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Figure 1. Negative controversy can make a brand very visible, as was the case with Peloton's holiday ad.[\/caption]\r\n\r\n Figure 1. Negative controversy can make a brand very visible, as was the case with Peloton's holiday ad.[\/caption]\r\n\r\nPeloton started in 2012 with the mission to \u201cuse technology and design to connect the world through fitness, empowering people to be the best version of themselves anywhere, anytime.\u201d[footnote]\u201cThe Peloton Story,\u201d Peloton, accessed June 30, 2022, https:\/\/www.onepeloton.com\/company[\/footnote] In 2019, Peloton released a holiday television ad that drew a lot of attention. The ad opens with a mother and daughter walking down a set of stairs to open Christmas presents. You can see the snow outside through the windows of the house. At the bottom of the stairs is her husband waiting with a Christmas gift.<\/p>\r\n
\u201cA PELOTON?!?\u201d she shrieks\u2014but it isn\u2019t immediately clear if she is happy with the gift. The commercial progresses with the mother documenting her fitness journey. She rides after work. She rides early in the morning. She rides through the seasons as you watch them change through the windows of the house. As the commercial comes to an end, the woman shares her journey with her husband. \u201cA year ago, I didn\u2019t realize how much this would change me,\u201d she says, now a true believer. After her year-long journey and her new \u201cfit\u201d state, she thanks her husband for the gift and how it transformed her.<\/p>\r\n
Consumers immediately took to social media to accuse Peloton of promoting a negative body image, economic privilege, and archaic marital relationships. The controversial ad sparked a significant spike in social media engagement. The brand and the ad were widely publicized in the media. The ad and the controversy definitely produced significant brand awareness and an intense interest in the benefits of using a Peloton.<\/p>\r\n
Once the controversy died down, Peloton was a well-known brand name. And with the lockdowns that came with the COVID-19 pandemic, consumers around the world were seeking options for in-home exercise. Peloton was poised to become the market leader with a reputation as a premier means of in-home workouts.<\/p>\r\n
Much of Peloton\u2019s success is a result of its robust integrated marketing strategy. Consumers learn about Peloton through a variety of methods: YouTube ads, television commercials, mall kiosks, social media posts, and web content. Though the organization does its best to develop its promotional messages, its best marketing strategy is the excellent word of mouth and rave reviews from all its loyal and satisfied customers.<\/p>\r\n
Throughout 2020 and into 2021, during the height of the pandemic, Peloton experienced a 172 percent increase in sales.[footnote]Jordan Valinsky, \u201cPeloton Sales Surge 172% as Pandemic Bolsters Home Fitness Industry,\u201d CNN Business, Cable News Network, September 11, 2020, https:\/\/www.cnn.com\/2020\/09\/11\/business\/peloton-stock-earnings\/index.html[\/footnote] But quick growth can create other problems. As Peloton\u2019s popularity exploded during the COVID-19 pandemic, management issues began to surface. In February of 2022, Peloton saw a 73 percent drop in its stock price, which led to the ousting of founding partner and CEO John Foley.[footnote]Ian Thomas, \u201cThe Fall of Peloton\u2019s John Foley and the Stock Market\u2019s Big Founder Problem,\u201d CNBC, updated February 14, 2022, https:\/\/www.cnbc.com\/2022\/02\/12\/the-fall-of-pelotons-john-foley-and-the-markets-big-founder-problem.html[\/footnote] In response, Peloton implemented a leadership change with a new CEO,[footnote]Shivansh Tiwary, \u201cPeloton Raises 2025 Core Profit Forecast as Cost Cuts, Subscription Push Pay Off,\u201d Reuters, February 6, 2025, https:\/\/www.reuters.com\/business\/retail-consumer\/peloton-raises-2025-core-profit-forecast-cost-cuts-subscription-push-pay-off-2025-02-06\/[\/footnote] expanded product offerings with a digital app[footnote]Victoria Song, \u201cPeloton\u2019s New Audio-Based App Is like an Invisible Strength Coach,\u201d The Verge, December 4, 2024, https:\/\/www.theverge.com\/2024\/12\/4\/24313321\/peloton-strength-plus-app-strength-training[\/footnote] and equipment at a lower price point, and increased retail partnerships with stores like Costco.[footnote]Cathy Bussewitz, \u201cPeloton Plans to Sell Its Deluxe Stationary Bike at Costco to Reach Holiday Shoppers,\u201d AP News, October 22, 2024, https:\/\/apnews.com\/article\/peloton-costco-bike-holiday-sales-3f372f05b7af411f63afb75b7718bc5e[\/footnote]<\/p>\r\n
While Peloton has faced ups and downs, the brand\u2019s ability to turn controversy into awareness remains a valuable lesson in marketing. A single viral moment, even one that sparks backlash, can become a catalyst for growth if a company is prepared to seize the opportunity. However, the publicity alone will not propel sales without a sound marketing strategy.<\/p>\r\n The notion of \"bad publicity\" refers to negative attention or controversy surrounding a person, brand, or organization that can potentially harm their reputation or public perception. However, it is commonly said that \"there is no such thing as bad publicity.\" Is this true? While for Peloton, controversy elevated their brand recognition. However, negative publicity can lead to loss of trust and credibility. Just look at the examples of Volkswagen's defeat device scandal and Boeing's 737MAX plane crashes. Those events were covered widely in the media and the publicity was extremely negative.<\/p>\r\n Sometimes it's hard to say whether controversy is good or bad for business. Target quietly pulled some merchandise from stores in May 2023 ahead of Pride month because store employees received threats.[footnote]AP NEWS. \u201cWhy Is Target Pulling Some Pride Merch? The Retailer\u2019s Response to Hostile Backlash, Explained,\u201d May 24, 2023. https:\/\/apnews.com\/article\/target-pride-collection-lgbtq-merchandise-backlash-cf4a19844579e6041c6938b13568e17c[\/footnote] While some customers may be disappointed that pulling the merchandise is insensitive to the LGBTQ+ community, Target explained they were concerned for employee welfare.[\/hidden-answer]<\/p>\r\n<\/section>\r\nIs all publicity good for businesses?<\/h3>\r\n
\r\n[reveal-answer q=\"294281\"]Click to Show Sample Answer[\/reveal-answer]
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