About four months ago I bought my wife a Peloton® bike. She loves to work out and is very disciplined about it, rarely missing a day. Earlier in her life she had been a spinning instructor, and so when she saw the television ad she put it on her wish list. She had a birthday coming up, and so it was a “no brainer” for me on what to get her.

Image courtesy Peloton®

On the other hand my exercise history could be labeled erratic at best, and so I didn’t really plan on using the bike very much. We have various pieces of exercise equipment in our home and I get bored easily with the repetitive nature of the workouts. I would do them for a little while then find that I just drifted away and stopped. That didn’t happen with this particular stationary bike. I found myself looking forward to the workouts each day and I am still going strong after four months.

I’m a curious marketer at heart, and so the more I got into exercising the more I admired what the company has been able to accomplish through video marketing, especially since I had looked at this very same category many years ago.

Backstory

In the early 2000’s spinning was just starting to become popular in the U.S.. Spinning was created by a South African, former special forces military man turned cyclist named Johnny G. He had just opened a new studio in Los Angeles. At the time I was still doing a lot of production and marketing projects for the company that bought my Juicer business, Salton Inc. They were always on the lookout for new products they could promote through a DRTV/Retail model. Their CMO at the time, Barb, was a big road cyclist that had just started taking spinning classes and was raving about them. She reached out to Johnny G., who was the spinning guru and set up a meeting at his studio. Thinking it was going to be a regular business meeting, I wore my normal business clothes at the time — slacks and a sports coat. The CEO of Salton, Leon, was also there in his best suit. If you look at an indoor spinning bike, it’s kind of big, heavy and boring. It’s a bicycle that doesn’t move, hence the name stationary bike. I couldn’t really see what all the fuss was about for spinning. Then Johnny suggested, actually insisted, that he take us through of one of his classes, so we would get the full experience. Part of Johnny’s success was his personality and passion for what he did. I’ve worked with some great pitchmen in my time like Billy Mays, George Foreman, and Jay Kordich, I would put Johnny right up there with them for the energy he brings. We had no idea what we were getting into. After a little struggle he convinced us to take off our sports coats and got on the bikes. The music was turned up and Johnny started urging us on and it was awesome! Within 10 minutes our clothes were drenched in sweat and I said to myself, “now I get it.” We were sold on the concept.

Being a D2C marketer I started to analyze what would be involved in the project if we moved forward. We had a very large, heavy product that would be difficult and expensive to ship. The margins were not great and it did not pan out financially as a one time sale. But, the biggest obstacle was the problem of how we could deliver the excitement we felt in the live class with a live instructor, and cool music playing. Technology at the time didn’t allow it and without that live experience I did not think it could work. We passed on getting involved in the project.

Fast Forward

Several years ago I started seeing direct response ads on television for the Peloton® bike, and I kept seeing them over and over. Usually a good indicator that they were working from a positive ROI standpoint. Their ads are classic “direct branding” spots with high quality images with a call-to-action to place an order or find out more at the end of each commercial. This was similar to what I helped GoPro do to propel their growth.

I realized that here was a company, which found a way to unlock the secret to success on selling indoor cycling. Let’s take a look at some of the video marketing techniques that helped make them successful.

Recurring Revenue Model

One of the main reasons many D2C campaigns fail is because the financial model will not support the advertising dollars being spent. As a consultant one of the first things I do is run a financial proforma to make sure the numbers work before any video is shot. One of the reasons I did not do the original spinning bike at the time was that there was only revenue from a one-time sale, the product was expensive to ship and the margins were not good. The financial model for a D2C campaign just didn’t work.

With Peloton® it was different — when I bought my bike, not only was there a cost, but then you could purchase the on-going classes at $39.00 a month for as long as you wanted to have access to them. This is a very nice back-end revenue stream. The lessons, music and instructors are so good that we are happy to pay this fee every month, and it’s way cheaper than a live class at a studio, but you still get all the benefits. With this ongoing revenue stream the ROI model not only makes sense, it is an absolute home run.

Influencers/Instructors

When I first moved to Seattle in 1986, I was walking through some shops in the Pioneer Square area just south of downtown. I went into a print shop to look at some of the pictures they had hanging on the wall. One of the framed posters had a headline that jumped out at me: “The Lures Of Advertising.” Since I like fishing and advertising I thought this was intriguing. I bought the poster and many years later it still hangs on my office wall. The slogan at the bottom of the poster reads: “The advertising club of greater Boston wishes you a good catch.” It showed various fly-fishing lure images with names under them like; Hard Offer, Soft Offer, Celebrity Images, Appetite Appeal, The Beauty Promise, Jingles, The Lure of Sex , ect. Let’s just say Peloton® has tapped into several of these “lures” to hook their customers and keep them on the line. They use top male and female instructors who are very inspirational and easy to admire to lead the classes. They appeal to both male and female riders. You get to choose your favorite instructor every morning, afternoon or evening workout. Being able to put these instructors on streaming video set to great music is one of the secrets to their success. Using video they are able to deliver that live class feel right into your home.

Live Class/Competition

With the advent of spinning studios like Soul Cycle, which gets many people in the same room at the same time competing with each other, it makes exercise fun. The live classes have a leader board up front to see how you are doing compared to the rest of the class and this creates an atmosphere of both excitement and competition. Using streaming video, Peloton® is able to deliver this same experience right into your home. Now you are not only competing against your class, but with people nationwide.

Video Content Marketing

It does not matter what level spinner you are, Peloton® provides workouts starting for beginners all the way up to advanced riders. You can pick the length of the workout you want, the type of music you like to work out to and even your favorite place in the world you always dreamed of cycling. There is constantly new video content being produced and made available to you as a subscriber to keep you happy and engaged.

Beautiful Brand Response Advertising

It might seem like it, but I am not a paid spokesperson for Peloton®. But when I see a good product with a successful D2C marketing campaign that is using all aspects of video correctly I like to talk about it.

I mentioned earlier the company’s use of brand response television ads. If you are thinking about doing a D2C product marketing campaign, go to YouTube and view the ones they have produced here. They have done a really good job of capturing the emotional appeal of being physically fit and also delivering the benefits to you of owning one of their bikes. Great work!