Thanks for your question! You are right – there are not a lot of barriers to this concept and that has been a main focus of Planet Fitness’ strategy from the beginning, hence the aggressive franchise model. The proliferation of these franchises allowed PF to gain scale and expand their number of locations very quickly very early on, deterring competitors from entering the market. At this point, it would be very difficult for a new entrant to compete as number of locations offered is a huge convenience factor for customers and therefore a big selling point. Furthermore, this national presence has created strong brand equity as consumers are familiar with the name and know they are receiving a quality experience. Hope this was helpful!
Kartik – really great post! I think Blue Apron is an interesting concept, but I worry that the current price point may be unsustainable. Many people who cook at home do so because it is cost prohibitive to dine at a restaurant or order take out. At $10 / meal, Blue Apron is not much lower than many take out options (especially given the wide variety of choices in major cities). Because of this, when I have used this service in the past with friends, it has been more of a ‘special occasion’ treat rather than an everyday convenience. I wonder how successful their subscription model is or if many others feel this is simply too expensive to spend on weekly groceries. Also, there are not a lot of barriers to entry and many other companies have begun offering similar products (Hello Chef, Plated, etc). How does Blue Apron plan to compete and differentiate itself in this increasingly crowded environment?
Jordan – really interesting read! You mentioned briefly in your post that people still feel a sense of community, despite spinning remotely. As a semi avid SoulCycler myself, I am worried that this community aspect is actually a key component of the experience and a bigger hurdle than anticipated. SoulCycle is just as much of a social setting as it is a workout class and I think that has been a key driver to their success. There is also a personal connection between riders and instructors – many are on a first name basis and will respond to call outs during class. How does Peleton plan to foster and build a community when there is no personal interaction?
Lucy – great analysis and really interesting read! I especially liked your closing questions – while I think SoulCycle has done an incredible job building their brand equity, I am worried about the sustainability of their immense growth as their core markets become saturated. I am also curious if you considered how the introduction of ClassPass (unlimited classes for ~$100 per month) is affecting their business model and pricing scheme. I know many other spin studios (including Flywheel and Swerve) and other class concepts (like Barrys) participate in ClassPass. While I believe SoulCycle brand loyalty is strong enough to create a loyal following when their classes are only a few dollars more than competitors, I do wonder if it will be enough to retain people when the economics are so drastically different. I would be curious to know what thought, if any, SoulCycle has given to its pricing model in light of this new disruption to the market.