The hard truth: Over 80% of boutique fitness studios are not profitable. We went undercover and talked with studio owners in NYC about the challenges they’re currently facing. Here’s what we learned, and how we’re working closely with our current and future partners to address these challenges in how we’re building Arcana.
Challenge #1: There are a lot of fitness-obsessed people in NYC… but there are also over 1,000 places to work out.
The fitness sector is bustling, with boutique studios popping up at every corner, each offering unique workouts, from HIIT sessions to aerial yoga. Walk a couple blocks in the West Village or Flatiron and you’d pass 20 of them in a 10-minute span.
For the consumer, this is amazing. We have a lot of choice, and the competition among studios is driving innovation and raising the bar for what a quality workout looks and feels like. It’s more than just getting a good sweat that makes an excellent boutique fitness studio stand out. There’s an expectation of white glove service from start to finish, starting with the booking experience and flexible pricing options, right down to the products in your showers.
For studios, though, this competition puts real pressure to stand out and create something sticky that makes people want to come back. Marketing and branding matter a lot here, and that’s why so many of the city’s most successful boutique fitness studios have relied on the star power of their founders to drive continued excitement and loyalty.
Challenge #2: Traditional gyms are making moves to become the one-stop shop for your fitness routine.
Places like Lifetime, Equinox, and Chelsea Piers are adding more classes as part of their monthly memberships, offering variety to consumers who want more than just equipment access. Even Crunch came out with a reformer pilates option. The same way these places absorbed juice bars and smoothie counters, they now want people to get their full workout in without ever needing to leave the building.
Many of these gyms are actively poaching instructors from boutique fitness studios in an effort to grow their audience base, and that part makes sense, because people follow their favorite instructors.
Challenge #3: Not every instructor is the founder.
With multiple studio locations and a different set of staff at each, there are going to be classes that fill out every week and classes that don’t. This mix can lead to inconsistencies in service quality, ambiance, or training methods.
In our exploration of trying out the best boutique studios in NYC, we’ve made a point of taking class with the founders of these programs, and the difference is noticeable. From booking to the actual experience in the room, you can feel it. This isn’t to say that the other instructors aren’t good; we haven’t had a bad experience in any class we’ve taken. But the reality is, not every AARMY instructor is Akin Niko, and not every Soto Method teacher is Hilary Hofman. That gap is a real challenge for studios trying to scale what makes them special.
Challenge #4: People want variety in their workout.
Around 73% of boutique studios specialize in a single type of training, and that’s intentional. Specialization works. It’s genuinely hard to be excellent at more than one thing, especially when you as a founder or head trainer are certified in that one specific discipline.
Consumer behavior (and the science behind it) shows that people generally gravitate toward variety in how they move. I’ve talked to a hundred people who swear by [solidcore] but also Barry’s or Orangetheory on the side. Some studios have tried to respond by layering in non-core offerings, but it usually ends up feeling like a compromise rather than a strength. The studios that try to be everything tend to lose what made them worth going to in the first place.
Challenge #5: Demand fluctuates by the season.
Some workouts are more popular in summer, others not so much. Cole and I teach traditional hot yoga, where summertime is the least popular season. Understandably, because who wants to be in a room heated to 105 degrees when it’s already mid-90s and humid outside. Other modalities, like dance, have summer as their peak season. I was talking with one of the co-owners of 305 Fitness in Williamsburg, and she mentioned how a lot of people come in looking for something fun to do on a nice summer day when work isn’t as hectic. That behavior makes complete sense, but it means studios often have to reorganize their schedules and anticipate real swings in membership revenue at different points in the year.
What We’re Doing About It
These challenges aren’t secrets. Studio owners are living them. What surprised us most in our conversations wasn’t how many problems exist, it was how openly and honestly people talked about them. There’s real frustration, and there’s also real hunger for something better.
That’s exactly what we’re building Arcana around. Every design decision we’ve made: how members book, how we structure our partnerships with studios, how we think about commitment… has been shaped by conversations exactly like the ones above. We’re not building a product on top of the fitness industry. We’re building one that actually listens to it.
More on how that translates into practice, coming soon.