Peloton Vulnerable to Studio Comeback
Andy Hoang, CEO of Aviron, on the unit economics of connected fitness
Peloton is the most exposed connected fitness company when real world classes come back, because its core product is a home version of a class people can buy elsewhere. A Peloton rider in a dense city can swap a monthly subscription for a nearby spin studio and get the same basic workout format, music led cardio with group energy. That substitution is much weaker for products like Aviron, Tonal, and wearables, where there is no equally direct offline replacement.
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Peloton built around the boutique studio playbook, instructor led classes, frequent new content, and music heavy workouts. That makes the product engaging, but it also ties value to a format that already exists outside the home. Aviron’s interview and connected fitness research both frame games and broader content as a deliberate move away from that dependency.
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The economics differ too. Peloton has to keep paying for instructors, fresh production, and music rights, while game based products can spread development costs across many users over time. When reopenings lower engagement, that fixed content engine gets harder to support. Peloton’s average monthly workouts per connected fitness subscriber fell from 22 in 2021 to 16.4 in 2022 in related connected fitness research.
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This pressure is also geographic. SoulCycle and similar studios are concentrated in dense urban markets, and the interview notes that many Aviron buyers are outside those areas. In cities, the substitute is obvious and close by. In suburbs and smaller markets, home equipment still wins on convenience because the equivalent boutique class may not exist nearby.
Connected fitness is likely to keep splitting into two lanes. Products that mainly digitize an existing studio class will keep competing with gyms and boutique chains for the same weekly workout budget. Products that create a distinct home experience, through strength hardware, gaming, or persistent tracking, should hold up better because they are harder to replace with a trip back to class.