Peloton will begin charging a one-time $95 activation fee for new subscribers who purchase used equipment, starting August 2024. This move comes as more consumers opt for secondhand Peloton Bikes and Treads through peer-to-peer platforms like Facebook Marketplace. The company saw a 16% year-over-year growth in subscribers using secondhand equipment during its fiscal fourth quarter.
Despite some criticism of Peloton’s machines as glorified clothes racks, the company views the influx of budget-conscious members from the secondary market as a unique revenue opportunity.
Ari Kimmelfeld, founder of Trade My Stuff, a startup that sells used Peloton equipment, estimates that there are around a million unused Peloton Bikes worldwide. Kimmelfeld believes the new activation fee won’t deter buyers, as secondhand equipment remains significantly cheaper and faster to obtain than new products.
Peloton emphasizes that the activation fee ensures new members receive a high-quality onboarding experience, including virtual custom fittings and access to a bike’s usage history. Additionally, Peloton offers discounts on accessories to these new members, aiming to enhance their overall experience with the platform.
