Peloton has lowered the price of its original stationary exercise bike to $1,495, which is $400 off its previous price tag and the second time the company has lowered the price of the luxury bike in the past year.
The first company to replicate the experience of an in-studio fitness class using a touchscreen and instructor-led classes, Peloton arguably revolutionized at-home fitness when it debuted in 2014. But the high price of its bikes has always cemented them as luxury products. The company has been widely mocked in the past over its advertisements that depict the bikes being used by customers who live in luxury settings. Peloton hopes the new pricing will help it go mainstream.
Lux — It’s not totally fair to say that Peloton bikes are reserved for the wealthy — the company heavily promotes its financing options, and with the new price tag a bike can be had for $39 per month. Peloton says it will also offer new financing options to customers who want to buy its more premium Bike+ or its treadmill, simply called Tread. Customers still have to pay $39 per month for access to Peloton’s workout content, though, and financing can be out of reach to people without good credit scores. Peloton products are cheaper (and thanks to COVID, safer) than going to an in-person spin studio everyday, but are still decidedly a premium product.
It’s just business — The bike saw its price first drop last year, when Peloton released the Bike+, so this second price drop in just a year is frustrating some earlier buyers. “Don’t begrudge new people getting their equipment at a nice price,” reads one tweet in response to Peloton’s announcement. “But two price drops in the year plus after I purchased mine is disheartening.”
Peloton could potentially make a special offer to anyone who purchased in the last year, but that’s kind of just how business goes. Peloton is competing against more affordable alternatives from Echelon and others; even Apple has its own Fitness+ service that people can use with a standard stationary bike. A price reduction is necessary to stay competitive.
The past year has seen a huge surge in demand for Peloton bikes, for obvious reasons, but the company is also struggling to source supplies and was forced to recall its treadmill over safety issues. That product will go back on sale on August 30.
Peloton’s stock price dropped as much as 15 percent following announcement of the newly reduced pricing, which it said will hurt its bottom line this year. Growth was also generally slower than investors hoped, which probably explains the price cut.