Orangetheory Fitness studios will 'be back in hypergrowth mode' and 'stronger than ever' in the long-term: CEO

Gyms across New York State are set to reopen on Monday with proper safety protocols in play. Dave Long, Orangetheory Fitness CEO and co-founder, joins Yahoo Finance's The First Trade with Brian Sozzi and Ines Ferre to discuss reopening efforts, the future of fitness and much more.

Video Transcript

BRIAN SOZZI: All right, the nation's gyms are looking for some healthier days ahead as states allow their reopening despite the pandemic continuing. Let's bring in Orangetheory's CEO David Long. He oversees more than a thousand locations worldwide. David, I think I need to squat 200 lbs after that Tesla discussion we just had. But walk us through your reopening process. What steps have you taken to keep gym goers safe?

DAVE LONG: Yeah, thanks, Brian. So, you know, we've been reopening our studios going back to May. And I think, you know, what's good is we've always been by appointment only. We've never shared equipment. We track everybody who's in and out of the studios. We were kind of ahead of the game. We added in additional cleaning protocols, longer breaks between classes so we could do a deep clean, and have really stuck to that-- temperature checks and monitoring before each session every time a member books to come in. And so we've been building up that muscle for the last couple months. So excited to start opening New York today.

BRIAN SOZZI: And what about your digital push?

DAVE LONG: So digital has been really important for us. The pandemic has accelerated our strategy. You know, we launched Orangetheory at Home back in March. We've had over 16 million workouts, both from members and nonmembers trying out Orangetheory. And so we've been developing that product to really meet our members wherever they're at, and so we're going to continue to develop that out. You're going to see some big announcements coming in October about Orangetheory Anywhere.

BRIAN SOZZI: And, David, you are one of the most, I think, aggressive gym-opening chains in the country. How has the pandemic made you rethink how many stores you do open?

DAVE LONG: You know, we think the long term we're going to be back in our hypergrowth mode. We have been opening 250 new locations just in the US every year. Obviously this year that will be cut in half. But as we look to 2021, we want to start to regain that momentum, and we think-- we think long term, the studio industry, people working out in the community is actually going to bounce back and be stronger than it ever was before.

INES FERRE: And, David, Ines here. What has your retention rate been like during the pandemic as you've reopened some of these places? Are you seeing people coming back, or are some petering-- tapering off?

DAVE LONG: Yeah, a great question. So we've allowed the member to have flexibility to stay on a freeze if they want to wait and see. Also, they can partake in the Orangetheory at Home workouts. But the majority of our members when we reopen in a state or city are coming back right away. There's kind of a pent-up demand. They want to get back into their fitness routine, and so that's really helped drive it. But we do have people that are kind of wait and see, and we're going-- you know, we'll be there when they're ready to come back.

BRIAN SOZZI: David, there's, what, close-- or there were 40,000 gyms across the country, yet the government has not provided any stimulus, any help to these, in many cases, franchised businesses. Is it time the government steps up and does get you relief, and what type of relief would you like to see?

DAVE LONG: I think we're fortunate in that most of our franchisees were able to partake in the PPP programs, which helped for the short term, but that quickly ran out. So we would like to see, you know, the government take a more active role in fitness, and wellness is so essential for our world and the US more than ever.

And we've formed a fitness alliance of over 30 of the largest US and global brands. You're going to see starting in September a real push to really bring that to the surface and make sure that the fitness industry is not forgotten.

INES FERRE: And, David, after a vaccine comes on, do you expect the fitness industry to go back the way it was before? Are you expecting some of these changes that you've seen during the pandemic to last even after a vaccine?

DAVE LONG: We believe that there will be some artifacts. We believe our members still get their best results and motivation by coming into a studio, but we think that they're going to mix that with some digital. And we've even stood up outdoor workouts at 300 locations, and our members, surprisingly, are actually really enjoying the outdoor flavor of Orangetheory. So we think it's going to be really a combination of all those products that are going to meet the members wherever they're at.

BRIAN SOZZI: David, before I let you go, I have an Orangetheory across from me where I live. It has been broken into twice during the pandemic. I would say about the past three or four months. Have you seen that at other locations or I'm just a special person that has people breaking into his Orangetheory?

DAVE LONG: Yeah, it's horrible and unfortunate, and it's happened in Cleveland. It's happened in South Loop, Chicago, even in South Florida where we're based. So, unfortunately, studios have been sitting closed, and, you know, we've been a victim of that a number of times.

BRIAN SOZZI: What have they taken?

DAVE LONG: You know, there's not much to take in our studios. It ends up being some computer hardware and things like that. You know, they're not-- they're not carrying dumbbells and treadmills out the door. So that would be a different type of workout, I guess. But yeah, just take some of the technology.

BRIAN SOZZI: Well, I guess they're getting some type of workout. Let's leave it there. Orangetheory CEO David Long, good to see you, and good luck on the road to recovery.

DAVE LONG: Thanks so much. Take care.