‘Peloton Wife’ helped spur holiday sales for the fitness brand

peloton wife helped spur holiday sales for the fitness brand

It was the gift that kept on giving. Peloton’s widely panned holiday ad campaign, called “The Gift That Gives Back,” might have helped juice sales after all. The New York-based fitness brand reported stellar second-quarter earnings on Wednesday.

Revenue rose 77 percent over the year-earlier period to $466.3 million, while the number of connected fitness subscribers, who pay to stream classes, grew 96 percent to more than 712,000. Peloton counts 2 million members in total.

However, the brand was not profitable for the quarter—it reported a net loss of $55.4 million. In addition, Peloton’s stock was trending down in evening trading as Peloton issued a third-quarter forecast that was lower than expected by investors. The company went public late last year with an initial price of $29 a share.

In a letter to investors, Peloton cited the strength of its home-trial, where users can take 30 days to try merchandise, as a big driver of sales. Executives also cited the “holiday bike campaign” as reaching a “wide audience of potential buyers.”

On a call with analysts, Peloton Chief Financial Officer Jill Woodworth said the “strong holiday was driven by our largest omni-channel marketing program to date.” In the quarter, Peloton reported a 61 percent rise in sales and marketing expenses to $160.5 million.

The anthem commercial, which Peloton debuted in early December as part of its holiday campaign, showcased a wide-eyed, slender woman keeping a video diary of her Peloton journey for her husband, who gave her the bike. Critics said the woman was already quite trim, and that her husband should not expect her to be more so. One expert even called the spot a “male fantasy ad” designed for men to get “skinnier spouses.”

But Peloton disputed such complaints, noting that it had received positive feedback from members about the campaign, which was created by ad agency Mekanism. Indeed, the brand enjoys a cult following of fans, which includes David Kepron, the VP of global design strategies for premium distinctive brands at Marriott International. Kepron admittedly gushed about Peloton while interviewing a senior VP from the exercise brand on stage at the recent National Retail Federation annual Big Show conference about connecting with consumers. He did not ask about the controversial commercial.

The “Gift” spot was also a gift for Monica Ruiz, the actress who starred in the commercial—she later starred in a gin ad that poked fun at the hoopla surrounding her one-time turn as the “Peloton Wife.”

Earlier this week, Peloton said it had won its patent fight against competitor Flywheel, which had a similar product to Peloton’s patented offerings. As part of the settlement, Flywheel agreed to stop using the technology in question for its Fly Anywhere home bikes.

“This result reinforces the strength of our patent portfolio and reaffirms our lead as an innovation company operating at the intersection of fitness, technology and content,” said Hisao Kushi, chief legal officer and co-founder of Peloton, in a statement.

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