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Peloton Interactive, Inc.Louisiana State University Shreveport, Marketing 701January 25, 2020
Business ModelPeloton Interactive, Inc. (Peloton) was founded in 2012, for the sole purpose of creatingstate-of-the-art indoor fitness equipment.In 2014, the company introduced the Peloton Bike, aspin bike, and in 2018, introduced the Peloton Tread, a treadmill.Peloton’s business to customersales are through the internet and the eighty-one (81) global showrooms where its products canbe tested by potential customers.What places Peloton’s products above its competitors is thefitness subscription services and virtual community the customers can interact with whileexercising. Peloton has partnered with third-party companies to deliver and assemble theirproducts. (Peloton, 2020).Competitive AdvantagesAdvantages over Other Fitness Product VendorsPeloton holds the competitive advantage over other fitness product vendors with theirsubscription services and instructors.Subscription services.According to Peloton’sUnited States Securities and ExchangeCommission Report, Form S-1, filed of August 27, 2019, Peloton’s subscription services basegrew in the fiscal year of 2019 by 108% (2019, p. 2) and has a “12 month Connected FitnessSubscriber retention rate of 95% across all fiscal year cohorts since fiscal year 2016” (2019, p.5).This sustainability gives Peloton the advantage over its direct competitors such asNordicTrack, Echelon, and Flywheel in the area of subscription services.Peloton’s competitors offer similar live and on-demand subscription services likePeloton, but each has its own variation of classes.NordicTrack’s subscription services includeda variety of different on-demand class types beyond the studio workout, such as, road races,google maps, trainer led mountain path, trails and scenic rides.The studio workouts are led byinstructors who motivate and challenge the rider; however, the workouts lack the high energymusic (Maybe•yes•no, 2019).Echelon subscription services includes both live and on-demandstudio workouts, but for an additional annual cost, members can subscribe to the FitPass.Thisadditional subscription offers more trainer lead classes such as yoga, stretching, pre-and-postworkout sessions, meditation, Pilates, kickboxing, Zumba and more.In the blog,Peloton vs.Echelon Connect: Comparing Luxury to Economy, a few of the negatives were the less entensivelive training programs, and the program workouts were outdated (2020).Flywheel offers liveand on-demand high-intensity interval traning (HIIT) style spin classes; as well as, Power,Tempo, FlyBarre, FlyFit, and FlyRecover. All offering a variation of intensity to a traditionalspin class with strength, weights, stretching, and a foam rolling program (Flywheel Home BikeReview, 2020).Peloton’s subscription services are accessible through Peloton’s Connected Fitness Appon the 22” inch screen mounted on the equipment.Peloton offers live and on-demand spinclasses instructed by elite fitness trainers.Peloton holds the advantage with its competitivemonthly subscription cost, see Table 1,

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Term
Fall
Professor
Dr. Karen
Tags
Subscription business model, Exercise equipment, Unsubscribe, Peloton, Peloton Interactive

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