Peloton and Lululemon Announce a Landmark Partnership
Peloton and Lululemon, once rivals in the connected fitness arena, have now formed an alliance. Following this announcement, Peloton’s (PTON) stock rose by 13.3% post-trading on Wednesday, while Lululemon (LULU) saw a 0.3% bump.
Here are the key highlights of this partnership:
Exclusive Content and Apparel Partnership: Peloton will exclusively provide digital fitness content to Lululemon. In return, Lululemon steps up as Peloton’s main athletic-apparel ally. Some Peloton trainers will also spotlight Lululemon attire in sessions.
Strategic Collaboration: Starting October 11, joint-branded clothing from Lululemon will be sold both online and in Peloton stores in the U.S., U.K., and Canada. This will expand to other Peloton markets by March. By November 1, Lululemon Studio members will gain access to Peloton’s range of classes.
Lululemon’s Studio Mirror Phase-out: As part of the deal’s terms, Lululemon will discontinue its Studio Mirror, the brand’s response to Peloton’s fitness equipment-video pairing, by year’s end.
Regional Focus: The collaboration aims to cater to clients in North America, U.K., Germany, and Australia.
Lululemon’s Americas and Global Guest Innovation president, Celeste Burgoyne, mentioned that both brands envision promoting well-being via physical activity, and this alliance seeks to provide Lululemon’s members with a diverse and dynamic fitness content offering.
Background:
Lululemon’s acquisition of Mirror in 2020, a $500 million deal, brought an interactive fitness platform into its fold during the height of pandemic-induced home workouts. However, as lockdown measures eased and gyms resumed operations, Peloton faced challenges, including product recalls and leadership changes. The company’s shares plummeted over 90% since the end of 2020. Contrarily, Lululemon’s stock has been on an uptrend, buoyed by its quality offerings and positive financial projections.
