June 25, 2024


A stationary bicycle inside of a Peloton store is pictured in the Manhattan borough of New York City, U.S., January 25, 2022. 

Carlo Allegri | Reuters

Peloton has quietly removed its unlimited free-membership tier on its fitness app less than a year after it debuted because the initiative was failing to convert users into paid subscribers, the company said. 

Peloton dropped the free option for new users, once a key part of the business’s growth strategy, within the past few weeks. People who signed up for the company’s unlimited free membership before it was removed will continue to have access to it, Peloton said.

New users who are looking to work out with the company’s app now only have access to two tiers that cost $12.99 a month or $24 a month, with the option of a seven-day free trial. 

Last May, Peloton debuted a splashy rebrand that billed the business as a fitness company for all, and put its digital app at the center of its marketing campaign. The rebrand brought a new, tiered app strategy that included the unlimited free-membership option and two other paid levels that all had varying levels of content.

The rebrand came as CEO Barry McCarthy looked to transform Peloton from one focused on its hardware to a business that was equally as invested in its app. As sales steadily declined at the company, he was working to capture new customers who may have been intrigued by the brand but weren’t willing to shell out thousands for its equipment. 

McCarthy, a former Netflix and Spotify executive, had long wanted a free tier on the company’s app. He had bet that free users would fall in love with Peloton’s content and then spring for a paid membership, which comes with a far wider variety of classes, after they tried the app and decided they wanted more. 

The bet appears to have been a bust.

McCarthy told investors in November that the relaunch had been “less successful at engaging and retaining free users and converting them to paying memberships” than the company had expected.

Soon after, the unlimited free tier was no longer available. 

During a Morgan Stanley conference in March, finance chief Liz Coddington said the company “quickly” learned that the free tier was “cannibalizing” efforts to convert free-trial members to paid subscribers, which led the company to shift to a free-trial model. 

“It’s important to know that our app is still a work in progress. We still have a lot of opportunities to improve it,” said Coddington. “What we found is that we need to figure out ways to better engage them during the trial period, that they convert to paid and then also keep them engaged over time, so that they will retain at a higher rate. … When we do that, we believe that our marketing efficiency will improve, both because we’ll have better retention and better conversion rates.” 

While app subscribers declined during Peloton’s fiscal second quarter ended Dec. 31, Coddington said the company still “believe[s]” in its app strategy and it remains “an important part of the business.” 

Don’t miss these exclusives from CNBC PRO


Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

Batman138 Bro138 Dolar138 Gas138 Gudang138 Hoki99 Ligaciputra Panen77 Zeus138 Kilat77 Planet88 Gaspol168 Sikat88 Rupiah138 Garuda138 Gacor77 Roma77 Sensa138 Panen138 Slot138 Gaco88 Elanggame Candy99 Cair77 Max7 Best188 Space77 Sky77 Luxury777 Maxwin138 Bosswin168 Cocol88 Slot5000 Babe138 Luxury138 Jet77 Bonanza138 Bos88 Aquaslot Taktik88 Lord88 Indobet Slot69 Paus138 Tiktok88 Panengg Bingo4d Stars77 77dragon Warung168 Receh88 Online138 Tambang88 Asia77 Klik4d Bdslot88 Gajah138 Bigwin138 Markas138 Yuk69 Emas168 Key4d Harta138  Gopek178 Imbaslot Imbajp Deluna4d Luxury333 Pentaslot Luxury111 Cair77 Gboslot Pandora188 Olxtoto Slotvip Eslot Kuy138 Imbagacor Bimabet