At this stage, how do they save Peloton? If I was CEO I’d be thinking: 1. Licensing the OS & Brand to other manufacturers. 2. Open up to external instructors to become the OnlyFans of fitness. 3. Cut EVERYTHING. Come down to sub-500 staff What would your plan be?
Ricky Eckhardt
6mo
First you realize you make bikes and treadmills. You’re not a startup, decacorn, rocket ship. You can’t be. It’s a premium product. You’ve positioned it as such. Riding the fad of COVID was great, but you didn’t build differentiation past a screen. Everyone has a screen. Everyone has courses. The gym is sub > $10mn. Sure you could try to be the OF - but that’s beach body. The best thing you could do is go acquisition heavy. The other manufactures are cheap. Gobble them up. Buy Beach Body, all of AI mirrors and work out in a box, after raising from LVMH. Buy a premium gym apparel line. Then build out a network of events, hype, etc. Buy an event platform like Strava. Cover the market 360 as the lux workout brand while unseating anything else. Then maybe you have something. Lastly, fire the CEO. He ain’t it. He’s 68. No offense, but you going live on your Peloton a lot? Bring in a younger social forward CEO. Peloton is a brand over anything else and the CEO should be that brand image, going live across socials daily to hype the brand. It’s 2024. The CEO on social and their image is everything.
Paul Campbell
6mo
When you say 'save' are they loss making still? Or is their market cap now reflective of their true value? I've not paid attention to their product for a few years. Peloton model is always going to have a limit to subscriptions. Why? Because their marketing suggests you need room for a bike/treadmill to participate. It might not be the reality but that is what their marketing tells you. I'd look at 3 directions. 1. Brand - Peloton have an established name in fitness so start selling more branded product. Focus on high-end performance. Sponsor athletes. Peloton trackers. Buy someone like Withings. 2. Brand Diversity - Health and Lifestyle. So many directions in these complimentary sectors. Supplements are a massive sector and they have a high income audience. 3. Spaces - Buy some gym/health brands and build out the other half of the market. Subscribe and access gyms/health spas as well as home.
Liam Hall
6mo
They should make actual bikes and enter/buy a racing team, try and win the tour de france, build brand partnerships with winning athletes and other leading brands, then people will buy the clothing range.
Start/create a false pandemic so no-one can leave home to go to the gym 🤔
Dan Ware
6mo
Three very sensible suggestions James Personally, in addition, I’d be looking at Partnerships, partnerships, partnerships. Give a fat wedge of equity to a great strategic partner (sportswear manufacturer like Nike /adidas, apple, Microsoft) and leverage their brand equity. Or Partnership with a big gym chain like planet. Give the bikes, running machines and rowing machines for free. Make the money on the monthly licensing? With their 17 million odd members. Add it as an extension to the membership the customers already pay so much more perceived value
Prateek Sanjay
6mo
Human beings are driven for: 1. Survival 2. Dopamine 3. Avoiding pain They are not driven for fitness. Peloton did well during Covid because humans have a tremendous need for connection. NOT fitness. Peloton solved a human connection problem, not a fitness problem. To be a fitness company is pointless. There is no money in fitness. Gyms lock you in for one year because they know this.
Kristian Wilson
6mo
Interesting post James! There is a sustainable company in there somewhere. The current version is not it, I would love to know what they think their Total Adressable Market is, because I bet it’s orders of magnitude out. The biggest problem is that it’s basically an average spin bike with an android tablet attached. There is no real value outside of the branding. Other manufactures (Stages, Wattbike) make better products for gyms (and home). Serious cyclists are served by multiple open platforms (bring your own bike) such as Zwift and even they are struggling. COVID was an outlier for connected fitness/cycling, it should have been been ignored as a datapoint.
Corey Engel 🧢
6mo
The OF of fitness is a bold move. Lot of money in the adult entertainment industry but will it work?
Kelly Davies
6mo
There’s a price problem. I think. I want one. Technically I can afford one. But I cant make the leap through fear of it being a novelty and it feeling very indulgent plus I also want to keep my gym membership and then it’s all adding up and I freeze at making the jump.. I think there are lots of Kellys. Perhaps it’s not a price problem, it’s a persuasion problem.
CEO, Richmond Group
6moOf course, the holy grail would be to sell to Apple. I can’t see how Beats was worth $3Bn, but Peloton isn’t worth $1Bn to Apple. Peloton Bikes and treadmills could enhance Apple’s ecosystem, and integrate deeply with almost every Apple product. Selling through Apple stores is a good fit. Just seems very obvious. But it’s not in Peloton’s power to make that happen. I’m guessing Tim Cook has his reasons.