In its first run outside of its core direct-to-consumer business, Peloton will be showing off a selection of connected fitness equipment and accessories starting Wednesday on Amazon in the US.
This will include her original bike, which retails for $1,445. It will also sell its powerful product known as the Peloton Guide, which costs $295. The more expensive Bike + and Treadmill are excluded from the linkage process.
Peloton stock is up more than 18% in early trading.
Peloton chief commercial officer Kevin Cornells said there are already about half a million searches on Amazon each month for Peloton products, although they weren’t on the site before Wednesday.
“The retail environment — both online and in stores — continues to evolve, and that’s something we’re trying to understand better to make sure that the future Peloton is calibrated appropriately for that,” Cornells said in a phone interview.
“We want to make the acquisition of the Peloton as easy as possible,” he added.
This will be Peloton’s first partnership with another retailer to sell its merchandise. So far, the company has relied on its own website and physical showrooms, selling them directly to consumers. But under CEO Barry McCarthy, who took over in February, Peloton has committed to expanding its distribution globally and lowering customer acquisition costs to return the business to profitability.
peloton Initiated a $800 million restructuring plan When the company’s founder, John Foley, stepped down as CEO in February, costs spiraled out of control and losses mounted. It’s been since then Test subscription form for its equipmentAs another way to increase sales. Peloton too Exited from all internal manufacturing processes To simplify the supply chain.
earlier this month, The company announced additional cost-cutting measuresIncluding more layoffs, store closures, sudden price hikes, and last-mile deliveries.
Peloton’s stock price is down nearly 70% year-to-date, as of the market close on Tuesday. Its market value has fallen to about $3.7 billion, from $50 billion in early 2021.
Moving to Amazon refers to McCarthy, formerly Netflix And the spotifyDon’t be afraid to take risks to get the business back on a stronger footing. McCarthy He also said that the Peloton goal Is to one day count 100 million members, which is a goal Foley mode in 2020. Peloton finished its last quarter with nearly 7 million members.
In addition to Bike and Guide, Peloton will sell on Amazon a selection of accessories, including branded cycling shoes, bike mat, weights, yoga blocks, water bottle, and heart rate band. Shoppers will also see a variety of branded clothing, including sports bras, leggings, shorts, tank tops, hats, and joggers.
“This is a really good start for us, with a digital retailer, to test the situation,” Cornells explained.
Over time, he said, Peloton could adjust its lineup on Amazon because it knows what people are looking for. He added that Peloton is also likely to look to other retailers to strike similar deals to expand its reach.
It might also make sense for Amazon and Peloton to consider making the fitness company’s live and on-demand workout content another feature to drive Amazon Prime customers. Cornells has not confirmed whether this is a possibility.
Analysts speculate that Peloton is considering ways to expand the distribution of its content under the direction of McCarthy, a content and subscriptions expert.
Shoppers who purchase a Peloton bike from Amazon will be able to select the self-assembly option rather than scheduling time with a professional to assemble it together. The Expert Pool option will be available for those who prefer it.
Cornells said it would be a learning experience for the company to learn what customers prefer and how they respond to the self-assembly option. This isn’t something Peloton has offered before, but it’s another way the company can cut costs.
Peloton’s support team will manage ongoing customer service requests for repairs, maintenance requests, subscriptions and general inquiries, according to the company, while Amazon’s customer service team will provide support for product purchases, delivery, installation and returns.
“Physical retail will always be an important part of our strategy,” Cornells said. ‘This is more of a reflection of us trying to emulate the consumer.’
Peloton is due to release its fourth-quarter financial results before the market opens on Thursday. Analysts expect the company to report a loss per share of 72 cents on revenue of $718.19 million, according to Refinitiv consensus.
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