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Ideas. Insights. Inspiration.

Peloton's Perplexing Price Increase

Peloton is raising the price of its app subscription.

Well, technically, they're charging the same $16.99 (+HST) price I've been paying but giving me less... and that's the same as a price increase in my books.

What am I losing?

Technically, nothing... because my wife is the only one who uses the app.

But today, she can do as many "cardio equipment classes" per month as she wants, and after December 5th, she'll only be able to do three per month.

I have a few questions about the communication I received via email today, a screenshot of which you can find at the bottom of this post.

1. Three classes per MONTH?

In this case, three is a really odd number because it's not even one class per week.

But perhaps that's the point.

Is Peloton banking on the fact that most people who use the app with non-Peloton equipment (like my wife) will decide that three classes per month isn't enough and upgrade to the $30/month plan instead of cancelling their subscription?

I wouldn't take that bet: the new price is almost DOUBLE what I'm currently paying, with zero incremental benefits.

Did Peloton go deep into their user data and notice that most app subscribers are mostly using non-equipment classes before deciding to make this change?

If I was a Peloton shareholder, I'd certainly hope so.

2. A SIX-MONTH notice period?

Most companies arguably don't provide enough notice about upcoming changes to their subscription plans, so kudos to Peloton for letting me know today about a change that's happening more than six months from now, on December 5th.