Peloton Rides a Wave of Controversy into the Holidays

It’s been a tough month for the D2C Brand Peloton, the fitness company that sells their flagship exercise bike and subscription to live and on-demand classes – or has it?

FULL DISCLOSURE: This writer (me) owns a Peloton bike, and I love it! However I'll try to put my bias aside for the sake of the data...did I mention I LOVE IT!?

Let’s start with the good ol’ days…remember those? After launching the company in 2012, Peloton announced its IPO on September 9th, 2019 along with a prospectus that stated the company, “sells happiness,” according to TechCrunch.  Though we’re unsure of the metric they use for their happiness rating, we can measure their digital spend and insights into their strategy -- because, digital spend and insights makes US happy!

A Full (Spend) Cycle Around the Sun

If we take a look at a full year of Peloton’s spend cycle, dating back to last November 2018, the first thing that catches our eye are the spend spikes, one starting in December of 2018 and peaking in mid-February, as well as another peaking in June. Like most exercise companies, it looks like Peloton begins to ramp up its digital advertising as it gets closer to the holidays, with its largest spend of the year, at just over $13MM across all platforms, 76% of which is dedicated to Facebook. Similarly, (data gathered pre-holiday), we can see their spend trending upwards once again in November of 2019, on the heels of the new holiday season. It’s a tried and true strategy, going after those pre-New Year’s resolutions to get in better shape, as well as family members searching for that perfect holiday gift.

Although spending only a quarter of their holiday spike, Peloton still manages $3.5MM leading up to summer, targeting the summer beach body hopefuls ready to flex those 6-pack abs and bicycle calves in the sand.

And, we’ll be honest, it’s hard to ignore Peloton’s creatives, showing fit riders in sleek peloton shoes, peddling away to their own personal training sessions, and high-octane videos showcasing in-studio rides and metrics to track your progress. And who can argue with their tagline: $0 Down. 0% Financing. 0 Excuses. Add to that, a once-a-year holiday deal, where riders get their full accessory package for free with bike purchase, AND a free 1-month, no obligation home trial. All we can say is, sign us up!

Making Good Impressions?

But alas, the good times can’t last forever. Sparking a backlash with one of their holiday ads, Peloton’s name has been spread all across the news in the last 3 months. The ad, first seen on November 5th, began showing up in articles in early December, lambasting the company. However, as they say, bad press is still press.

Looking at Pathmatics Explorer we can see daily impressions steadily rose, peaking that same time the controversial ad was pushed into the limelight, in early December through mid-month. That’s a lot of eyes looking at the exercise startup at the perfect time to purchase a sleek spin bike. Controversial or not, it got people talking, including staunch defenders of the ad in Peloton forums across the internet.

Competition Can Barely Keep Up

Seemingly undeterred, Peloton has been laying waste to its competition in the last 2 months, in both, number of creatives released, as well as spend share, advertising on EVERY top site. Compared to its top competition, NordicTrack, Echelon Fitness, and Flywheel Sports, Pathmatics Explorer has logged 624 creatives for Peloton since the beginning of November – when they released the ad that will live in infamy - well outpacing the 454 from NordicTrack and simply riding over the remaining competition with 12 and 2 creatives, respectively. Seems like Echelon and Flywheel have an uphill climb if they want to compete this holiday season. 

Interestingly enough, Peloton has chosen not to pull the controversial ad, as with the publishing of this post, it’s still running online. All in all, it hasn’t seemed to hurt Peloton’s bottom line, as they’re up more than 110% in revenue this fiscal year, according to Crunchbase. And with the release of their new treadmill, and more than 1.4 million subscribers to the Peloton app, it seems Peloton isn’t primed for a cool-down anytime soon.