I said that exact same thing, and passed on an offer from them- 4 years ago. I am not exactly kicking myself- at the time I was not an exercise bike enthusiast, and my few trips to Soul Cycle with my wife really turned me off- and regardless, I ended up landing a more lucrative role, even factoring in what stock grants would have been worth. About a year and a half ago, the wife bought a Peloton, and I rolled my eyes about our new expensive coat hanger, and I am currently on a 42 week streak.
I don't think you can pass this off as a fad- Soul Cycle first hit the scene around 2009, its still around- and they have just released a bike and service as well. Other look alikes have come on the market as well- Tonal and Mirror being the biggest. This is looking less like a fad and more like they were the leading edge of a smart exercise equipment industry.
Sure the specific piece of equipment that is in vogue might come and go, but I think Peloton is here to stay. This doesn't mean that gyms are going to close in the long run, but workout equipment as a service is a class of product that I feel is with us for the long haul.
Its success was mostly due to its novelty and exclusivity. After a while, copycats and their push for growth did them in.
Peloton is the same. They are first to market and have cultivated a level of exclusivity, but there is nothing unique about them that other businesses can’t copy over time (it’s already happening — most exercise companies now have their own Peloclones).
Interestingly, I have something of an inside view on this- my wife was one of the early enthusiasts, and I guess you could accuse her of being one of the "cliques" discussed- I have been to an instructor's house, a friend of ours is a publicist of sorts for someone prominently mentioned in the article, she will be in the wedding of someone she met at Soul that used to work the front desk (and I guess not coincidentally loves bright red lipstick) and would frequently have her bike moved to the front row.
She used to spend a jaw dropping amount on Soul- it was her favorite activity to take her clients to. Around the time they IPO'ed, she felt a change- the expansion took her favorite instructors out of her favorite studios, and often even out of the area as they helped open up locations in LA, Miami, etc. The new ones never had quite the same magnetism- which is of course subjective- most people have their personal favorites, and while there was some overlap, this could differ substantially from person to person. They used to give gifts to their top riders at the end of the year in the form of free classes, that went away, replaced with "charitable donations" and eventually just dropped altogether. Top instructors tried to branch out on their own, some successful, some not, but the point being is that really it was over expansion and IMHO brand dilution, which I guess you could call exclusivity (though I personally feel its a bit different than just exclusivity) that really sent them into a downward trajectory. She went from taking 4-5 classes a week, to mixing in Cycle Bar and other studios, to finally in October 2019 just deciding to get a Peloton.
All that said, they still had 1.62 million rides in 2019... which while down from ~1.8, that's not exactly a fad or a dead business- I actually thought their drop would be far bigger to be honest. Personally though I feel this was less of an effect of a fad, than the more typical story of the bean counters moving in and pursuing growth and next quarter's numbers at the cost of the quality of the brand.
To be honest that article was quite eye opening- I guess what I thought was a unique experience and fandom by my wife was something that the culture carefully cultivated.
Genuinely curious as to what would have to be different for it _not_ to be considered a fad? Seeing as they have been going for 8 years and, and, after having a quick look, have been doubling revenue for a number of years previous to Covid19.
You can ridicule fads, but I think it's interesting. I know people will pay a reasonable price for a product they might not even need, but an unreasonable price? How the hell does that happen?
When they’re trapped in their homes, gyms are closed, and they have disposable income from not being allowed to travel, the range of “reasonable price” expands quite a bit.
it's a spin class you can do from home. Plenty of people already pay high prices for spin classes, and it adds the convenience of being able to participate from home. It makes sense that it would be popular, especially among the middle class demographic spin classes are usually aimed at.
Is it unreasonable? My wife bought the Peloton bike for us 4 years ago. What were they, $2k? I think the first year's subscription was free, and now she pays whatever the monthly fee is. $40, I think, right?
Why's that unreasonable? When I was trying to get back into shape and add some strength training, I started seeing a personal trainer, which I honestly, probably stuck with for too long. Given per-session costs, it was costing me upwards of $500/mo. Of course that includes use of gym facilities and 1:1 training and advice. Probably one of the best things I ever did.
Basic gym memberships have gotta be at least $100/mo. I'm sure there are countless people paying $200/mo and up. Obviously you get access to a lot more equipment, but you have to go there, too.
I just don't see $40/month as a lot. Maybe I'm strange.
Since then, my wife also added a Peloton treadmill to the mix, which is over 4k. It uses the same subscription. As do the Yoga and stretching and bodyweight strength classes.. and meditation if you're into that. Both of us, 2 pieces of equipment, unlimited classes, on your phone, appletv, whatever. $40/mo.
On the average evening we've got the treadmill and bike going at the same time and when she finishes with her run she's doing stretching and core stuff in the living room while I do more on the bike. The subscription starts to sound like a pretty good deal. But don't tell them that, because we're locked in thanks to the hardware :)
The demographics for these kind of products is very different. It's either those who do have enough money not to care about the cost or the so called aspiring ones: who don't have money but want to fit in or relate to the better off groups. It reminds me when the latest Iphone came out( the most expensive version). Guess who bought it? Our CEO and a member of my team,who was probably on the lowest salary in the company. Peloten is no different to this.
I've actually found most CEOs I know have beat to crap old smartphones.
I tend to look down on the classist assignment of folks' motivations for buying things. It's almost always projection. How many years did we have to hear about the "status symbol" of a starbucks cup? If only $2 for a cup of black coffee could buy you status, right?
Fads (at all price classes) are interesting. There are definitely products/activities that become very popular for a time and then just sort of fade out for no discernible reason.
One good example is in-line skating/rollerblading. It was a very popular activity--at least in urban areas--a number of years back and it just sort of petered out. You rarely see someone skating these days.
Skating/rollerblading is coming back into style, at least here in coastal California. Everything old is new again, and everything new becomes old at some point.
Will it be around in 20 years? Probably not. Does that make it a fad? I don't know. I've had one for 4 years and I'll certainly be riding it for another 4. That's good enough for me. I tend to be allergic to fads and trends, but as long as one is happy with what they get for the price paid, what's the problem?
Comments
Peloton is a fad and will be dropped for the next exercise fad in 2-5 years, just like SoulCycle was. For now, they are feasting.
I said that exact same thing, and passed on an offer from them- 4 years ago. I am not exactly kicking myself- at the time I was not an exercise bike enthusiast, and my few trips to Soul Cycle with my wife really turned me off- and regardless, I ended up landing a more lucrative role, even factoring in what stock grants would have been worth. About a year and a half ago, the wife bought a Peloton, and I rolled my eyes about our new expensive coat hanger, and I am currently on a 42 week streak.
I don't think you can pass this off as a fad- Soul Cycle first hit the scene around 2009, its still around- and they have just released a bike and service as well. Other look alikes have come on the market as well- Tonal and Mirror being the biggest. This is looking less like a fad and more like they were the leading edge of a smart exercise equipment industry.
Sure the specific piece of equipment that is in vogue might come and go, but I think Peloton is here to stay. This doesn't mean that gyms are going to close in the long run, but workout equipment as a service is a class of product that I feel is with us for the long haul.
SoulCycle basically collapsed and is just starting to come back from the brink: https://www.vox.com/the-goods/22195549/soulcycle-decline-reo...
Its success was mostly due to its novelty and exclusivity. After a while, copycats and their push for growth did them in.
Peloton is the same. They are first to market and have cultivated a level of exclusivity, but there is nothing unique about them that other businesses can’t copy over time (it’s already happening — most exercise companies now have their own Peloclones).
Interestingly, I have something of an inside view on this- my wife was one of the early enthusiasts, and I guess you could accuse her of being one of the "cliques" discussed- I have been to an instructor's house, a friend of ours is a publicist of sorts for someone prominently mentioned in the article, she will be in the wedding of someone she met at Soul that used to work the front desk (and I guess not coincidentally loves bright red lipstick) and would frequently have her bike moved to the front row.
She used to spend a jaw dropping amount on Soul- it was her favorite activity to take her clients to. Around the time they IPO'ed, she felt a change- the expansion took her favorite instructors out of her favorite studios, and often even out of the area as they helped open up locations in LA, Miami, etc. The new ones never had quite the same magnetism- which is of course subjective- most people have their personal favorites, and while there was some overlap, this could differ substantially from person to person. They used to give gifts to their top riders at the end of the year in the form of free classes, that went away, replaced with "charitable donations" and eventually just dropped altogether. Top instructors tried to branch out on their own, some successful, some not, but the point being is that really it was over expansion and IMHO brand dilution, which I guess you could call exclusivity (though I personally feel its a bit different than just exclusivity) that really sent them into a downward trajectory. She went from taking 4-5 classes a week, to mixing in Cycle Bar and other studios, to finally in October 2019 just deciding to get a Peloton.
All that said, they still had 1.62 million rides in 2019... which while down from ~1.8, that's not exactly a fad or a dead business- I actually thought their drop would be far bigger to be honest. Personally though I feel this was less of an effect of a fad, than the more typical story of the bean counters moving in and pursuing growth and next quarter's numbers at the cost of the quality of the brand.
To be honest that article was quite eye opening- I guess what I thought was a unique experience and fandom by my wife was something that the culture carefully cultivated.
Genuinely curious as to what would have to be different for it _not_ to be considered a fad? Seeing as they have been going for 8 years and, and, after having a quick look, have been doubling revenue for a number of years previous to Covid19.
You can ridicule fads, but I think it's interesting. I know people will pay a reasonable price for a product they might not even need, but an unreasonable price? How the hell does that happen?
When they’re trapped in their homes, gyms are closed, and they have disposable income from not being allowed to travel, the range of “reasonable price” expands quite a bit.
Good point. But the company was doing quite well before the pandemic, no?
it's a spin class you can do from home. Plenty of people already pay high prices for spin classes, and it adds the convenience of being able to participate from home. It makes sense that it would be popular, especially among the middle class demographic spin classes are usually aimed at.
Is it unreasonable? My wife bought the Peloton bike for us 4 years ago. What were they, $2k? I think the first year's subscription was free, and now she pays whatever the monthly fee is. $40, I think, right?
Why's that unreasonable? When I was trying to get back into shape and add some strength training, I started seeing a personal trainer, which I honestly, probably stuck with for too long. Given per-session costs, it was costing me upwards of $500/mo. Of course that includes use of gym facilities and 1:1 training and advice. Probably one of the best things I ever did.
Basic gym memberships have gotta be at least $100/mo. I'm sure there are countless people paying $200/mo and up. Obviously you get access to a lot more equipment, but you have to go there, too.
I just don't see $40/month as a lot. Maybe I'm strange.
Since then, my wife also added a Peloton treadmill to the mix, which is over 4k. It uses the same subscription. As do the Yoga and stretching and bodyweight strength classes.. and meditation if you're into that. Both of us, 2 pieces of equipment, unlimited classes, on your phone, appletv, whatever. $40/mo.
On the average evening we've got the treadmill and bike going at the same time and when she finishes with her run she's doing stretching and core stuff in the living room while I do more on the bike. The subscription starts to sound like a pretty good deal. But don't tell them that, because we're locked in thanks to the hardware :)
The demographics for these kind of products is very different. It's either those who do have enough money not to care about the cost or the so called aspiring ones: who don't have money but want to fit in or relate to the better off groups. It reminds me when the latest Iphone came out( the most expensive version). Guess who bought it? Our CEO and a member of my team,who was probably on the lowest salary in the company. Peloten is no different to this.
I've actually found most CEOs I know have beat to crap old smartphones.
I tend to look down on the classist assignment of folks' motivations for buying things. It's almost always projection. How many years did we have to hear about the "status symbol" of a starbucks cup? If only $2 for a cup of black coffee could buy you status, right?
This is generally what I notice also. Seems to be less about riding the actual bike and more about telling people you have a Peleton.
Fads (at all price classes) are interesting. There are definitely products/activities that become very popular for a time and then just sort of fade out for no discernible reason.
One good example is in-line skating/rollerblading. It was a very popular activity--at least in urban areas--a number of years back and it just sort of petered out. You rarely see someone skating these days.
Skating/rollerblading is coming back into style, at least here in coastal California. Everything old is new again, and everything new becomes old at some point.
If you were already spending >$200/mo on spin classes, the price of a peloton is very reasonable as an alternative.
Will it be around in 20 years? Probably not. Does that make it a fad? I don't know. I've had one for 4 years and I'll certainly be riding it for another 4. That's good enough for me. I tend to be allergic to fads and trends, but as long as one is happy with what they get for the price paid, what's the problem?