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Peloton Unplugged
Side dishes are the best part of Thanksgiving. Candied yams. Mashed potatoes. Stuffing. Yum. On Thanksgiving 2020, 88,000 Peloton subscribers had a side of cycling with their turkey. The company’s Turkey Burn workouts would have overflowed MetLife Stadium’s 82,500 seats. Peloton illustrates how business models, constraints, and opportunities are changing as economic activity shifts online.
Keeping Emma Busy
The internet enables scale that’s impossible to match offline. For example, Peloton has 36 fitness instructors. In the fourth quarter of 2020, it logged 98 million workouts. On average, each instructor led 30,000 athletes per day, enough to sell out Madison Square Garden and then some. Hosting 98 million workouts offline would require thousands of instructors, orders of magnitude more than what Peloton employs.
Modest headcount can serve massive online audiences. In September 2017, Peloton had 11 instructors and logged 2.5 million quarterly workouts. In the fourth quarter of 2020, Peloton logged 98 million workouts, a 3,800% increase. Over that period, instructors grew 227% to 36 from 11. Similarly, quarterly workouts per instructor grew 11x to 2.7 million from 227,000. Scaling like this only happens online.
