Speaker 1: Bloomberg Audio Studios, podcasts, radio news, the Bloomberg Tech Summit
Speaker 1: in San Francisco. We have something specially on stage right now.
Speaker 2: Yeah, let's head on over to the main stage because
Speaker 2: we've got Peter Stern, the president and CEO of Peloton
Speaker 2: Interactive in conversations happening right now.
Speaker 1: It's with Bloomberg Technology s Marketermount.
Speaker 3: A typical day for me is like this morning, getting
Speaker 3: up and doing a little bit of cardio, ran to
Speaker 3: the gym actually, and then did also some strength training,
Speaker 3: and then I'm mostly spending my time working on those
Speaker 3: twenty five initiatives with our team members, trying to find
Speaker 3: how we can serve our members better.
Speaker 1: And you know, if I.
Speaker 3: Can spend my time on that kind of substance.
Speaker 1: That's a really great day.
Speaker 2: What are the top three of your twenty five?
Speaker 3: So I'm not going to announce all of the you know,
Speaker 3: all of the details of these sorts of things, but
Speaker 3: then I'll tell you a little bit about the top one,
Speaker 3: and that is that we have reignited the innovation engine
Speaker 3: for us as a company, and so focusing on the
Speaker 3: products and the experiences that we're going to offer over
Speaker 3: the next few months is absolutely my number one. Another
Speaker 3: one that I think is really important that we're focused
Speaker 3: on is how we use AI to deliver personal experiences
Speaker 3: for our members. That is another one I'm spending an
Speaker 3: enormous amount of time on, so huge priority for us.
Speaker 2: Talk to us a little bit more about that about
Speaker 2: AI and what does the future fitness look like with
Speaker 2: AI at its core.
Speaker 1: So every member is different.
Speaker 3: They all have different intents for why they choose to
Speaker 3: become a member of Peloton. That can change over time.
Speaker 3: So we need to not just get to know you,
Speaker 3: but we need to evolve along with you. Every member
Speaker 3: is different in terms of their baseline level of fitness,
Speaker 3: their level of commitment, their level of confidence, and so
Speaker 3: one of the things that I really value is the
Speaker 3: human coaching that are amazing instructors.
Speaker 1: Provide at Peloton.
Speaker 3: But I want to find ways to scale them by
Speaker 3: creating individualized programs for each of our members so that
Speaker 3: they can get the right class from the right instructor
Speaker 3: that's personalized for them. A really simple example of how
Speaker 3: we're doing it right now is that we do something
Speaker 3: called power zones on bike, or we do paste targets
Speaker 3: on tread where we actually set individualized speeds or levels
Speaker 3: of effort for each of our members. But then we've
Speaker 3: introduced a new set of features called personalized plans, and
Speaker 3: we've had at this point over six hundred thousand of
Speaker 3: our members have started a personalized plan, and the system
Speaker 3: basically understands your goals and then builds a plan out
Speaker 3: for you, and we deliver real results with these sorts
Speaker 3: of things. So just to give you an example of
Speaker 3: how this stuff really does make a difference.
Speaker 1: For example, when one of our members buys a treadmill, within.
Speaker 3: The first four weeks of using the treadmill, we're on
Speaker 3: average reducing their mild time by thirty seconds. So we
Speaker 3: can make real differences in somebody's conditioning and that translates
Speaker 3: not just into more confidence and better performance as an athlete,
Speaker 3: it translates into a longer life.
Speaker 1: What about data.
Speaker 2: Collections, you can get some more information about the user
Speaker 2: and then use AI to optimize their workouts. Do you
Speaker 2: need a wearable, do you need a new heart rate strap?
Speaker 2: Do you need more sensors on the treads and bikes themselves.
Speaker 3: Yeah, we're very lucky in this regard in that our
Speaker 3: members are doing a lot of that hard work for us.
Speaker 3: So we have a great partnership with Google Fitbit. For example,
Speaker 3: we have done integration with Garman smart watches because a
Speaker 3: lot of top athletes choose that, And we also are
Speaker 3: working with the Apple Health app to make sure that
Speaker 3: we can import data from there.
Speaker 1: A very large fraction of our members have.
Speaker 3: An Apple Watch, and that Apple Health app basically can
Speaker 3: act for many members as basically a Rosetta stone for us,
Speaker 3: allowing us to get access to the data that we
Speaker 3: need with the permission of the member. Once we have
Speaker 3: that data, now we can use the third party information
Speaker 3: that our members are providing us. But we have such
Speaker 3: rich first party information on our members as well, based
Speaker 3: on the workouts that they're doing on our machines and
Speaker 3: how much they're pushing themselves. If they have a watch,
Speaker 3: we can look at their heart rate and we can
Speaker 3: impute then how much effort they're expending. And if they
Speaker 3: don't have a watch, we can basically compare them with
Speaker 3: members who do have one, and so we can basically
Speaker 3: determine how hard you're working, and we can, for example,
Speaker 3: calculate things like a cardio fitness score.
Speaker 1: So I'm really excited about how we'll be able to
Speaker 1: use data.
Speaker 3: To deliver ever more personalized experiences for our members.
Speaker 2: So you said you did a workout this morning. Obviously
Speaker 2: pelotons based in New York, so you're here probably stayed
Speaker 2: in a hotel. How important is the hotel business in
Speaker 2: the gym business to Peloton under Peter Stern in compare
Speaker 2: it to the someone buys one for their home business.
Speaker 3: So the nice thing about this is these are not
Speaker 3: either or situations. I think it might have been perceived
Speaker 3: that way in the past, but it's absolutely not. Let's
Speaker 3: take travelers in hotels as an example. If you're the
Speaker 3: type of person who is in a hotel, then you're
Speaker 3: a person who is investing in yourself. You have some
Speaker 3: ability to pay for a service, and you're going to
Speaker 3: a hotel gym. You are really committed to taking care
Speaker 3: of yourself. That is a situation where we should have
Speaker 3: Peloton equipment everywhere. I'm really happy with the partnerships we
Speaker 3: have right now with Hilton and with Hyatt, where we
Speaker 3: have peloton equipment in most of their gyms. I do
Speaker 3: think in hotel gyms, basically, peloton equipment should be a
Speaker 3: must have amenity. It's the sort of thing where you
Speaker 3: shouldn't even choose. You wouldn't even want to stay in
Speaker 3: the hotel if it doesn't have the Peloton equipment that
Speaker 3: you count on having at home. And then that's a
Speaker 3: great way for us to meet new members because you know,
Speaker 3: some people might not have had a chance to try
Speaker 3: our equipment out, but while you're traveling at a hotel
Speaker 3: gym where you've got a little time on your hands,
Speaker 3: that's a great way to do it.
Speaker 1: Now, with regard to.
Speaker 3: Commercial gyms, there's also tremendous opportunities there. We have a
Speaker 3: number of pilots taking place with all sorts of gyms,
Speaker 3: including the y so we can try to make Peloton
Speaker 3: equipment as accessible as possible. But one of the things
Speaker 3: that I'm really excited about, and this is, you know,
Speaker 3: this is not something that.
Speaker 1: We've we've really talked about publicly before.
Speaker 3: Not a lot of people know that we own pre
Speaker 3: corep which is one of the leading providers of equipment
Speaker 3: to gyms everywhere.
Speaker 1: We are bringing pre Corp in.
Speaker 3: To basically be the lead partner in a commercial operating
Speaker 3: division for Peloton, and the pre Core business has the
Speaker 3: skills to be able to install and service equipment.
Speaker 1: To the exacting standards of gym operators who have very
Speaker 1: heavy duty cycle.
Speaker 3: On that type of equipment, and so we're gonna be
Speaker 3: able to bring Peloton equipment into more gyms with the
Speaker 3: capabilities of pre Core. At the same time, we're now
Speaker 3: bringing Peloton workouts onto pre Core equipment, which will really
Speaker 3: differentiate that pre Core equipment in the minds of gym
Speaker 3: operators and hopefully open up even more new audiences for them.
Speaker 1: So, you know, I would basically say this.
Speaker 3: Is a long overdue post merger integration that we're doing
Speaker 3: with pre Core and making it the foundation for our
Speaker 3: commercial business.
Speaker 2: How do most people buy a Peloton right? Are they
Speaker 2: subscribing to it with your rental program, are they doing installments?
Speaker 1: Are they buying it out right?
Speaker 2: And then earlier this week you launched a new program
Speaker 2: sort of a resale website, like a Craigslist for Peloton.
Speaker 1: I guess you can call it. Talk to us about that, I.
Speaker 3: Would say, Actually, so the two largest channels are people
Speaker 3: buying a Peloton equipment from our website. You go to
Speaker 3: one Peloton dot com and it's all there, and it's
Speaker 3: a really great way to buy it.
Speaker 1: But one of them.
Speaker 3: Ourgest ways for us to acquire new members is in
Speaker 3: the secondhand market.
Speaker 1: So you raised mark.
Speaker 3: This announcement that we had a couple days ago about
Speaker 3: something called Repowered, and the idea here is that there
Speaker 3: are lots of Peloton bikes in particular that are out
Speaker 3: there in the world that are being underutilized and that
Speaker 3: does no one any good. I'd love for people to
Speaker 3: get back on the bike. It's the right thing for them.
Speaker 3: Certainly it's great for us as a company. But if
Speaker 3: you're not going to use a Peloton bike, we want
Speaker 3: to make it really easy for you to get that
Speaker 3: into the hands of someone who.
Speaker 1: Will love it. And historically that's taken.
Speaker 3: Place, for example, on Facebook marketplace, and that's absolutely fine
Speaker 3: for people who want.
Speaker 1: To do that, but it means that you.
Speaker 3: Need to transact with a stranger on both ends and
Speaker 3: potentially have the stranger come into your home. And so
Speaker 3: what we're trying to do is streamline that and deliver
Speaker 3: a more premium experience for those secondhand customers.
Speaker 1: What this does is.
Speaker 3: It allows us to get our bikes that are built
Speaker 3: to last into the hands of people who will love
Speaker 3: it at a price. It's a fraction of a new bike,
Speaker 3: and there's no capital.
Speaker 1: Expenditure for us as a company.
Speaker 3: There's no environmental impact associated with producing those bikes because
Speaker 3: they're already out there in the world, and so it's
Speaker 3: a great way to help somebody get fit.
Speaker 1: And you know, grow our business.
Speaker 2: Last question for you, Peloton standalone business for years to come?
Speaker 2: Is it potentially an acquisition target for a larger company.
Speaker 1: What do you see as the You know, I was
Speaker 1: not hired to sell this company.
Speaker 3: I was hired to bring this company back to growth,
Speaker 3: to reinvigorate it, and it is happening.
Speaker 1: So there is we are. We are a standalone company
Speaker 1: for years to come. Great.
Speaker 2: Thank you, Peter Stern, thanks for having me Mark.
Speaker 1: All right, everyone, you've been listening to a live conversation
Speaker 1: between our Mark German and of course Peter Stern, who
Speaker 1: is the president and CEO of a Peloton Interactive