Campaign Rebranding Report for Peloton Interactive UK Limited

Task 1: A brand in crisis

Introduction

Peloton Interactive UK Limited is one of the United Kingdom’s brands that has encountered a negative image and perception, especially by its key target audience in the ever-changing and competitive business setting. Besides, the organization is an ideal case study since it has encountered both the achievement of its brand and a harsh brand predicament in the at-home fitness section (The Guardian, 2023). Thus, this rebranding campaign report mainly emphasizes Peloton, which has encountered brand success in the UK market for the past three years. Nevertheless, the company’s brand perception has experienced a dramatic change, facing a negative change in its brand perception. Peloton runs in the UK, serving UK-based target consumers that include several health-conscious people and professionals (Kurutz, 2017). Between December 2020 and December 2023, the company’s brand-worsening journey revealed a story marked by numerous consumer complaints, such as executive departures, unethical advertising campaigns, safety recalls and reduced subscriber growth that instigated a series of criticisms (Forbes, 2023). Thus, the examination of Peloton’s chaotic narrative is backed by a comprehensive literature review obtained from numerous reliable sources, entailing journal articles, textbooks, and other publications. Additionally, the report will explore various aspects that have cooperatively destroyed Peloton’s once-remarkable brand reputation. Comprehending the difficulties of brand perception and the complexities shown by the dynamic and competitive market is accessed by viewing the multifaceted image of Peloton’s problem that entails various aspects, such as shifting market dynamics, pricing strategies, and safety matters.

Overview

Peloton, a once-famous brand in the at-home fitness industry, experienced a dramatic change from a market leader to a struggling brand with a serious negative image (Cosgrove, 2020). Its struggle started in 2021 when its advertising effort assumed a risky turn with the risky “Peloton Wife” ad. The ill-judged campaign, featuring a rich lady apparently abandoning her family to follow fitness on her Peloton bike, not only ignited prevalent criticism for Peloton’s sexist suggestions but also hardened a prevailing perception of the company as an exclusive brand serving mainly the lucky few. Nonetheless, in 2021, the company’s problems increased with alarming safety matters. According to Cosgrove (2020), Peloton was once a famous brand in the at-home fitness section. However, the company encountered a substantial shift from being a market frontrunner to experiencing serious problems with its brand image. These problems started in late 2019 when Peloton’s advertising effort assumed a risky turn with a risky “Peloton Wife” ad (Ortiz, 2019). This was an ill-judged campaign featuring a rich woman who ignored her family and concentrated on fitness with her Peloton bike, as Ortiz (2019) explains. This ad got prevalent criticism for its suggestions and also hardened a prevailing perception of the company as an exclusive brand serving mainly the lucky few.

Nevertheless, in 2021, Peloton’s problems increased as a result of the alarming safety matters regarding its commodities. Two distinct memories of Peloton’s routines were instigated, lifting a red flag regarding its obligation to customer safety. One memory entailed routines discharging users, whereas the other one concerned a trapped and injured kid (Isidore & Valinsky, 2021). Such unfortunate incidents led to legal measures and caused a substantial loss of public trust concerning Peloton’s fitness tools. Furthermore, the company’s image was further destroyed by complaints of accidents involving its iconic bikes (Isidore & Valinsky, 2021). Therefore, as concerns regarding safety continued to increase, the organization encountered a double problem of handling commodity-related problems and, most significantly, addressing the negative impact of its advertising blunder. Additionally, Peloton’s pricing plan and restricted features strengthened the perception of elitism linked to Peloton, rendering its services and products less accessible to some wider target consumers. According to Stieglitz (2023), the high pricing of Peloton’s products and depiction of a limited lifestyle in its advertising campaigns resulted in a huge section of its target audience being removed. Thus, the idea of elitism became a key barrier to the company as rivals providing more reasonable substitutes joined the at-home fitness marketplace.

The problem heightened when John Foley, Peloton’s CEO, and essential managers chose to resign from the organization in 2022 (Thomas, 2022). As a result, it raised concerns regarding Peloton’s stability and strategic direction. Besides, as subscriber growth and stock price reduced substantially, the company encountered financial issues that further reduced confidence in its brand. Moreover, the organization faced difficulties from the shifting environment in the at-home fitness section. The market experienced a flow of substitutes that provided cost-friendly and more accessible selections, outshining Peloton’s greater-priced commodities (Link, 2020). Besides, the developing acceptance of outdoor events and trends in hybrid workouts questioned the company’s position as the go-to resolution for at-home fitness. Thus, factors like the unsuccessful emergency communication and the recognized lack of transparency have led to a substantial loss of confidence and trust in the Peloton brand.

Task 2: Campaign rebranding

The brand prism

Peloton’s strategic rebranding strategy influences the brand prism framework to restructure its identity completely. Thus, the strategy seeks to rebrand and revive Peloton’s negative perception and promote a transformed, constructive association with its clients via a strategic arrangement of communication channels, tools, and a clear knowledge of the target customers. Besides, according to Zwakala & Steenkamp (2021), with the brand prism performing as a directing light across every aspect of Peloton’s transformation, the step towards a restored brand image is both promising and viable.

Physique

Peloton’s rebranding begins with an emphasis on its physical appearance. According to Zwakala & Steenkamp (2021), this aspect involves thorough improvements to product reliability and safety. Thus, the company seeks to redefine its physical existence by executing state-of-the-art experimental procedures and clear communication. Besides, by guaranteeing the greatest safety of its fitness tools and communicating such enhancements successfully, the company seeks to restore trust amongst its clients and generate a constructive relationship with its commodities, as Zwakala & Steenkamp (2021) explain. For instance, the safety-conscious client profile is a key person who values a thorough advancement to product reliability and safety. Such a person is more likely to search for insurance that prioritizes their well-being, appreciate transparent communication regarding product enhancements, and select a fitness procedure that is associated with safety standards.

Personality

As Zwakala & Steenkamp (2021) note, under this aspect of the Brand Prism model, Peloton predicts a change towards accessibility and inclusivity. Thus, the brand will be positioned as a fitness solution to all demographics, discarding its former elicit image. Involving marketing campaigns will emphasize varied consumer stories, stressing that Peloton is a brand for everybody. Thus, according to Barros et al. (2016), the personality shift seeks to generate a more applicable and friendly identity, echoing positively with a wider audience and dismissing any predetermined idea of exclusivity. Thus, an inclusivity-centered consumer profile appreciates a change toward accessibility and inclusivity. Such an individual values the brand effort to shelter its exclusive image, linking to Peloton’s mission of being a fitness resolution to all. Moreover, they resound with varied customer stories and perceive Peloton as a brand that cares for all demographics.

Culture

To redesign the cultural identity related to Peloton, the rebranding plan stresses community-building (Mindrut et al., 2015). Thus, programs like user-created content, social media issues, and virtual workout teams will promote a feeling of belonging amongst Peloton’s customers. Besides, by generating a fitness community around the brand, the company aims to redefine its cultural story and stage itself as a fitness tool provider and a hub for mutual experiences and shared support. Thus, a community-centric client profile appreciates the focus on community-building (Mindrut et al., 2015). Such an individual actively participates in user-created content, social media issues, and virtual workout teams. Moreover, they pursue a feeling of belonging and shared support in the Peloton fitness community, appreciating mutual experiences and a supportive system.

Relationship

According to Zwakala & Steenkamp (2021), under this aspect, Peloton’s rebranding emphasizes promoting sounder relations with its consumers. This entails responsiveness to consumer feedback, active participation on social media podia, and clear communication. Thus, by prioritizing open and authentic communication, the company seeks to rebuild trust and develop a more constructive and dynamic association with its clients (Submitter & Ross, 2020). Therefore, a participative and communicative customer profile values Peloton’s emphasis on promoting stronger association. Besides, such an individual appreciates brand responsiveness, offers feedback, and actively engages in social media platforms.

Reflection

According to Zwakala & Steenkamp (2021), this aspect entails reshaping how Peloton is seen in a wider setting. Thus, the rebranding will stress constructive shifts, innovations, and brand obligation to safety and inclusivity via a narrative framing and strategic interaction. Besides, by changing the external perception of Peloton, the brand seeks to generate a serious image that is associated with its new values and identity. Thus, a socially conscious customer profile is adjusted to how Peloton is seen in a wider environment, as Yuan et al. (2016) denote. Such a person values the brand’s importance on constructive shifts, innovations, safety, and inclusivity. Furthermore, they associate themselves with a brand that reflects values crucial to them, rendering Peloton a constructive reflection of their viewpoints.

Self-Image

The Self-Image facet addresses how consumers perceive themselves through their association with Peloton (Salih, 2016). The rebranding aims to empower users, encouraging a positive self-image through fitness achievements, community engagement and shared success stories. By aligning the brand with positive self-perception, Peloton seeks to position itself as a catalyst for personal growth and well-being, fostering a sense of pride and accomplishment among its user base. The self-motivated and achievement-oriented customer profile sees Peloton as a catalyst for personal growth, as Salih (2016) notes. This individual finds empowerment through fitness achievements, active community engagement, and shared success stories. They associate their positive self-image with Peloton’s commitment to fostering a sense of pride and accomplishment.

Table 1: A range of appropriate communication tools and channels that are relevant and targeted to the brand’s target audiences.

Customer-Based Brand Equity (CBBE)

Level one: Brand Identity – Physique and personality

According to Raji et al. (2019), in developing Peloton’s brand identity, the physique aspect echoes a consumer profile looking for assurance in fitness tool protection. It might entail new parents who value secure home workout settings for themselves and their kids. On the other hand, the personality aspect emphasizes inclusivity, appealing to professional consumers and guaranteeing that the organization is considered a fitness solution that is available to all clients, including those with busy timetables.

Level two: Brand meaning – Physique, personality, and culture

According to Çifci et al. (2016), the physique aspect at this level serves a fitness fanatic consumer profile, stressing Peloton’s obligation to product safety improvement, a major concern for consumers who are passionate concerning their workout procedures. On the other side, culture stresses community-building that reverberates with socially conscious clients who pursue fitness and an encouraging community.

Level three: Brand Response – Relationship and Reflection

Based on the relationship aspect, Peloton’s clear interaction and question-and-answer periods satisfy engaged and communicative consumers (Netemeyer et al., 2019). Besides, such a customer values a chance to connect with the brand. Similarly, the reflection aspect satisfies a socially conscious client, surrounding stories that positively impact brand perception. Thus, it relates to clients who value a brand, which reflects their obligation to constructive transformation.

Level four: Brand Response – Self-Image and Reflection

At this level, Peloton seeks to generate a profound relationship with its consumers (Wong & Teoh, 2015). Thus, the self-image aspect resonates strongly with wellness-centered consumers, empowering them through motivational campaigns and success narratives. Simultaneously, the positive external perceptions generated by the Reflection facet contribute to brand loyalty and recommendations, appealing to customers who seek brands aligning with their self-perceptions and values (Raji et al., 2019).

Table 2: Communication tools

Table 3: Peloton Customer profiles

Table 4: Gant chart

Table 5: Budget

References

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Çifci, S., Ekinci, Y., Whyatt, G., Japutra, A., Molinillo, S., & Siala, H. (2016). A cross-validation of Consumer-Based Brand Equity models: Driving customer equity in retail brands. Journal of Business Research, 69(9), 3740-3747. https://doi.org/10.1016/j.jbusres.2015.12.066

Cosgrove, E. (2020). “Peloton struggles with upstream delays amid pandemic demand

surge.” Available online at https://www.supplychaindive.com/news/coronavirus-peloton-deliver-pandemic-demand-surge/577656/.

Forbes (2023). Peloton Shares Plummet 7% As Exercise Company Recalls 2.2 Million Bikes

https://www.forbes.com/sites/brianbushard/2023/05/11/peloton-shares-plummet-7-as-exercise-company-recalls-22-million-bikes/?sh=1e31541a4020

Isidore, C. & Valinsky, J. (2021, May 5). Peloton recalls all treadmills after a child’s death and 70 injuries | CNN business. CNN. https://edition.cnn.com/2021/05/05/business/peloton-treadmill-recall/index.html

Kurutz, S. (2017). “Peloton Instructors Ride for Fitness and Fame.” The New York Times. ISSN 0362-4331.Available online at https://www.nytimes.com/2017/02/01/style/peloton-fitness-cycling-celebrity instructors.html.

Link, R. (2020). The 8 Best Peloton Bike Alternatives of 2020″. Available online at https://www.healthline.com/nutrition/peloton-bike-alternatives.

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Ortiz, A. (2019). “Peloton Ad is Criticized as Sexist and Dystopian,” New York Times.

Available online at https://www.nytimes.com/2019/12/03/business/peloton-bike-ad-stock.html

Peloton (2023). Peloton® | Exercise bike with indoor cycling classes streamed live & on-demand. The ultimate fitness experience. https://www.onepeloton.co.uk/company

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Stieglitz, B. (2023, September 7). Peloton’s brand gets slammed again after unfavorable billions scene. Mail Online. https://www.dailymail.co.uk/news/article-10433761/Pelotons-brand-gets-slammed-unfavorable-portrayal-Showtimes-Billions.html

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Thomas, I. (2022). The fall of Peloton’s John Foley and the stock market’s big founder problem. CNBC. https://www.cnbc.com/2022/02/12/the-fall-of-pelotons-john-foley-and-the-markets-big-founder-problem.html

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