Critically appraise mission statements by considering direction, motivation, stakeholder communication, differentiation, realism, flexibility and strategic value.
Extract A The Peloton Business Model Peloton, founded in 2012, manufactures and sells two products for customers to use at home when exercising. The first is the Peloton Bike, an indoor cycle with a touchscreen monitor and a starting price of $2 245. The second is the Peloton Treadmill; this has a touchscreen monitor and a starting price of $4295.
Peloton customers pay a monthly subscription of $39. This gives them access to exclusive virtual sport content streamed directly to their monitors where they can compete against other subscribers. If they do not want to compete against others, they can follow a class from the Peloton large fitness and sport library.
The Peloton headquarters is in New York. It has become the largest interactive fitness business in the world and in 2019 became a public limited company. It has customers in the US, Canada, UK and Germany and has recently expanded into Australia.
There has been a huge growth in virtual fitness classes as fewer people attend traditional gyms. This has led to an increase of 153\% in Peloton's revenue since March 2020.
Extract B Selected financial data for Peloton 2020 and 2021
Extract C Peloton's mission statement Peloton uses technology and design to connect the world through fitness, empowering people to be the best version of themselves anywhere, anytime.
Extract D Peloton completes takeover of Precor for $420m cash in April 2021 Precor is one of the largest global commercial fitness equipment manufacturers with a large number of sales in the US. Its fitness equipment can be found in hotels, universities and businesses in 90 countries.
With this takeover, Peloton expands its US manufacturing capacity and is able to increase its research and development capabilities with Precor's highly-skilled employees. This is expected to speed up Peloton's penetration of the global commercial market.
Extract E Peloton recalling all treadmills In May 2021, Peloton announced recalls of 126,000 treadmills over safety concerns. The announcement marked a major reversal of Peloton's initial reaction. It comes after weeks of discussions with the US Consumer Product Safety Commission (CPSC) over reports of faults with the Peloton Treadmill.
In a statement, Peloton apologised for not acting more quickly after reports of one death and dozens of injuries. "I want to be clear; Peloton made a mistake in our initial response to the CPSC's request that we recall the Peloton Treadmill," CEO John Foley said. "We should have listened to them from the outset. For that, I apologise."
Peloton shares closed nearly 15\% down. This wiped $4.1bn from Peloton's market value.
Peloton share price February-August 2021
Extract C Peloton's mission statement Peloton uses technology and design to connect the world through fitness, empowering people to be the best version of themselves anywhere, anytime.
Using Extract C, discuss the possible benefits for Peloton of having a mission
statement.