Peloton Loses $942 Million In Value In One Day After Controversial Holiday Advert
With the festive season well and truly underway, you’d better believe companies are doing everything in their power to have their Christmas advert crowned number one.
One company who might regret making such a memorable advert, though, is Peloton, whose recent commercial sparked such a backlash the company lost a massive $942 million in value in a single day.
You can watch Peloton’s advert below:
The 30-second advert, which sees a man giving his wife one of Peloton’s stationary bikes as a Christmas present, was widely shared online this week – but for all the wrong reasons.
Upon seeing the bike in front of her large Christmas tree and other presents, the woman exclaims: ‘a Peloton?’. The viewer then watches her as she creates a video diary during her first year of riding the stationary bike.
The ad ends with the woman and her husband sitting on the couch, watching her indoor cycling video diary – at the end of which she thanks him for giving her the bike. ‘I didn’t realise how much this would change me,’ she says.
Since the advert went viral, the exercise bike company has been branded ‘sexist’ and ‘classist’ by social media users, who compared it to the dystopian television series Black Mirror.
It wasn’t lost on anybody that this wasn’t a Christmas advert many could relate to; a Peloton bike costs $2,245, with membership for the company’s signature interactive classes – which the woman in the advert was taking – costing $39 a month.
Critics also pointed out that the woman in the advert is already slim at the start, and the implication that her partner thinks she needs to get fitter and lose weight is both patronising and damaging.
As the backlash grew, shares of Peloton fell more than 9% on Tuesday, December 3, erasing nearly $942 million from the company’s market value in a single day – bringing its market cap to approximately $9.4 billion.
Despite speculation about the stock price drop and rumours the advert could be taken off the air, Peloton said yesterday it had received a lot of support for the ad and it stands firmly behind it.
In an email the company shared with The New York Times, a 60-year-old woman named Tami said the commercial ‘inspired’ her, saying she could relate to the woman and thanking Peloton for acknowledging that ‘EVERYONE needs to be healthy, regardless of how you look’.
The company said they do not believe any stock movement was tied to the backlash received as a result of the holiday ad, although Justin Patterson, an analyst at Raymond James, disagrees.
He said the adverse reaction to the advert and Peloton’s response are ‘worth monitoring’, adding that he believes the advert might have to be taken off the air before the controversy dies down.
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CreditsPeloton/YouTube and 1 other
The New York Times