and focus on. Dave Long's discipline is closely tied to his health, which he uses to augment his productivity. "I'm a student of finding new ways to find energy," he said. This attitude of exploration has led the chief executive to avant-garde activities such as extreme sports, infrared sauna sessions, and regular ice baths -- pursuits that he believes delay the aging process. Long operates knowing his physical and mental faculties are tied closely together. As such, he breaks away to find time to level set and clear his mind during the day. He meditates daily, checks email only twice a day ("Email is not a barometer of productivity," he said), and submerges himself in freezing ice water for five minutes before bed every night. "[It] never gets easier. It's always brutal," he said. "But afterwards, my body unwinds and I immediately knock out, asleep," he said. "It's a love-hate thing, like exercise, and creates a positive sense of accomplishment."

Fortunately for the rest of us, ice plunges aren't part of the Orangetheory Fitness approach (yet), however, Long's philosophy and rigor are palpable in the OTF workouts. When we push ourselves beyond our limits and overcome our natural tendency to resist discomfort, we end up feeling more positive and confident. Add to that technology, data tracking, and a community sweating under ambient orange light and you have the theory behind Orangetheory Fitness.

Published on: Apr 23, 2018