Through The Looking Glass & Peloton
How do you grow an at-home fitness equipment brand to a $24 billion dollar company? You make it sexy.
Let’s take a look at how stationary bike giant Peloton wooed the masses and turned thousands over to the spin side.
A little background if you weren’t sure who we were referencing (maybe this Christmas ad will refresh your memory?) — Peloton is an exercise and media company that primarily rakes in dough through products like its indoor cycle. It showcases a touchscreen monitor and treadmill that enable customers to remotely participate in group classes through its boutique studio.
Although it was founded in 2012, Peloton didn’t become a household name until quite recently with its IPO & pandemic popularity. #quarantinelife
In an industry previously considered to be boring, Peloton’s chic fitness equipment, combined with its award-winning content library and marketing, prove that a bike can be another status symbol worth showing off.
In the early days of Peloton, co-founder John Foley spent years pitching the idea to thousands of investors. Though he was quite unsuccessful then, the idea took off once customers experienced riding Peloton bikes themselves in a class scenario.
Today, Peloton continues to employ a successful direct-to-consumer strategy along with really good branding. The company currently has over 5.4 million members in their community, and boasts a 92% 12-month retention rate.
Let’s take a look at the spin master’s strategy:
Word of Mouth
Referral marketing is gold. Companies like Peloton incur high marketing costs in the beginning to cement customer loyalty, retention and word-of-mouth referrals. The marketing pays off in the end, even if the company has to take a loss for a couple of years — eventually, their customer acquisition cost (CAC) goes down. Peloton proudly touts a 94 NPS score and has a “big hairy audacious goal” to grow that to 100, along with 100MM subscribers.
Omnichannel Experience
Omnichannel experience basically means meeting customers through multiple channels and platforms, which Peloton does successfully with its app, social media presence and integrations. You don’t even need the actual $2000 bike to benefit from this as you can still use their robust content library to practice yoga, meditation, cardio & even barre from the comfort of your own home. By doing this, Peloton is able to increase their customer base and outreach efforts.
Community First
Peloton prides themselves on their instructors and members. There’s a reason they’re able to garner such a cult-like following today. By gamifying the workout experience through leaderboards, virtual high-fives and even different groups to join such as #BlackGirlMagic and #Vets, they create a family-like feel that you can enjoy being part of. The instructors themselves have massive social media followings, which you may encounter while scrolling through Instagram on your afternoon break, and come from a variety of backgrounds, marking the company’s commitment to diversity and inclusion. Peloton listens to their customers’ needs, and follows through accordingly.
Content is King
With thousands of videos and workouts to join in on, there’s never a dull moment with the Peloton subscription service. The company started off not knowing anything about video production with 4 bikes in the back room of their office — scrappy startup style — and now boasts a serious film studio which pumps out hundreds of programs a month. Despite hailing as a fitness equipment company, service is their most valuable asset.
Have you taken note of what you can apply to your own startup?
It’s safe to say that Peloton has gotten ahead of the race. Instead of tanking during 2020, it proved to be the company’s best year yet because of at-home fitness trends. With gyms shut down, there’s only so much pizza you can eat before wanting to sweat it out.
Peloton positioned itself perfectly to be the remote workout winner, with years of hard work laying a solid foundation it continues to build upon.
Understanding their customers’ lifestyle and behavior allowed them to tailor content and marketing strategy, reminding us to devise a product or service with our target audience in mind.
Speaking of, if you’re bored and want to peruse their internal branding deck in 2019, take a look here.
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