In 2020, one brand became the undisputed poster child of lockdown fitness: Peloton.
Bike and treadmill sales exploded, celebrities were spotted on them and waitlists stretched for months. The brand felt culturally unstoppable. While gyms struggled to retain clients, Peloton’s kept climbing. In December 2020, it hit peak intraday share prices of $167. By 2021, its revenue was $4.2 billion.
But that level of success didn’t last.
THEY FOCUSSED ON THE WRONG THING
Peloton believed the hardware was the product. They planned for demand to last, scaling manufacturing aggressively and taking on debt to do so. They positioned themselves as a fitness equipment company. It was a bet on a future that was already ending.
When gyms re-opened the brand was left exposed. Loyal users returned to the gym, a backlog in deliveries disgruntled new customers and product recalls meant their reputation was about to hit the headlines again, for all the wrong reasons.
In April 2021 they had to recall all of their treadmill products following a series of accidents that resulted in multiple injuries and one known death.
Then a storyline in the Sex and The city reboot ‘Just Like That’ went viral, when the character Mr Big had a heart attack after completing his 1000th Peloton ride. It’s the kind of cultural moment the brand didn’t need to be a part of.
Then the co-founder and CEO departed, leaving the rumour mill to open up and keep the brand well and truly in the limelight. For Peloton, every crisis hit a brand that had no deeper narrative to fall back on.
THE IDENTITY SHIFT THAT NO-ONE SAW COMING
In 2022, Peloton announced new CEO, Barry McCarthy, a former Spotify and Netflix executive who focussed on restructuring the business, with sources saying that he cut over $800 million in annual costs and reduced staff headcount by roughly 20%. A savage move to save a brand from the brink.
McCarthy focussed on diversifying their business model and revenue streams.
His first move was launching ‘One Peloton’, a rental service where customers could rent bikes for a monthly fee, in order to diversify their business model and revenue stream.
He also helped the brand shift its identity from a ‘stationary bike company’ to a ‘fitness platform for everyone’, using their instructors as the brand’s primary ambassadors and influencers.
IT WASN’T BOUT BIKES. IT WAS ABOUT COMMUNITY
In 2022, Peloton launched the ‘Motivation That Moves You’ campaign, featuring two of their prominent instructors. By 2023 they’d also started to focus on non-cycling content, such as strength and yoga, to broaden appeal for those without equipment.
In 2024, it took its classes to TikTok, giving users access to #TikTokFitness Powered by Peloton in a special hub on their app. Peloton gave users access to short-form classes, live sessions and collaborations between instructors and content creators, in an attempt to bring new users in.
The community that Peloton built was always the real asset, they just hadn’t realised it. They have one of the most engaged fitness communities ever built. Their instructors are like celebrities. The leaderboards, challenges and group rides naturally build community and that community naturally builds loyalty to each other and the instructors.
THE REAL LESSON
Despite this, Peloton’s stock price dropped by 90% during his tenure. In 2024 McCarthy made the decision to step down into a strategic advisory role while the brand was left searching for a new leader to focus on growth.
By January 1st 2025, a new CEO was found in the co-founder of Apple Fitness+, Peter Stern.
The brand is still recovering, yet is still at the forefront of everyone’s mind when they think about connected fitness. Other brands would spend millions to build the community that Peloton has.
And that’s the lesson I want to drive home.
Peloton spent years telling the wrong story; hardware company, premium equipment, pandemic fitness.
The real story; community, belonging, consistency and transformation, was sitting there all along, yet they barely spoke about it publicly. It was seen as a value-add-on, a consequence of the equipment, not the driving force of the brand.
The brands and business owners who build lasting authority aren’t the ones with the best product. They’re the ones who understand what they actually mean to their audience and communicate it relentlessly.
Peloton didn’t lose because the product failed. They lost because they were telling the wrong story from the start. The community was always the product, they just didn’t realise it.
If you’re wondering whether your business is telling the right story to the right people, that’s exactly the conversation I have with clients before we do anything else.
Send me an email (laura@prwithperkes.com) to find out
