In a surprising move, fitness giants Peloton and Lululemon have announced a five-year “strategic global partnership,” signaling the end of their years-long feud. As part of the deal, Lululemon will cease production of its struggling $995 Fitness Mirror and instead make Peloton classes available on Mirror, as well as on the Lululemon Studio app. Meanwhile, Peloton will discontinue its fitness clothing private label and Lululemon will take over production of Peloton-branded fitness clothing. The announcement sent shares of Peloton soaring 14% in premarket trading, highlighting the impact of the Lululemon name in the athletic wear industry. This partnership adds to the growing list of brand frenemies coming together to mutually benefit from their collaboration.
Peloton and Lululemon Announce Strategic Global Partnership
Read more about the Latest Money News
Overview of the Partnership
Peloton and Lululemon have recently announced a five-year strategic global partnership. This partnership is expected to be a mutually beneficial collaboration between the two companies, bringing together their expertise and strengths in the fitness and athleisure industries.
Background of Peloton and Lululemon
Peloton is a leading fitness platform known for its connected fitness products, including exercise bikes and treadmills, as well as its immersive workout classes. Lululemon, on the other hand, is a well-known athletic apparel brand that offers high-quality and stylish workout clothing. Both companies have gained significant traction in the fitness industry and have a strong customer base.
Read more about the Latest Money News
Previous Feud between Peloton and Lululemon
Peloton and Lululemon had a brief partnership in 2016, which lasted only one year. However, after the contract ended, Peloton decided to launch its own clothing line that resembled Lululemon’s styles. This move led to a feud between the two companies, with Lululemon accusing Peloton of copying its designs. In 2021, Lululemon sent Peloton a cease-and-desist letter, and a lawsuit followed. The legal dispute was resolved last year.
Details of the Partnership
As part of the partnership, Lululemon will discontinue its Fitness Mirror production, which has been a challenging product for the company. The connected fitness industry has faced struggles post-COVID pandemic, with users demanding more variety in fitness content. Lululemon plans to end Mirror hardware sales this year and make the app inaccessible to new users by the end of 2023.
Instead of the Fitness Mirror, Peloton classes will be made available on the Mirror platform and the Lululemon Studio app. This integration will enhance the fitness content offering for users, providing them with diverse workout options. The partnership aims to improve the overall fitness experience for Peloton and Lululemon customers.
Impact on Lululemon’s Fitness Mirror
The decision to discontinue Fitness Mirror production by Lululemon is a result of the challenges faced by the connected fitness industry post-COVID pandemic. Users have shown a preference for varied fitness content, leading to a decrease in demand for hardware-focused products like the Fitness Mirror. As a result, Lululemon has decided to focus on providing workout content through its app and integrating Peloton classes to meet the evolving needs of its customers.
This discontinuation of Fitness Mirror hardware sales and app accessibility for new users will allow Lululemon to allocate resources towards enhancing its workout content offerings through partnerships like the one with Peloton.
Availability of Peloton Classes on Mirror and Lululemon Studio App
The partnership will bring Peloton’s popular classes to the Mirror platform and the Lululemon Studio app. This integration will provide users with a wider range of workout options, allowing them to access Peloton’s renowned fitness content directly through the Mirror and Lululemon apps.
By offering diverse workout options to users, the partnership aims to meet the demands of customers who are seeking more variety in their fitness routines. This collaboration between Peloton and Lululemon will benefit both companies’ customers by providing them with a comprehensive fitness experience.
End of Peloton’s Fitness Clothing Private Label
As part of the partnership, Peloton will discontinue its private label for fitness clothing. Instead, Lululemon will take on the role of manufacturing partner and produce Peloton-branded fitness clothing. This collaboration will bring Peloton-branded fitness clothing to Lululemon stores, starting from October 11.
This strategic decision by Peloton reflects its focus on partnering with a well-established and respected brand like Lululemon to ensure high-quality and stylish fitness clothing for its customers. By leveraging Lululemon’s manufacturing expertise, Peloton aims to enhance its overall brand offering.
Lululemon’s Manufacturing of Peloton-Branded Fitness Clothing
Lululemon has been chosen as the manufacturing partner for Peloton’s fitness clothing line. As a leading athletic apparel brand, Lululemon has a strong reputation for producing high-quality and fashionable activewear that resonates with fitness enthusiasts.
With this partnership, Lululemon will have the opportunity to manufacture Peloton-branded fitness clothing, showcasing its manufacturing capabilities and expanding its product offerings. For Peloton, collaborating with Lululemon ensures that its customers have access to premium fitness apparel that aligns with their workout experience.
Reaction from Investors
The announcement of the strategic partnership between Peloton and Lululemon has had a positive impact on investors’ sentiment. Following the news, Peloton’s shares saw a 14% increase in premarket trading, indicating the significance of the association with Lululemon for the athletic wear market.
Investors recognize the value of partnerships in the fitness and athleisure industries, and the collaboration between Peloton and Lululemon is seen as a strategic move to strengthen both companies’ positions and enhance their offerings to customers.
Comparison with Other Brand Partnerships
The partnership between Peloton and Lululemon is not the first instance of feuding brands coming together for mutual benefit. Other examples include Merck and Pfizer collaborating on groundbreaking cancer studies and Microsoft partnering with Apple to improve user-friendly technologies.
However, it is worth noting that not all brand partnerships see success. Burger King’s failed attempt to partner with McDonald’s for a joint sandwich highlights the challenges and complexities involved in such collaborations. The Peloton and Lululemon partnership, on the other hand, seems to be a promising venture, bringing together two industry leaders to provide an enhanced fitness experience for their customers.
In conclusion, the strategic global partnership between Peloton and Lululemon marks an important collaboration in the fitness and athleisure industries. By leveraging each other’s strengths, both companies aim to enhance their offerings to customers and capitalize on the evolving demands of the market. This partnership reflects the trend of feuding brands coming together for mutual benefit and has garnered positive reactions from investors. As the partnership unfolds, it will be interesting to see the impact on the fitness industry and the perceptions of customers.
