Yahoo Finance Peloton unveils major rebrand, with new ‘Gym’ workouts and free options
Peloton is relaunching its app, adding new options for people to use at the gym, and letting people try it out for free.
The major overhaul will come with a new rebrand that is aimed at moving it away from being known primarily for its bike, which is relatively expensive. Instead, the company wants to broaden its focus to allow people to have a variety of ways to use its workouts, representatives told The Independent.
Peloton was launched in 2014, with the first version of its indoor cycling bike with a screen, and a variety of live-streamed classes that allowed them to replicate the experience of an in-person spin class. But it came to much larger prominence in 2020, as lockdowns led people to find new ways of working out at home.
In the months and years since, however, Peloton has been hit by a range of issues, including financial problems that have left it unprofitable and a stock price that has fallen to $7 from a high of $162 during the pandemic. Those troubles have led to a range of changes, including the installation of a new chief executive in Barry McCarthy.
With those changes has come a new focus on encouraging people to think of the company as an app offering as well as a premium fitness brand. The new rebrand will bring the focus towards talking about “how Peloton is for anyone, anytime, anywhere”, representatives said, with the company showing a wide variety of ways of engaging with its offering beyond “just buy[ing] a bike and put[ing] it in your home”.
And the company will relaunch its app, with the inclusion of both a free tier and a Gym offering that will allow people to use its workouts while in commercial gyms or those at their home. The new offering is aimed at appealing to anyone “wherever you are, whatever level you’re at,” said Tom Cortese, Peloton’s co-founder and chief product officer.
“To be able to access the the joy of a Peloton instructor and the Peloton service in all of those locations, I think is just an awesome step forward in an evolution of the Peloton strategy to be able to reach even more people with this system that we've developed,” he told The Independent as the relaunch was revealed.
Most notable among the new tiered offerings is the free version of Peloton, which does not require a credit card and allows people access to rotating set of 50 classes made up of a variety of exercise types. But it also brings with it the “Peloton App One” membership that costs the same as the current digital offering, as well as a higher-priced “Peloton App Plus” tier that gives access to everything, including unlimited equipment-based workouts.
Until now, Peloton has not offered a free membership, though it has allowed people to temporarily trial its premium service without paying. That was partly because Peloton’s reliance on premium music and properly licensing it meant that it was difficult for the company to produce its classes for free, said Brent Tworetzky, Peloton’s vice president of product for its app and e-commerce.
The free option is instead partly based on other offerings that have arrived in the Peloton app, such as new tools to track workouts, keep up with streaks and stay in touch with the community on the app, he said. It also wanted to use the free workout to draw attention to the app, he said, noting that there is “a very low awareness” of that digital offering and that “people think of us especially as a bike company”.
In time, Peloton hopes that users will start with those free classes and then “fall in love with our instructors” so that they upgrade to the more premium tier. But Mr Tworetzky noted that some customers may stay with the free classes forever.
“We think for somebody who uses us a couple of times a week, uses us to supplement their existing workouts or wants to give us a test, we’ve got feedback from those users that this is a great way to get started,” he said. But the app will encourage users to upgrade in a variety of ways, such as restricting those free classes to just one or two classes per instructor, so that they will need to upgrade to get each person’s full library.
The new Peloton Gym offering is also intended as another way for people to engage with Peloton’s offering, said Jen Cotter, Peloton’s chief content officer. Among other aims, it looks to bring in potential customers who might not “know yet that you’d love watching a video and looking at an instructor while listening to music and working out is for you – which we do hear sometimes from people who don’t love Peloton yet”.
Instead, the Gym workouts are akin to walking into a studio and seeing a workout on the wall, with the individual exercises listed as well as help from instructors on how to do them, she said. “You’re getting the trusted expertise of our fitness instructors, but without having to watch it to do it along with them,” she said.
Even as Peloton has brought new focus to its app offering, it has also aimed to make it easier for people to buy the indoor bike that made it famous but also brought some criticism over its pricing and bulk. It has aimed to develop a “fitness as a service” offering in the US, said Mr Cortese, which has included the option to “subscribe” to the bike and not have to make a large payment at the start.
But he noted that some customers may not have the space or the money to buy a bike, and that the new focus on the app would be perfect for those who are unable to commit to such a purchase, such as people in shared apartments that move often and do not want to commit to such a purpose. “I think there are different folks at different points in in their lives with different setups, and this flexibility of being able to come into Peloton at these different points and determine if you're going to use the park as your gym, or your living room as your gym, is an awesome opportunity,” said Mr Cortese.
Many of the company’s existing fanbase do not use the app and are as committed to its now-famous instructors and the brand, said Ms Cotter. “I was surprised that that level of connectivity existed without making such a significant purchase to connect you to our brand,” she said.
Much of Peloton’s success through lockdown came as a result of the closure of gyms, and people’s consequent need for both workouts and fitness hardware for their home. As such, the launch of both a focus on the app and a new offering aimed at the gym could mark a significant change in the way that people see the company.
Mr Tworetzky said the company had more than doubled its investment in the app and that the relaunch was intended in part to show the company’s commitment to it. But its executives also said that it did not see it as being in competition with a more traditional gym offering, and that since the start of the company users were still going to in-person classes alongside doing workouts on Peloton.
