By Dirk Sorenson, Executive Director, Industry Analyst, Sports, The NPD Group
You might know it from the ad campaigns, or from a co-worker’s over-the-top recommendation.
In thinking about the first of my four eSports pillars making up the “Internet of Fitness,” Peloton is the most prominent example of a product/service that delivers training “media” and allows coaching to stream into our home.
Peloton is basically a stationary bike with a monitor that streams live classes to its members. Essentially, the experience allows a consumer to engage in studio cycling classes at home.
With a global marketing push and new products that expand into running, outside analysts believe that Peloton may be a $3 billion business by 2022, with a potential subscriber base as large as two million globally. What I find tremendously interesting about Peloton is that it’s really a media company. This platform could work as a smart advertising hub to target consumers based on fitness characteristics, demographics, and class interest. Additionally, like a well-formatted e-commerce site, Peloton provides 24-7 engagement, appealing to everyone’s schedules and also to individuals who have little or no interest in stepping into a gym. Both are highly scalable, and both can support “long tail” messaging and commerce.
Given that Peloton households are spending $100 dollars each month on subscription-related expenses to engage in an activity, we can assume that many of these households have the income to invest in sports products. And because these consumers are not necessarily hardcore athletes or fitness junkies, the Peloton platform could be used to sell any number of goods or services. My expectation is that these smart in-home experiences will be leveraged pretty quickly by those manufacturers and forward-thinking retailers to sell athleisure apparel, casual athletic shoes, self-improvement products, and so on.
So where is the downside? What could slow down this experience? Aside from the investment, which is often financed to decrease the initial investment into a system like this, I would argue that Peloton doesn’t offer the accountability and social reward that truly sticky sites like Facebook offer. Should Peloton and products like Mirror engage in this social measurement and validation, I expect that these products will gain a strong following – one that will require collaboration with traditional sports brands.
What does this mean for sporting goods manufacturers and retailers? To me, the takeaway or focus should be to look at these media-based sports platforms, like Peloton, as a hub of community where both retailers and manufacturers can create new opportunities to connect with and advertise to consumers who are training at home. With a media-based workout class, there are enormous opportunities to advertise pre- and post- workout and to sponsor the emerging stars of the show – the trainers that lead classes. With the potential to offer unique items suited for use while participating in a streaming class, manufacturers can reap rewards by creating product extensions specific to the in-home workout experience.
In my next blog, I’ll dive into how products like Zwift are providing a true gaming experience through virtual multiplayer environments. The gamification of sport is opening lots of interesting doors, making it another important pillar to the Internet of Fitness.