Multifamily developers vs. Peloton: Round 2... Fight!
By now you may have heard that Peloton is no longer selling its bicycles and interactive programming service to multifamily properties (see my blog, “Peloton to multifamily communities: Drop dead.”) In late September, Peloton went public with an IPO (PTON:NASDAQ).
Looking back, it’s clear that the sales cutoff to apartment and condo properties had all to do with making the company’s future sales prospects look good to investors. (The IPO share price was set at $29 but quickly fell below $22; it was trading at $22.71 on October 8.) You can hear the company’s number crunchers saying, Why should we sell two or three bikes to an apartment building operator when we can sell our wonderful Peloton bicycles to every one of the hundreds of tenants?
This may sound logical but such a strategy will prove stupid in the extreme for Peloton. As Holli Beckman, Vice President of Marketing & Leasing Operations for W.C. Smith, told Paul Bergeron, Chief Editor of the National Apartment Association’s units Magazine, “Their bikes in our studio fitness rooms are basically showrooms for potential buyers. We are paying Peloton for the opportunity to promote their product instead of them paying thousands on showrooms in malls.”Several of my blog readers confirmed that this was precisely their experience. “I tried Peloton in my apartment building, got hooked, and then bought a Peloton for my home,” a self-described 60-year-old C-suite executive told me.
Another wrote: “My wife and I were introduced to Peloton through our condo gym and now we are picking our next home with space for a Peloton in mind. I never would have even considered buying a $2,200 exercise bike without the exposure.”
A co-op owner in New York reminded me that “having space in our apartment for a Peloton bike is not viable.” She said her board will be “looking elsewhere for new equipment.”
Searching for alternatives to Peloton for apartment and condo buildings
There are quite a few alternatives to Peloton, currently priced at something like $2,499 to $2,750, plus a monthly membership fee. In his thoroughly researched article, Bergeron mentions Expresso, Hydrorider (low-impact aqua bike), NordicTrack, and Technogym (made in Italy). A reader of my blog said she was looking into Flywheel Sports.
A helpful review by Ed Oswald on www.digitaltrends.com cites the $1,999 NordicTrack Commercial S22i Studio Cycle; the $999 ProForm Studio Bike Pro; the $499 Schwinn IC3 Indoor Cycling Bike; and the $297 L Now Indoor Cycling Bike (“great reviews from customers”).
Oswald’s “best all-around alternative to the Peloton”: the $840 Echelon Smart Connect EX3 MAX Indoor Cycle. It offers live streaming workouts via smartphone or tablet with an included app.
So, eat your heart out, Peloton. Apartment building owners and their tenants will get along quite nicely without you.
