Prior to the COVID-19 pandemic, the Canadian fitness market place was becoming saturated amid competition for a slice of the Canadian fitness segment. COVID-19 chased Canadians into lockdowns and quarantines causing havoc on many levels, including affecting fitness routines from coast-to-coast. Some Canadians turned to eating their way through the pandemic but home fitness equipment sales skyrocketed.
Retail Insider reported in September 2020 on how gym memberships and attendance plummeted in Canada. Some fitness chains tried to pivot into online or virtual offerings like guided workouts or interactive Zoom-like sessions. December 2020 wrapped with an unpleasant gift to struggling fitness businesses as Apple launched its ‘Apple Fitness+‘ service which promises to disrupt the Canadian fitness industry.
Apple Fitness+ is an online platform that requires an Apple Watch to participate and provides guided workouts for treadmills, rowers, yoga enthusiasts, dance, core, strength, high intensity interval training (HIIT), cycling, and more.
Apple Fitness+ Reinventing Canadian Fitness Industry?
For our “type A” readers in the crowd, the simplest and quickest example of Apple Fitness+ disrupting the fitness industry can be summed up in the following consumer-focused example, based on using Apple Fitness+ since it launched on December 14, 2020:
- Pre-Pandemic: Unlimited OrangeTheory Membership was $189 per month per person. 20 minutes to drive each direction to get to studio. 450 calories burnt during a 45 minute guided HIIT workout.
- Apple Fitness+: Unlimited workouts (HIIT, rowing, strength, yoga, etc.) for $12.99 per month for a family up to five. 650 calories burnt in my basement home gym during 45 minute workout (broken down by a 20 minute HIIT, 20 minute jog on treadmill and a 5 minute mindful/guided cool down).
Based on price, Orange Theory cost $378 per month for a couple plus an hour of driving time (gas costs, parking, etc.) versus Apple Fitness+ cost of $12.99 per month for a couple.
Based on effectiveness, an OrangeTheory 45 minute workout burnt 450 calories on average for me. Apple Fitness+ burnt 650 calories in 45 minutes based on the workouts which were selected.
Based on time usage, OrangeTheory required a 40-60 minute commute to get to and from. Apple Fitness+ is in-home and it can be done anywhere (in a hotel, at home, in a fitness gym).
Apple Fitness+ is the clear winner based on price, effectiveness and time-usage which garners it the title of being a fitness industry disrupter. Even at launch, the variety alone is also an asset for the service.
Price Point
The monthly fee for Apple Fitness+ varies from country to country, but the Canadian monthly fee is $12.99 per month and this give us up to five family members access. It is also available through the Apple One premier bundle which give a family access to Apple Fitness+, Apple Music, Apple TV+, Apple Arcade, Apple News+ and 2TB of iCloud storage.
In contrast, unlimited Orange Theory in-studio workouts were $189 monthly per person. During the pandemic with shutdowns, OrangeTheory has launched an unlimited OTLive offering for $129.99 monthly per person. OTLive are Zoom-like OrangeTheory classes focused on floor workouts where live coaching in a group (limited number of participants). You still need to provide your own equipment for weights and benches. All interactions with a coach through a chat and camera interface while lunging, planking, side-to-siding and various other workouts.
$378 per month for a couple for OrangeTheory in-studio or $260 for OTLive Zoom-like classes versus $12.99 per month for a couple using unlimited Apple Fitness+ isn’t fairing well for the future of OrangeTheory.
The Apple Advantage
The first iteration of the Apple Watch came to the market in 2015 and it has progressed with a new version every year with a focus on fitness and health. “Apple Watch owns half the worldwide smartwatch market and remains the clear industry leader” said Neil Mawston, Executive Director at Strategy Analytics in a press release. “Apple Watch shipped 7.6 million units worldwide in Q1 2020, rising an above-average 23 percent from 6.2 million in Q1 2019. Apple’s global smartwatch market share has grown from 54 percent to 55 percent, its highest level for two years” said Mawston.
The Canadian fitness industry has cast a wide net to cater to every possible path to the Canadian fitness dollar imaginable, from the value-priced chains (like Fit4less and Planet Fitness) to the luxury market (like Equinox) to group fitness (like Crossfit, Orange Theory, F45 Fitness and Barry’s Bootcamp) to virtual/remote fitness (like Peloton).
- Value Priced chains: The appeal is the price. Fit4Less is $10.49 biweekly (or $21 monthly) for 24 hour access to a fitness facility with various amenities, like sun tanning booths, aqua massage equipment, etc.
- Luxury Market: The appeal is prestige and exclusivity. Towel services, group fitness classes, etc. to turn the gym experience into a destination experience.
- Group fitness: The appeal is working out with others to achieve a balance between cost and staying motivated by working out with a community.
- Virtual fitness: The appeal is convenience and it usually comes at a cost. Peloton locks in users by having them purchase the proprietary bike or treadmill (yes, there are many hacks on Youtube to get a knock-off equivalent).
Looking across the four markets, Apple is coming in at $12.99 per month (sorry value chains) with exclusivity for Apple Watch users (sorry luxury market) where you can work out with the trainers (sorry group fitness) in a virtual environment (sorry virtual fitness market).
Apple Fitness+ Disadvantage
After all the disruption review, Apple requires users to own an Apple Watch to use Apple Fitness+ service. This likely will not go over well in the Android market but Apple has had six years of developing the typical Apple cult following for the Apple Watches, including coming out with a more economical Apple Watch SE version this year.
Next Steps for the Canadian Fitness Industry
Returning to the Canadian fitness industry view, the various fitness business models being used by the Canadian fitness titans like Orange Theory, Fit4Less and other facilities took a front-facing hit from Apple with the launch of Apple Fitness+ due to price, convenience and effectiveness. Most Canadian fitness retailers have been expanding aggressively pre-pandemic, including Orange Theory’s expansion, Barry’s Bootcamp expansion and Soul Cycle’s expansions featured in Retail Insider.
Many will try to rest on the ‘fitness community’ they build; however, anyone who knows the Apple cult culture knows that isn’t going to sustain their business models. Technology has played a role in Peloton as well as boutiques like F45 and Orange Theory which gives these titans experience on getting ahead of Apple but do they have the research and development abilities of Apple?
Aside from the #ShopLocal and #SupportLocal movements, the Canadian fitness industry is likely revising their business models as they speak. As Apple revolutionized the mobile phone market with the iPhone and the music consuming market with Apple Music, we are about to see some new developments in the Canadian fitness market in 2021 as entrepreneurs get their juices flowing to attempt to pivot and thrive with the new normal of Apple Fitness+.
Let us know if you would like to hear more about fitness products by Retail Insider. Sound off in the comments below.
Almost entirely agree. The one, more qualitative metric is the simple fact that humans are social beings and gyms are the new churches. To the extent that gyms, whatever their model, can provide social interaction and community, they will command a price premium over purely virtual experiences.
Hi Ralph, very true. Though I did try the virtual “OTLive” virtual experience and can compare to the Apple Fitness+ experience. Agreed that there are social benefits/draws for folks as well for the in-person that home-gyms cannot compete with.
Did you compare the Nike Training Club App? It actually offers a variety of workouts and plans for free and has capabilities to screencast from a mobile device to TV.
No I didn’t, but I absolutely will now! Apple Fitness+ plays natively on Apple TV, but if you want to screencast/mirror from your iPhone/iPad, you only get the audio – so its definitely working out some functionality (being launched for only 4 days so far).
Question for you. When Apple came out with the iPhone, all other touch screens on the market basically were scrapped because of the new ‘bar’ set by the iPhone. Yes, its not the same here, but Samsung had been putting TouchID onto their devices for years and then biometric functionality seemed to get more mainstream when Apple launched TouchID/FaceID on their iPhones. With those two instances in mind, I get the feeling that the brand recognition of Apple and the other Apple services (like using Apple Music in the fitness app) may get Apple Fitness+ more mainstream adoption than other fitness apps like Nike.
Thoughts?