Peloton pissed off customers after announcing a new $95 activation fee for anyone in the US or Canada who buys a secondhand bike on Facebook Marketplace or Craigslist (or any other secondhand marketplaces). This fee is in addition to the $12.99/month or $24/month subscription required to operate the bike after purchasing it.
The activation fee includes:
- $25 spare parts credit
- 50% off coupon for up to three pairs of Peloton cycling shoes
- A Peloton Bike mat
- A virtual onboarding session
- A hot fresh desperation sandwich from Peloton
Peloton wrote in a letter to shareholders that it wants to “ensure these new Members receive the same high-quality onboarding experience Peloton is known for” and that the new activation fee will be “a source of incremental revenue and gross profit” for the company, which will help it improve the “fitness experience” for members.
Sounds great Peloton. Add more value and make it optional!
Peloton owners criticized the move:
- A Reddit user said, “It'll get to the point where people selling their equipment will offer to cover the activation fee to incentivize potential buyers. So ultimately (eventually) the original owner will be the one eating the cost.”
- Longtime Peloton user Sarah Haeck told Business Insider, “It makes me sad to see it become more of a money grab for those trying to improve their health.”
- Commenters on a Facebook post called the move “greedy,” a “really bad move,” a “bad look, kind of desperate,” and gave the new fee “two thumbs down!”
The decision comes amid Peloton's ongoing effort to correct a major post-pandemic share decline. PTON was trading between $130 – $168 per share during its peak in 2020-2021, but now trades between $2-5 per share.
In the last couple of years, the company has gone through multiple rounds of job cuts, a recall of 2M bikes, and two CEOs.
Maybe they can hire Brian Niccol for a turnaround, and he can virtually commute 1,000 miles on his Peloton to get to work each day.