What Peloton’s treadmill safety concerns could mean for brand’s momentum

Peloton has fallen under scrutiny from both consumers and regulators following accident claims and warnings of the brand’s treadmill product by the U.S. Consumer Product Safety Commission. Crisis experts say the fitness company’s response of publicly refuting the warning could be damaging to the brand. Over the weekend, the CPSC issued a warning to consumers about the “danger” of using Peloton’s Tread+ exercise machine, a $4,200 product involved in 39 accidents including the death of a child. The commission, which has been investigating the product since Peloton released news of the child’s death last month, urges consumers with children or pets at home to stop using the treadmill. In response, New York-based Peloton published a statement refuting the safety agency’s claims, calling them “inaccurate and misleading” and noting that there is “no reason to stop using the Tread+, as long as all warnings and safety instructions are followed.” Peloton also said it is open to working with the CPSC and suggested ways its customers say they keep children safe during home workouts, such as scheduling workouts during naps or at night when children are sleeping; using a baby gate; or having a spouse or partner watch children in another room. A Peloton spokeswoman did not respond to a request for further comment. While Peloton was already popular before the pandemic, its sales rose even more as exercise-hungry consumers turned to bikes and treadmills to get them through COVID lockdowns and other restrictions. To continue the momentum, at a time when recently reopened gyms are trying to lure back members, Peloton last week debuted an Olympics-themed campaign starring several well-known athletes including Usain Bolt and Allyson Felix. Yet the recent treadmill controversy could already be damaging the brand. On Monday morning, Peloton’s stock was down 9% to near $105. Karen Doyne, president of Doyne Strategies, a crisis communications firm, says it’s understandable for Peloton to feel singled-out when several treadmills are on the market and their dangers to children have been known for many years; in addition, a product recall would be “very, very expensive,” she adds. However, she says that publicly taking on the CPSC could be problematic for Peloton as the agency “can create a lot of pressure through traditional and social media, especially when children’s safety is concerned.” In addition, the CPSC has been under pressure in recent years to be tougher on companies following recall delays with Fisher-Price Rock ‘n Play sleeper, for example. “Brand reputation can take a significant hit for publicly opposing a recall or denying a defect identified by the government,” Doyne says. “It does not play well with consumers.” In addition, Peloton’s response could hurt the brand the most with some of its target customers—parents. “When Peloton first hit the market, they didn’t think of young professional moms with kids at home as the ideal people to be marketing to, but as the years have gone by that’s clearly part of who they are marketing to, and this is a big risk for them right now,” says Gene Grabowski, a partner at Washington, D.C.-based public relations and public affairs firm Kglobal. “Far better for them to have said, ‘We disagree, we think the product is safe but we’re going to re-examine this and take steps to make it safer.” Grabowski says such a response shows the brand has empathy—“Peloton has not showed empathy and that is the biggest mistake here.” On social media, some consumers called Peloton’s response to the safety concerns “tone-deaf.” Conversely, if Peloton wants to double-down on its tone deaf response to the CPSC, it could just embrace marketing the Peloton Tread+ to the child-free crowd. We’re probably the most likely to spend $4500 on a treadmill anyway.— Christina Warren (@film_girl) April 17, 2021 There is a video recording in the comment section and it is really disturbing to watch. I know Peloton has done a great job expanding their market size during the pandemic, but it has to and must to higher its safety standard #BCSTThttps://t.co/J3PMde33oj— Ziang Yan (@ZiangYan2) April 18, 2021 So glad I bought a @NordicTrack and not a @onepeloton Treadmill. So sad! #ifit #pelotontread 😥— Elle (@303Otter) April 18, 2021 Peloton weekly sales call: “Marketing has determined that adding the cost of a front safety cover will result in an unacceptable drop in revenue/profit curve above retail $4995”(Ford Pinto executives revisited)— normshift (@normshift) April 18, 2021 All the comments like “parents should watch their kids” ok yeah maybe, but the point is they don’t - the world is overflowing with idiots and mistakes happen. It absolutely should not be that easy for a treadmill to drag something underneath when the fix would be so easy.— Anomaly (@primalanomaly) April 18, 2021 Others blamed the accidents on treadmill users. Blaming Peloton for the treadmill incidents is like blaming rap music for children's violence. It's absurd. I keep the safely key away from the tread like the instructions say, and have never had a problem. This is entirely a user error. The CPSC is way out of line here.— Peter Shankman (@petershankman) April 17, 2021 If you leave a treadmill powered on with kids unsupervised this will happen on any treadmill. Don't cancel one brand...educate instead.— Chad Frias (@chadfrias) April 17, 2021 Doyne says that despite the issues around its treadmill, Peloton should continue to promote its brand in its current campaign. “Positive visibility is even more important to them at this point so moving ahead with it makes sense—but with one caveat: It’s not inconceivable that one or more of the athletes involved in the campaign might threaten to pull out over this issue or criticize the company publicly,” she says.

What Peloton’s treadmill safety concerns could mean for the brand’s momentum

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