Peloton Reducing Workforce and Emphasizing Members' Comprehensive Wellness Experience
Peloton, the premium fitness brand known for its exercise bikes, treadmills, and rowing machines, is expanding its horizons beyond traditional cardio exercise. The new strategy, spearheaded by the company's new CEO, Peter Stern, aims to encompass general health and wellness, focusing on areas such as strength, sleep, recovery, and holistic wellness engagement.
Stern, who joined Peloton earlier this year after leading services teams at Ford and Apple, discussed these expansions and strategies during a call with investors on Wednesday. He emphasized Peloton's intention to support Members' entire wellness journey.
Retail Expansion and Partnerships
Peloton plans to increase its retail footprint by opening more microstores (from 1 to 10) and forging greater third-party retail partnerships. This move is aimed at providing greater consumer access to Peloton's fitness hardware.
Commercial Partnerships
The company also aims to develop a unified business unit integrating Precor operations, software, and coaching. This unit will cater to commercial customers such as gym operators, hotels, residential buildings, and campuses.
Localized International Experiences
Peloton is working on offering localized international experiences that incorporate native instruction, AI dubbing, and flexible music licensing. This initiative is designed to broaden Peloton's appeal globally.
Long-term Member Engagement and Retention
To foster long-term member engagement and retention, Peloton is focusing on deepening member relationships. This includes gamified onboarding, tailored support for motivational dips, and a new social “Teams” feature within the Peloton app. The company plans to expand this feature with more social tools and more involvement from instructors to create a supportive community and improve accountability.
AI-Powered Personalized Coaching
Peloton is signalling a move towards more customized wellness programming with plans to introduce AI-powered personalized coaching. This could potentially link the platform to users' personal health tracking devices for more personalized insights, action plans, and recommendations.
Scaling the "Peloton Repowered" Program
The company also plans to scale its “Peloton Repowered” refurbished equipment program nationwide. This initiative aims to increase sustainability and affordability.
While Peloton did not announce any new product categories outside of their current connected fitness devices and software, the emphasis on strength training, sleep, and recovery suggests development or enhancement of related content, services, or tech solutions to support those areas as part of their holistic wellness vision.
Stern also mentioned the possibility of more personalized training programs, new meditation and sleep features, and content focused on nutrition.
As Peloton expects its sales to fall even further this year, the company plans to cut approximately 6% of its workforce to save costs and turn the company around. This decision follows a previous layoff of 15% of the workforce in May 2024 when Peloton got rid of its previous CEO.
Peloton's stock has dropped 95% from its early 2021 peak of nearly $170 a share to around $7 today. Despite swinging a profit in the most recent quarter, Peloton reported that its sales dropped 6%.
Despite the challenges, Peloton's new focus on general health and wellness could position the company for a comeback, leveraging AI, retail expansion, commercial partnerships, localized global offerings, social engagement, and a focus on strength, sleep, and recovery.
- Peter Stern, the new CEO of Peloton, discussed the company's expansion into general health and wellness during a call with investors, emphasizing Peloton's intention to support Members' entire wellness journey.
- Peloton plans to increase its retail footprint by opening more microstores and forging greater third-party retail partnerships, aiming to provide greater consumer access to Peloton's fitness hardware.
- To foster long-term member engagement and retention, Peloton is focusing on deepening member relationships with gamified onboarding, tailored support for motivational dips, and a new social “Teams” feature within the Peloton app.
- Peloton is working on offering localized international experiences, incorporating native instruction, AI dubbing, and flexible music licensing, to broaden Peloton's appeal globally.
- Peloton is signalling a move towards more customized wellness programming with plans to introduce AI-powered personalized coaching, potentially linking the platform to users' personal health tracking devices for more personalized insights, action plans, and recommendations.
