Zumba Fitness: Company of the Year 2012

Posted by on Mar 13, 2013 in Featured Posts, Zumba® | Comments Off on Zumba Fitness: Company of the Year 2012

You know what’s even healthier, stronger, and more flexible than a Zumba® instructor? The business model behind Zumba®.

Back in the ’80s, when Alberto Perez was a skinny teenager aping Michael Jackson’s moves on the mean streets of Cali, he would dream of a night like this one. August lightning crackles outside the Orlando Convention Center as Perez, his GI Joe musculature shellacked in sweat, commands the stage in a dark, cavernous hall. Over two hours, he dances to an accordion and to an electric guitar, in a Russian fur hat and in a bright red kilt, with children and with Vanilla Ice. His lunges are deep; his hips undulant. In a free spirit’s version of unison, 8,000 dancers slam, sling, and snake along with him. Edging into the press of bodies, I try to mimic their steps but clock some woman in the cheek. Three days into this reporting trip, and I am still not ready for Zumba®.

That puts me in the minority. In this age of social stratification, Zumba®–a dance-fitness program born in Colombia–qualifies as a genuine mass-market phenomenon. It is a democracy of cool where the cheerleader, the goth, and the fat kid from high school are besties. You can do it, and so can your preschooler and your grandmother. Fourteen million people in 150 countries take Zumba® classes at least once a week. Eighty nationalities are represented at this instructors’ convention, an annual event that is part professional education, part Woodstock with cargo pants. “I look around, and there’s women and men of all shapes, and I don’t mean just up to Size 16,” says the actress Kathy Najimy, after delivering a keynote address on the convention’s opening morning. “Diverse people of all colors. Lots of gays. Lots of straights.Single people. Married people. All dancing together. It’s like a Star Trek convention, they’re so into it.”

These instructors understand what many noninitiates don’t: that Zumba® is not some organic cultural import like salsa or yoga but rather a U.S. company with a multifaceted business model and an aggressive growth strategy. Based in an upscale shopping mall in Hallandale, Florida, Zumba Fitness has 250 employees and a reported valuation of more than $500 million. (The company does not release revenue figures. CEO Alberto Perlman says it grew 4,000 percent from 2007 to 2010 and 750 percent in the past three years.) More than a decade after its launch, the business–co-founded by Perlman, Perez, and a third Alberto, that one surnamed Aghion–is suddenly ubiquitous. Seventy thousand locations in the United States–including roughly 95 percent of major gym chains–offer its programs. TV characters toss off references. Classes take place in the Pentagon.

Another thing outsiders don’t realize about Zumba® is its breadth. Yes, this is a fitness company. But it is also becoming an influential player in the music world, strikingdeals with such artists as Wyclef Jean and Pitbull to promote their songs in its classes and feature them on its CD compilations. In June, Billboard hailed Zumba® as the next major music platform. A creator as well as a distributor, the company has commissioned and produced close to 400 songs; the 60 tracks available on iTunes have been downloaded a million times. “It’s hotter than MTV in any of the hot years I saw MTV,” says William Roedy, the former chairman and CEO of MTV Networks International, who is an informal adviser to Zumba®. “They have this perfect synergy with music that is great for the whole industry.”

And watch out, Lululemon: Zumba has a thriving workout apparel line as well and expects to sell 3.5 million units in 2012. The Zumba store at this convention occupies 30,000 square feet. Half an hour before it opens on the first day, more than 600 instructors are already in line, including a couple of white-haired seniors camped out on folding chairs. In the women’s restrooms, I see attendees slicing the shoulders off their new shirts (fans have plastered YouTube with videos demonstrating how to customize Zumba apparel). The stalls are littered with tags left by people who couldn’t wait to get back to their rooms to don their new togs.

Other offerings include video games, DVDs, and fitness concerts at which thousands of dancers perform choreographed moves to live music. But Zumba’s® core products are also its core customers: the instructors themselves. Zumba® doesn’t make money by helping people get fit. It makes money by preparing people for a trade–by licensing and supporting the folks who teach Zumba® classes. Some of those instructors teach part time for fun and extra cash; others find jobs with gyms; and still others start businesses. Although the Zumba® economy isn’t big enough to ding the unemployment rate, it has created many thousands of jobs beyond its walls. “This is all about the instructors,” says Perlman. “Everything we do is to drive people to their classes, so they can be successful.”

Read More at http://www.inc.com/magazine/201212/leigh-buchanan/zumba-fitness-company-of-the-year-2012.html