The future of fitness is at a fork in the road
Why it matters: The fortunes of companies like Peloton and Planet Fitness hang in the balance of which way habits will go as more people prepare for a return to the new normal.
- Peloton sales saw triple-digit percentage growth in 2020 and a swing of $140 in its stock price in the past year.
- Planet Fitness held on through a rocky year and plans to open 100 gyms this year as competitors like 24 Hour Fitness and Gold’s Gym filed for bankruptcy.
Driving the news: Connected home gym startup Tempo raised $220 million in new venture capital this week – a sign that investors don’t buy into the “at-home fitness has peaked” theory, Axios’ Dan Primack reported.
- Nearly a year ago, Tempo competitor Mirror was sold for $500 million to athleisure brand Lululemon.
- In October, fitness coaching app Future raised a $24 million Series B.
To cover all their bases: Fitness companies and gyms are bundling their products and services to draw customers into newly created ecosystems (think of it like Apple iOS) and to keep them there.
- At the onset of the pandemic as gyms were forced to close, Equinox introduced a virtual fitness app for its popular classes called Equinox+.
- Streaming workouts has also been a way for consumer and gym equipment makers to bridge in-person and at-home experiences, which is why NordicTrack's parent company launched a platform like Peloton’s to make the same videos available for its machines, phone app and TVs.
- Keeping customers loyal and inside an ecosystem is what Peloton and fitness tech startup Tonal does well through social media community building outside of its own products.
- Apparel companies realize the benefit of an ecosystem as well, which is why brands like Alo Yoga and Fabletics have launched fitness apps and skincare products.
The bottom line: Fitness businesses have to be ready regardless of which way the kettlebell swings.