Planet Fitness Names Colleen Keating CEO at Pivotal Time for Gym Brand
Keating will look to grow the gym giant while wrestling with key decisions including potentially increasing the price of a Planet Fitness membership
Planet Fitness has named Colleen Keating its new CEO, which comes as the high-value, low-price (HVLP) fitness operator continues to win with Gen Z but also looks to move past turmoil including calls for a boycott and questions over its membership pricing model.
Keating will take the post on June 10, 2024. Craig Benson, who has been serving as interim CEO since Chris Rondeau’s abrupt departure last September, will remain on the Planet Fitness board of directors.
“As the next CEO of Planet Fitness, I am eager to begin working alongside the management team and hit the ground running as we position the business for sustainable growth and value creation,” Keating said. “I have long admired the Planet Fitness brand and could not be more excited to dig in and help the company reach its fullest potential.”
Keating will receive an annual base salary of $1,000,000 and is eligible to receive an annual cash bonus, with a target of 150% of her base salary, according to an SEC filing. She previously served as CEO of FirstKey Homes, LLC, a rental home property management company and has held prior leadership roles at InterContinental Hotels Group and Starwood Hotels & Resorts Worldwide, giving her franchising experience.
Stephen Spinelli, Jr., Ph.D. and chairman of the board, remarked that Keating’s appointment was the result of an extensive search process for a permanent CEO. At the time of Benson’s interim appointment, the company said it was considering both internal and external candidates.
“Colleen’s deep operational knowledge, strategic mindset and understanding of large-scale franchise operations and consumer-facing brands made her stand out among the candidates considered,” Spinelli said. “She also has a proven track record of building results-oriented teams and instilling cultures that put a premium on operational excellence and rigor, which we believe will be additive to Planet Fitness.”
Under Benson’s leadership, Planet Fitness rolled out a new growth model for franchisees that relaxes remodel and re-equip requirements. The gym chain also began exploring a membership price increase for its $10-per-month basic-entry White card — a move that has drawn the attention of analysts and will likely be an early priority for Keating.
What’s Next for Planet Fitness?
Keating’s appointment comes at a pivotal time for Planet Fitness, which has been a hit with Gen Z consumers and is nearing 20 million members but is also facing some headwinds.
The fitness franchise had reduced its new location outlook for 2023, citing new store construction costs and rising interest rates. Shares plunged last fall after Rondeau was ousted in a move that “blindsided” the former CEO, as allegations began to surface that he created a toxic work culture.
By November 2023, solid Q3 revenue numbers and investor confidence over the news that Planet Fitness was exploring a membership price increase led to shares rebounding following Rondeau’s exit. At the time, Benson indicated a desire to improve branding and promotional marketing while remaining mindful of Gen Z’s appetite to engage with brands based on their values and messaging.
Planet Fitness was hit with another unexpected bump last month after canceling a woman’s membership for filming a transgender member in the women’s locker room, causing a social media firestorm and leading to its stock taking another slight hit. Planet Fitness has remained firm in its stance that the woman violated its photography and videography policies and affirmed its commitment to an inclusive atmosphere.
Following the incident, investors said they remained mostly bullish on Planet Fitness’ future outlook, pointing to its strong membership numbers and success with Gen Z.
