Peloton Interactive Inc, the brand that essentially re-invented the home exercise bike, has announced it will start selling its “bikes” and accessories on Amazon.com. This is a significant move for the company that previously only sold direct-to-consumer via its own eCommerce channels and retail stores.
Ironically, for a company that sells stationary bikes, Peloton has been on a bit of a journey in recent years. The company saw incredible growth during the Covid-19 pandemic, with lockdown closing gyms and forcing people to look for alternative exercise options. However, as the world emerged from the pandemic, it has struggled to maintain traction, with media reports highlighting how the company lost more than half of its value in recent months.
Peloton’s changing fortunes have forced the company to cut staff, close retail locations, and consider alternative routes to market, including Amazon. The company has also outsourced delivery of its exercise machines to third-party organisations.
Online Marketplace Sales
By opting to sell on Amazon, Peloton now has access to hundreds of millions of global consumers, including close to 150 million Amazon Prime subscribers in the United States. In addition, while Peloton is currently only listing its products on Amazon.com, it offers free global shipping on its $1,345 exercise bike.
As a leading global exercise brand Peloton has invested heavily in its presence on Amazon with a fully featured Amazon store design, sponsored brand and sponsored product ads, and detailed A+ content to promote their products.
Speaking to journalists, Peloton’s chief commercial officer Kevin Cornils said: “Expanding our distribution channels through Amazon is a natural extension of our business and an organic way to increase access to our brand. We want to meet consumers where they are and they are shopping on Amazon. Providing additional opportunities to expose people to Peloton is a clear next step, as we continue to generate excitement for our unparalleled connected fitness experience.”
Cornils’ optimism was echoed by Jim Adkins, vice president of recreational and vocational categories at Amazon, who told journalists, “We are thrilled to have Peloton products available for our customers in Amazon stores is all about bringing their community and energising fitness routines into the home. With Amazon’s convenient shopping experience, we hope to further that mission by providing customers with high quality, innovative products to take their health and fitness to the next level.”
From D2C to B2C And Back Again
The D2C business model has seen growth in recent years as manufacturers have seen incredible opportunities to sell direct to consumers, often supported by heavy promotion on social media channels like Instagram and TikTok. This has enabled them to cut out multiple intermediaries and either pass on the savings to the customer or keep more of the profit.
However, the D2C route isn’t without its challenges. For every premium brand like Peloton, there are many other look-alike brands ranging from serious competitors to low-budget options, selling both direct and via more traditional retail routes. In any competitive market, those premium D2C brands will lose sales to competitors selling on marketplaces where consumers can compare products against each other. If a product isn’t available on a high-profile retail site like Amazon, it may not be considered alongside more visible options.
For dedicated D2C brands, selling on online marketplaces like eBay and Amazon offers a halfway house between D2C and traditional B2C retail. By partnering with leading online marketplaces, the brand can reach millions of potential consumers without dramatically increasing its investment in retail distribution. D2C brands can also manage their own fulfilment or opt for third-party assistance while retaining complete control of their brand through branded marketplace design.
Online marketplaces also provide D2C brands a significant opportunity to market and sell distressed inventory, such as end-of-line and returns, and create new markets for refurbished goods without diluting their traditional D2C channels.
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Frooition has helped multiple D2C brands expand their sales onto online marketplaces. To learn more about how our eCommerce experts can help your business reach new markets while maintaining control over your brand, schedule a 15-minute discovery call today.
