Cult Jokes Aside, Why SoulCycle Is Laughing All The Way To The Bank

While every retailer yearns for that dedicated, fanatical customer willing to tattoo the brand logo on their forearm and/or sleep outside in a makeshift tent for three days to be among the first to snag a new product, there are only a tiny handful that actually achieve that retail nirvana. That something that transcends loyalty to something that more closely resembles true love or religious devotion.

Which leads us to SoulCycle – an emerging boutique fitness enterprise that after a very short time seems poised to be the latest brand to scale the gap between building loyal customers and creating diehard believers.

"The instructor made her rock star entrance with her long curls cascading around her incredibly toned arms. She was like a TV evangelist…but way better-looking,” one Style Editor wrote about her first-but-certainly-not-last SoulCycle experience which she described as losing her SoulCycle “virginity.”

SoulCycle, for those of you who haven’t had the life-changing experience yet – is a boutique fitness studio focused on one and only one thing: spinning. But it’s not just any spinning class. SoulCycle studios are illuminated by candlelight, and further accentuated by rock music. The studio’s unique ambiance surrounds the studio’s meticulously organized yellow bicycles. Seating in the studio is arranged by seniority. But the center of the experience – the secret sauce – are the instructors, who, according to SoulCycle devotees, are part “drill sergeant,” “part therapist” with high voltage personalities, which is why SoulCycle customers would rather spin with them than anyone else.

Now although SoulCycle COO Melanie Whelan, speaking to MPD CEO Karen Webster in a recent ShopTalk podcast, didn’t quite use those descriptors when discussing the distinct relationships their instructors build with their clients – she did agree that the uniqueness of the relationship was central.

"We have often said that if our users could climb through the computer to spend more time with our instructors after class, they absolutely would,” Whelan told Webster. “From the beginning Julie and Elizabeth [SoulCycle’s co-founders Elizabeth Cutler and Julie Rice] wanted SoulCycle to be about finding joy in fitness,” Whelan recounted. “They felt there was no place [a consumer] could go to have a workout where they could mix the physical and emotional in fitness. They wanted to create a place in the world where the fitness experience was one they could look forward to and that would leave [the consumer] changed physically and mentally."

The instructors – with their large and charismatic personalities, Whelan told Webster, are central to the brand, paradoxically perhaps because they are independent.

"Our instructors are the heart and the souls of SoulCycle. We say that we like to provide freedom within a framework,” Whelan explained. “We train them on our SoulCycle voice and method and we tell them our messaging and brand – but we never want to limit their creativity because that is where the magic happens and keeps people coming back."

Or, rather, as Whelan noted, a big part of what keeps riders coming back. A lot of the magic also happens because of SoulCycle’s boutique fitness model. A little under a decade ago when the concept first launched, most spinning enthusiasts were part of a spin class at their local gym – an experience that turned out to be ripe for disruption.

"Group fitness classes were not efficient in any way,” Whelan said. “The only way to go was put your name down 60 minutes ahead of time which meant that a workout that was supposed to take an hour turned into a 2 hour experience. Busy working moms didn’t want something that was this inefficient."

So SoulCycle built a better option through a first of its kind proprietary booking system for fitness classes – that allowed users to sign up for their spinning classes and hold their spot by paying for it — how else — digitally.  The cost for a 45 minute workout session? $34.

Something that has turned out to be part of what keeps spinners sticky and instructors motivated.

"When you pay $34 to come and work out for 45 minutes, you bring your best game to every workout,” Whelan noted. “And that collected energy  – what’s going on in the spinning studio – is that everybody really brings their best self to the bike. That,  combined with the inspirational coaching by the instructor, produces a one of a kind experience every single time."

Also a one-of-a-kind experience, Webster noted, though perhaps not in a way that SoulCycle is looking for – is the way that consumers sign up for class. That’s first-come, first serve, once the window for sign up opens. The classes, particularly those with popular instructors in major markets, can fill up fast – literally within seconds. Which leads to much sadness and even a little frustration at times, in the user base – especially among long-time devotees who get edged out by new enthusiasts.

"This is one of the reasons and great reasons for our growth. As sign ups have become more frenzied and we’ve had waitlists across our studios, we have opened new studios to service those riders as fast as we can.” Whelan told Webster. “We really see where the pain points are for riders so we can bring more of the class and more soul to the people."

This, Whelan told Webster, is why much of the “what’s next” for SoulCycle is really focused on building out their core business – as they have “barely scratched the surface” of what they think is the addressable market for their unique studio offering. Though she did note that retail and their increasingly well established digital communities are both strong contenders for future development.

For those not privy to its better-living-through-spinning ethos, the notion of SoulCycle might seem a little frivolous. If you find yourself sort of itching to tease a service that has persuaded consumers into competing to pay $34 a ride for the candle-lit charismatically led version of a service they would pay a fraction of as much for at a regular gym – you would not be the first person to plough that comedic field. Buzzfeed has had its fun with the firm – and the Netflix series “Unbreakable Kimmy Schmidt” dedicated an entire episode to the punchline that SoulCycle is a cult.

However, it does bear noting that SoulCycle is well positioned to serve a very big and growing market. Boutique fitness is an emerging market – yoga studios are opening every day and the Bar Method franchise is opening pay by the class studios by the dozens in major cities, too. Americans spend $60 billion on gym memberships a year. And while there are not many statistics that reliably relate how many Americans don’t use their memberships – one study indicates that only about 18 percent use their membership regularly. Some quick calculations would indicate that $48 billion a year are being wasted by people who want to exercise – but lose interest for whatever reason after some time.

So while some may want to tease at SoulCycle’s undeniably new age approach to fitness – the fact is they have found an engagement model for exercise that actually seems to work. It would seem they can take a few jokes – as they will likely be the ones laughing all the way to the bank – with a cadre of well-toned SoulCycle enthusiasts right behind them.


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