What makes Peloton work?
The mental models behind Peloton's massive success.
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Peloton has a cult-like following. I never really understood why a stationary bike is a big deal until my wife bought one in 2020. Once I started using it, I finally got it. Slowly but eventually I became addicted to the experience.
I noticed that Peloton has leveraged some key mental models that shape human behavior. Instead of asking people to design their behavior around the technology, they designed the technology around human behavior.
In today’s article, I have identified a list of mental models that turned a stationary bike into a fitness sensation with a market cap of over $44.38 billion. Let’s dive in!
Social Facilitation
In 1898 Norman Triplett conducted a study where he observed that cyclists who were racing against each other seemed to perform better than the ones who were racing a clock. This phenomenon is now referred to as the co-action effect or social facilitation. Studies have shown that people tend to exert more effort in the presence of others, whether that presence is real or implied.
Social facilitation refers to the enhanced performance of people in the presence of others (audience, competitor, co-actor) compared to the performance when alone.
The peloton leaderboard leverages this idea to display the list of people who are currently working out along with you. It also shows your rank in comparison to the rest of the riders.
If that was not enough, Peloton has a feature where you can give a hi-five to someone who has achieved a riding milestone (like the 20th ride or 7 days in a row). I must say that even though it sounds cheesy, you feel good when fitmom89 gives you a high five in recognition of your hard work.
We, humans, are social animals. We thrive when we get acknowledged and appreciated by fellow members of the group. Peloton-1, Treadmill-0.
Paradox of Choice
We think we love options but the truth is that we freeze in front of too many options. When was the last right the dinner menu at a restaurant made your head spin? Making a choice is a lot of work. Our brains did not evolve in a world where choices are abundant. Peloton understands this.
They have over 10,000 on-demand workout videos available but their algorithm recommends the ones that you may like better. They analyze your previous workout and selects a handful of recommended workouts in their daily picks section. The last thing my 6 am groggy self wants to do is to dig out the “best” workout from their massive collection.
Halo Effect
Halo effect is the tendency for positive impressions of a person, company, brand, or product in one area to positively influence one's opinion or feelings in other areas.
The list of celebrities who are peloton riders is getting longer day by day. It includes people like Beyonce, Ellen DeGeneres, Jimmy Fallon, Roger Federer, Usain Bolt, Richard Branson, Hugh Jackman, just to name a few.
The stardust of these celebrities has definitely rubbed off on the Peloton brand. People consider Pelton as the gold standard compared to copycat bikes like Soul Cycle. It almost becomes a signaling device to boost your social status.
Zeigarnik Effect
We don’t like leaving things half done. We have a bias to hold on to incomplete tasks in our mental space until we get them done. This is called the Zeigarnik effect. Peloton takes advantage of this mental model through gamification of the riding streaks.
The Peloton dashboard shows your riding streaks and gives you badges and rewards for completing continuous streaks of riding days. (5-day streak, 7-day streak, 30-day streak, etc.) Once you start earning those badges, you are motivated to push harder so that you get the next one and the one after that. (even though these are completely imaginary ones).
Authority Bias
At Peloton, the instructors are not just a cog in the machine. They are the real superstars. From the beginning, Peloton focused on poaching the underrated superstars from the local spin studios in NY. Their energy is truly contagious.
Out tribal minds are wired to seek authority. It was an evolutionary mechanism designed to increase our chances of survival in the wild by following the instructions of people who know better than us. The instructors look like greek gods and goddesses with six-pack abs and boundless energy, pushing you to give your best.
Take, for example, Alex Touissant. The story goes that he was recruited by Peloton after their chief content officer, Fred Klein, took one of Toussaint's classes at Flywheel, a NY spin studio, and was awe-struck by Alex’s energy and passion. He comes from a military background and his passion is contagious.
Leverage
“Let’s not think about it as a fitness facility with cameras,” John Foley, the founder of Peloton and its chief executive, once told his staff. “Let’s think about it as a television streaming facility filming fitness content.”- John Foley, CEO of Peloton.
Peloton is not in the business of fitness. They are in the business of content. By creating filming studios with trainers who are elevated to the status of celebrities, Peloton is blurring the line between exercise and entertainment.
By creating an endless volume of content, Peloton is now able to provide an enormous variety of workout that caters to its broad audience. Once a video asset is created, it can be leveraged for an infinite number of replays vs paying an instructor for each session.
Peloton’s success story is a testimonial to the power of applying the right mental models to design your product or service. Good mental models give you clarity about how things and people behave in the world. So, instead of fighting against reality, you can ride it’s waves to massive success.
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Footnotes
McLeod, S. A. (2011, October 24). Social facilitation. Simply Psychology. https://www.simplypsychology.org/Social-Facilitation.html
The paradox of Choice by Barry Schwartz https://www.swarthmore.edu/SocSci/bschwar1/Choice%20Chapter.Revised.pdf
Great article Deepu. It was interesting to learn that the business model focuses on entertainment and not fitness.
Can you recommend any good books on mental models?
Keep up the great content!