Listen: Peleton, Neil Patel, Eric Su discussed on Marketing School
"I've Eric Su and I'm Neil Patel today we're GonNa talk about how this one ad lost one company. A billion dollars billion with a B.. Neil you know what it is yes so this company is called Pelivan. They're a company that produces treadmills and bicycles. That you can have at home. They have really cool monitors and video lessons and you can work out with other people at your home. It's Kinda like a class environment but just in your home so if you're in the US and you've been to like a soul cycle is just like that but again in your home. Yeah so do you want to go over the Eric. I'll go over the the ad and by the way I mean we are both Peleton users and you know they have a subscription where they can basically help you afford it they help you finance it basically where you can pay like sixty four bucks or whatever are but so I use to bike neil has the treadmill and basically the way Peleton is seen and I've seen friends kind of send me snarky remarks before audits to grab what I post pictures of the workout view or whatever right basically Pelata is seen as something that is 'cause it's an expensive bike it's like twenty five hundred dollars or whatever whatever people see it as something to be used for the privilege or the people that are rich so the ad itself is basically it shows a young woman who's already very fit it and it shows are very nervous to be getting the Peleton as a gift right and it shows like you know her progressing through the year and then at the very end of the year her being very are grateful to her husband for buying Peleton for her and saying how it's changed your life right so the the irony before dive into a little more is that look look she's already fit short looks like she's already well off like very privileged and people are just kind of knocking the ad and because people are like you know if my husband ever bought me a Peleton on bike I would throw it right in the trash because like what it was my husband tried to say so there's a lot of backlash coming from it and basically what happened in that same week was that the the company actually lost a billion dollars in value because they are a publicly traded company so that is what happened so the question Neil is do we really think people people might say that this ad costume billion dollars at the end of the day do we think it's really one ad that drove this and we think the ad was that bad that's the question so what's funny is as for last Christmas about my wife Apollo Tom now the big difference is she was pregnant and she asked me to buy her Peleton. I don't think she needed one. And nor would I ever get my wife exercise equipment and you buy one to not only expensive but I I would never go and despite my wife any exercise equipment a gym pass or anything like that you know dislike. I married her for who she is whether she skinny you are not. I don't really care again. Married her for who she is. But what's funny is. I bought her as I mentioned because she wanted it and funny enough. It's it's been sitting in our living room for almost a technically pretty much a year now and I would say we've probably use it no more than ten times. If that may be fifteen undercounted to buy for discount yet you can buy it for discount on the but when you look at it and you think about this machine gene or even Peleton as a company I don't think the commercials really GonNa hurt their performance. Some people may have opinion saying that sexist. Some people may not. I'm not here to say it is sexist or not. I'm here to more so talk about. If they actually hurt the revenue you can learn about it. I honestly don't think I heard the revenue just like you know how facebook had had all these privacy issues in government hearings and fines didn't really hurt their revenue. They're still growing just because you some backlash it doesn't mean you're not gonNa when I grow any more as she bet what's going to happen from the ad and I know this may sound crazy to some of you. That bad press is getting Peleton more in the limelight. I bet you some people are like. Oh this is what this company does. LemMe buy the product. Yeah I think exactly the same way I think in this case the press is so it might be a little negative but to to me. It's almost more on the neutral side. I don't think it's like really good. I don't think it's really bad either. Actually did end up sharing that added with a couple of people so I think at this point. I think it's positive. Press Press. And by the way if you look at what Peleton's do as a company similar facebook before in the very beginning when they first ipod they're stuck demolished he got destroyed and it was very tumultuous. It's time for them. I remember Amazon was Tumultuous Times in the beginning the way I look at Peleton as a company if you look at where they're going like a right now the users they have even though they're more or affluent because their their product were expensive. The treadmill I think is a couple thousand dollars the bikes a couple of thousand dollars. The have a monthly subscription so they have monthly recurring revenue. This is from a business perspective. They have SAS revenue and their users are actually very sticky. Think about it you pay thirty nine dollars a month instead of paying thirty dollars per class for like a soul cycle which is a spin class and that's a pretty good deal now. The other thing is they have cheaper versions coming out. They're gonNA have a rowing machine coming out that have cheaper bikes coming out. So they are starting like like when you think about Tesla they start what really expensive model first and then they start going to the masses right and so you think about facebook. They started with Harvard. I and they started with elite colleges. College is and then they started branching out from there so the way I look at it Peleton right now the fact that they lost a total value. Recently I'm not an expert stock picker or anything like that but unlike mad if I really likes hello todd has a stock and have you know an investor. That's really looked into it. It might be worth it for the long term. I think I can see them doing amazing things for long term so I do think they lost lost a ton of money. A lot of people claim that Peleton lost the billion dollar market cap because of that Ad. Neil doesn't think so either bill at the end of the day bad had press. Yes it may sound like. It's the end of the world. I've even had bad press in the past some of my previous companies. Technically just one big one I remember I gotTA FTC investigation investigation a class action lawsuit I pass the FTC investigation with flying colors. It was just some journalists. wrote something that was inaccurate they did a retraction but known as a retraction and the class action lawsuit funny enough in America. It's cheaper to sometime. Settled it because insurance pays for the cost versus fighting and winning it. 'cause then you have to pay your own legal fees but even then funny enough. The lawsuit did hurt the company but a lot of the bad press at the same time was also getting new customers customers as well so I've seen it work in a positive way not just a negative way when you get bad press now if you WANNA leverage some creative marketing getting strategies that won't necessarily get you negative press began. 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