Expanding their reach: Connected fitness companies’ long-term success is dependent on their ability to attract and retain subscribers willing to pay a monthly fee to access content.
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Peloton has taken a multipronged approach to attracting new members. Beyond the Dick’s collaboration, it recently began selling on Amazon and rolled out a so-called fitness-as-a-service program that allows consumers to pay a monthly fee to rent equipment and access fitness classes. It also offers a digital app subscription.
- Lululemon’s similar Studio service offers on-demand and livestreamed classes as well as online classes from boutique studios such as Pure Barre, in addition to discounts to in-person classes at those studios.
The big takeaway: Recurring revenue models are incredibly powerful as they can provide companies with predictable income, financial stability, and brand loyalty. But the model only works if companies continue to grow their base and minimize churn.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.