The connected fitness category is putting its back into sustaining the at-home workout rally cheered on during lockdowns, then booed in recent months due to a confluence of factors.
At the center of this story is, of course, Peloton. A lockdown darling whose shares gained a reported 440% throughout 2020, flattened out in mid-2021 and have been deflating ever since.
Business Insider reported in February that “the company fell prey to the ‘bullwhip effect,’ spending big on logistics while expecting that demand would remain high — when demand cooled, Peloton was left with costly supply chain operations that now require a major overhaul.”
Rumors swirled of potential suitors for Peloton earlier this quarter, potentially including Amazon, Apple or Nike. While that future has yet to be written, Peloton is trying to get back in shape.
In February, the company laid out an ambitious realignment including laying off 20% of its 2,800-strong workforce and absorbing $60 million in capital expenditures in its beleaguered hardware unit. Former Spotify and Netflix executive Barry McCarthy came on as CEO as Peloton’s co-founders departed to quell a shareholder rebellion and restore confidence.
From Bonking to Slingshot
Things got peddling again on March 10, as Peloton announced that Andrew Rendich will join as chief supply chain officer effective March 16. In that announcement, McCarthy said, “Andy deeply understands how to run and execute a subscription model business. He has always put the customer first while delivering an excellent experience.”
CNBC reported that on Friday (March 18) Peloton will start trialing a pricing system that lets users pay a single monthly fee for access to on-demand fitness classes and their workout equipment — and give that equipment back if they decide to cancel.
See also: Peloton and the Amazon Effect on Fitness
See also: Peloton Trials New Pricing Model
As stationary bikes hydrate and reassess, it’s looking more like a day at the beach for rowers.
On Thursday (March 17) at-home connected rower Hydrow announced it’s raised $55 million in Series-D funding, showing investor belief in the home fitness category and concepts.
“As more and more people embrace a hybrid approach to fitness, we continue to see extraordinary adoption, and our top priority is ensuring we can keep meeting that demand,” CEO and Founder Bruce Smith said in a statement. “This latest round of funding will not only allow us to do that, but will give us the opportunity to further invest in our product offering and drive innovation, so we can continue to deliver a best-in-class experience for our members.”