In March, exercise equipment and media company Peloton released a new treadmill, the Tread+. That treadmill, according to the U.S. Consumer Product Safety Commission, had an unusual design that could lead to negative consequences. The company quickly pushed back against those claims.
Soon after, reports surfaced of numerous injuries involving the treadmill and even a tragic death, and Peloton released a statement to members stating that the treadmills were safe for exercise use, but that it should be kept away from children and pets. When those reports surfaced, the Consumer Product Safety Commission also released a graphic video of a young boy being trapped under the Peloton equipment and struggling to free himself, with the regulatory commission urging Peloton to recall the treadmills.
Once again, Peloton pushed back against the recommendations of recall until a report of the death of a young child involving a treadmill last month.
When the first reports of injuries surfaced, Peloton CEO John Foley posted a statement to members expressing the importance of keeping the exercise equipment away from young family members and pets, and even keeping it locked up when not in use. However, out of respect for the families involved, the company didn’t provide any additional information regarding the accidents.
This was a positive step for Peloton, given that whenever a tragedy occurs that’s tied to a brand, it’s best to first speak directly to the company’s audience and community.
However, the fact that the equipment was recalled months later, after numerous suggestions from the regulatory body, doesn’t help the company’s public image.
In total, more than 70 safety incidents have been reported in connection with the company, reports involving people and pets, as well as objects being pulled under the exercise equipment due to its unusual design. And even despite a tragic death, the company kept pushing back against suggestions.
In a new statement, Foley said the company made “a mistake” in not agreeing with the Consumer Product Safety Commission’s initial suggestion to recall the treadmills, and acknowledged the mistake of not properly engaging with regulators from the very beginning.
However, at that point it was a little too late for the statement. The public was quick to criticize Peloton and its actions. Many began to claim that Peloton announced the recall only after company shares decreased, and after a number of similar accidents occurred in the preceding weeks.
At present, the damage that the crisis has had to Peloton’s reputation isn’t completely clear. However, the company is now recalling more than 100,000 treadmills around the country, which were estimated to constitute about 2.2 percent of Peloton sales this year. The recall itself is going to result in significant financial costs for the company, as well as operational disruption.
Although the home fitness industry is going to continue to grow, this event is going to have a significant impact on Peloton’s reputation, and serves as a lesson for brands. The lesson is that when a serious issue involving a product occurs, companies should first come to a consensus with regulators and then make public statements, especially when safety is involved.