May 30, 2023
When Peloton unveiled its 2019 holiday commercial—depicting a husband who gifted his wife a stationary bike for Christmas—the ad was widely panned as sexist, dystopian, and reminiscent of a hostage video, reports CNBC
People took umbrage at the commercial’s characters—a white, upper-middle-class family—and said it sent a range of dangerous messages about everything from gender norms to body dysmorphia.
While the controversy eventually faded from the headlines, the public remembered. The ad solidified Peloton’s nascent identity as a high-end bike company reserved for a certain type of person at a certain income level. Now, the company is ready to change that perception.
On Tuesday, May 30, Peloton is launching a new marketing campaign that bills the retailer as a company for anyone, regardless of age, fitness level and income—or whether they shelled out thousands for a pricey piece of equipment.
The brand relaunch comes a little over a year into Barry McCarthy’s tenure as CEO. He has worked to transform Peloton from a hardware-focused company into one that’s just as invested in its app and the high-margin subscription revenue that it brings.
It has worked to rein in its gargantuan costs, remedy recalls and find new revenue streams as demand for its connected fitness products slowed and consumers became more cautious about their discretionary spending.
While the company has yet to return to profitability, it has managed to stop the bleeding. With a new marketing chief at the helm, Peloton says it’s ready to reintroduce itself to the world and shed the image the holiday ad seared into some minds.
It has unveiled a new marketing strategy designed to capture a new customer base. ″[We’re] now leaning in for the first time to the idea that OK, not everyone is going to bring premium Peloton hardware into their home,” Tom Cortese, Peloton’s co-founder and chief product officer, told CNBC.
“We know that the perception externally does not match the reality of who we are,” Peloton’s Chief Marketing Officer Leslie Berland, who started with the company in January and led the relaunch, told CNBC in an interview. “This company historically has been thought of as an in-home bike company for fitness enthusiasts but over the years, it has evolved into something that is much more bigger, much broader than that.”
The content people will have access to varies by the level and, in some cases; legacy users will have less access come December, when a grace period ends. Currently, people who pay $12.99 a month to use the Peloton app can do a bike class every day, but in December, they’ll only be able to do three per month.
Peloton is also saying goodbye to its trademark fire engine red and black colors in favor of a new mix of hues it says better captures the “energy” of a workout and the “afterglow” that comes. New branding materials include shades of purple, pink, green and a lighter red.
In a splashy 90-second marketing video shared with CNBC, Peloton’s app takes center stage. It shows people of all shapes, sizes, fitness abilities and ages using it to take strength and yoga classes at home, but also in gyms, which have long been considered a threat to Peloton’s business.
While Peloton features its Bike, Tread and Row machines in the clip, it does not show the hardware until about 30 seconds into the video.
Peloton insisted the focus on selling subscriptions does not mean it has abandoned its hardware business, and said the company is on a dual track with both.
Briana Deserio, 32, has been a Peloton member since the early days of the pandemic. She said the brand’s competitive and aspirational appeal originally led her to buy a Bike. When briefed about the company’s new marketing strategy, she told CNBC she supports the move and its focus on being inclusive. But she said there’s a chance making Peloton accessible to everyone could dilute its brand.
Berland, Peloton’s new marketing chief, isn’t concerned about the brand losing strength. She said the new marketing strategy reflects what the company already is.
“Our members, our instructors, our classes, our content. That is unchanged. The company has evolved into all of this,” said Berland. “It’s time for the brand and the marketing to represent all of that and all of its vibrancy.”
Research contact: @CNBCnow