Peloton’s Free Lunch

People love free stuff. In the summer of 2007, I interned on a Wall Street trading floor. Times were good. Housing prices and bonuses could only go up . At lunchtime, I was struck seeing traders in Ferragamo ties jostling for free Chinese food. As a college student, there was a lot I’d do for a free meal: attend guest lectures, film screenings, club info sessions, you name it. It turns out a trading floor wasn’t that different, except for all the Gucci loafers.

On June 22nd, Peloton launched Corporate Wellness. The program’s economics should make the company as happy as an equity trader with a full plate of free lo mein.

More than Ellipticals

In December 2020, Peloton acquired commercial-fitness maker Precor for $420 million 2. The rationale was clear. At a time when Peloton’s Asian supply chain was logjamed, Precor provided US manufacturing capacity. Additionally, it had deep expertise in strength, a vertical Peloton was keen to enter. It also had a rolodex of relationships with colleges, corporate campuses, hotels, and multi-family residences.

Corporate Wellness enhances the deal’s strategic rationale. Precor’s corporate contacts are an instant source of leads. It has the relationships while Peloton has the brand cache and a product employees and employers can get excited about.

Peloton is partnering with companies to offer free or subsidized access to Peloton Digital, which offers classes like yoga, strength, and meditation and doesn’t require hardware…