Lululemon Wants To Get People Back into the Gym (Kind Of) – TheStreet

With the end of the pandemic bringing people back to gyms and pools, the $1,000-plus Peloton  (PTON) bike is growing rusty while fancy memberships to online workout classes are getting significantly less use.
That may not be the full picture, but, for companies that invested millions into developing interactive online workout programs, this shifting of workout preferences can still pose a serious problem — after turbocharging in the early days of the pandemic, sign-ups for online classes and other virtual fitness programs have been dropping for months.
At a presentation in New York, Canadian athleisure brand Lululemon  (LULU)  announced the launch of a new paid membership program called Lululemon Studio. At $39 a month, the program will give members access to over 10,000 various fitness and exercise classes in a best-of-both-worlds approach.
The hybrid model means that some will be in-person while others will be available virtually through the app or Lululemon's smart gym mirror.
The mirror, which goes under the name of Lululemon Studio Mirror, normally costs $1,495 (to promote the new membership, it will be sold for a $795 for a limited time) and is required to stream the virtual classes offered through the membership.
The in-person component will give members access to classes in studios like YogaSix, Pure Barre, Rumble and Dogpound as well as members-only events in Lululemon stores near where one lives.
"Our guests' fitness needs have evolved and Lululemon Studio is solving for them by providing members with access to fitness content from our world-class trainers and studio partners at home, on the go and live in studios around North America," Lululemon's Chief Brand Officer Nikki Neuburger says in a statement. "Lululemon Studio unlocks the versatility our community has told us they are looking for now."
Along with being another opportunity to promote what can be done through the Mirror, Lululemon Studio is a way to keep people who are increasingly going to the gym or in-person fitness classes signed up to virtual offerings.
While a McKinsey analysis found that 70% of fitness companies planned to continue offering online workout options long after the pandemic eased, 95% of those using such programs reported missing one or several components of in-person workouts.
Demand for virtual fitness classes is not expected to go down anytime soon — the online fitness market is expected to grow at a CAGR of $79.87 billion by 2026 — but the return of in-person classes mean that studios need to draw in customers by either convenience or something they can't get anywhere else.
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Even though the convenience of being able to fit online classes into one's schedule keep many people signing up for virtual fitness classes, equally strong demand for in-person events mean that hybrid models like the ones developed by Lululemon may be more sustainable in the long-term.
"As vaccines roll out and pandemic restrictions ease, we have observed consumers return to gyms and studios in those markets while continuing to use alternatives to the gym," McKinsey analysts Eric Falardeau, John Glynn, and Olga Ostromecka write in their 2021 report. "In short, consumers are finding ways to continue to take part in fitness, and industry participants will need to figure out how best to serve consumers who now use a portfolio of options."


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