America is the fattest country in the OECD. Due to 70% of US adults being overweight, obesity has fuelled $147-210B of healthcare costs associated with preventable chronic diseases. Founded in 2011, Retrofit is a leading private wellness company that drives weight loss for busy professionals. Having raised $16M of equity financing and being 80 employees strong, Retrofit has effectively aligned its operational model to fuel its success in helping people slim down. However, Retrofit must overcome future challenges as the industry continues to shift rapidly.
Retrofit works with self-insured companies to lower obesity-related healthcare costs. As self-insured companies pay for all healthcare costs for their employees, they are highly incentivised to provide for preventative programs that avoid future costs that may be more costly. Compared to healthy employees, obese employees have been found to cost companies an additional $1400 of healthcare costs and $506 of productivity cost. As a result, firms pay Retrofit a set fee per employee on their wellness program, with the promise that companies will break even with healthcare cost savings within 2 years on average.
Retrofit has effectively aligned their operating model with 3 key measures:
- Cross-disciplinary teaming for a holistic solution
- For each individual they work with, Retrofit assigns a team consisting of a program manager, registered dietitian, exercise physiologist and behaviour coach. In alignment with recommendations by the US Preventive Services Task Force, this enables Retrofit to deliver a high-intensity program that tackles weight-loss through diet, exercise and behavioural change simultaneously.
- Technology enabling convenient care at home or at work
- Retrofit delivers all care remotely. 1:1 coaching is done via Skype, notes are shared by email and reminders are done through texts. All content is accessed through computers and mobile apps. Furthermore, the client’s physical activity and weight is automatically tracked through FitBit fitness trackers and a Wi-Fi-connected weighing scale. This not only allows clients to receive care at home or at work, this also enables Retrofit’s coaches to work remotely and on a flex-time basis.
- High-performance culture emphasizing work-life balance
- Retrofit scores highly on employee satisfaction. Due to a focus on recruiting for coaching talent with substantial experience and good cultural fit, Retrofit is also able to grant coaches the flexibility to work remotely from home. Higher employee satisfaction leads to higher loyalty, which has lowered employee turnover and improved the experience of clients who expect a consistent, long-term partnership with familiar coaches.
As a result, Retrofit has been able to deliver good results for its B2B2C partnerships. For example, Yum! Brands, Inc. (running KFC, Pizza Hut & Taco Bell) successfully piloted Retrofit in early 2015 with 195 employees – 95% of the employees losing 12 pounds on average. Retrofit continues to scale its partnership with Yum! Brands and other key companies.
Moving forward, Retrofit faces two key challenges. The US millennial population has shifted rapidly towards using mobile apps, and Retrofit has only just begun investing in mobile-centric design to cater to the younger segment of their clients. Secondly, Retrofit faces increasing competition with players such as Omada Health in serving companies deal with obesity-related healthcare costs. Only time will tell whether Retrofit can keep up with the pace of change.
o Interviews of current employees