Peloton, the US fitness brand, is set to make a “significant” increase in its advertising and marketing spend as it looks to become a public company.
The seven-year-old business, which appointed Lucky Generals’ sports creative shop Dark Horses as its first UK ad agency last year, filed for an initial public offering to the US Security and Exchange Commission yesterday (Tuesday).
Within its IPO prospectus, Peloton said that its growth strategy “contemplates a significant increase in our advertising and other marketing spending and expanding our retail showroom presence”.
Peloton spent $324m (£264m) on sales and marketing in the most recent fiscal year (ending 30 June), up 114% on the previous year.
In the UK, Dark Horses launched a £7m ad campaign last year called “Inside a class”, which aimed to bring to life the high-octane experience of a Peloton class.
The brand has sought to disrupt the fitness market with home workout using “smart” Peloton exercise bikes that connect to live spin classes.
However, within its IPO filing, Peloton identifies a competitive market being a significant risk factor, which suggests it will need to build a stronger brand going forward.
It added: “Maintaining, protecting and enhancing our brand depends largely on the success of our marketing efforts, ability to provide consistent, high-quality products, services, features, content and support, and our ability to successfully secure, maintain and defend our rights to use the ‘Peloton’ mark, our ‘P’ logo and other trademarks important to our brand.”
Peloton generated $915m in revenue last year, more than double the amount posted in 2018, but losses have also grown sharply. Peloton lost $195.6m overall in 2019, up from $47.9m in 2018.