{"id":4820,"date":"2015-12-09T16:12:45","date_gmt":"2015-12-09T21:12:45","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/soulcycle-intense-brand-loyalty\/"},"modified":"2015-12-09T16:14:13","modified_gmt":"2015-12-09T21:14:13","slug":"soulcycle-intense-brand-loyalty","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/soulcycle-intense-brand-loyalty\/","title":{"rendered":"Soulcycle: Intense Brand Loyalty"},"content":{"rendered":"

Soulcycle was founded in 2006 by Julie Rice and Elizabeth Cutler in Manhattan\u2019s Upper West Side with the aim of creating a fun, inspiring and intense work out that was unlike a typical gym experience. They started with one small spinning studio, and have since\u00a0grown significantly with 76% Revenue and 78% EBITDA CAGR\u2019s over the last 3 years and 38 locations across seven major cities.<\/p>\n

The company offers 45 minute spin classes multiple times a day, 7 days a week, but sees\u00a0itself\u00a0as much more than just a fitness studio. Soulcycle describes itself as an aspirational lifestyle brand, and therefore aims to build extreme brand loyalty among its customers through a unique fitness experience. This loyalty creates a community of dedicated riders who willingly spend hundreds of dollars a month on spin classes to \u201cget their fix.\u201d The intense commitment of its customers has shown very clear results, since 2010 ridership has increased 58%, revenue has increased 60%, and profitability has increased 85%.<\/p>\n

Soulcycle\u2019s operating model focuses on a few key elements of the user experience to achieve and align with their goal of creating an aspirational and exclusive brand and developing a strong sense of community with their riders.<\/p>\n

Human Capital<\/em> – The company invests significantly in their employees and instructors to ensure the highest quality experience for their guests. Every employee completes hospitality training at \u201cSoul University\u201d and all instructors undergo an intense eight-week training program. Many of these employees and instructors are in fact former devoted Soulcycle customers, and therefore become the strongest brand ambassadors and resources\/salespeople for new customers. After training, the spin instructors are encouraged to develop their own unique style and to keep the classes enjoyable and fun. Soulcycle aims to be a fun and different form of working out, and these unique styles allow customers to find their favorite class or instructor that repeatedly bring them back to the studio. Unlike some other fitness studios and gyms, instructors are exclusively Soulcycle employees and cannot teach elsewhere, leading loyal customers to feel that they cannot get this same level of workout anywhere else.<\/p>\n

\"\"<\/p>\n


\n\"\"Facilities <\/em>\u2013 The Facilities are nicely designed and look nothing like a traditional fitness studio from the outside. The studios are outfitted with high end, exclusive equipment, showers, water bottles, towels, and shoe rental, yet the small design details are what really make the difference. Interior d\u00e9cor is minimal with white walls covered in bold empowering Soulcycle mantras, scented Jonathan Adler candles placed around the dark studio and complimentary amenities like lockers, hair ties, and various flavors of Orbit gum at the front desk. In addition, each store has a small retail component that sells branded apparel to customers who forgot their workout clothes or simply want to brand themselves as a devoted Soulcyclist. The highly branded apparel and gear sold in the studios also serve as a great marketing tool, creating awareness and turning devoted customers into brand ambassadors as well.<\/p>\n

Pricing \u2013 <\/em>Through the pricing element of the user experience, Soulcycle has also managed to create a feeling of exclusivity that helps build brand loyalty. \u00a0They have done this through their pricing and their class scheduling policy. Classes are sold individually ranging from $30-$40 per class or in packages with very slight discounts on a per class basis. Soulcycle does not offer sales or promotions beyond their basic premium pricing model. Their class scheduling policy is also very strict, requiring members to cancel by 5pm the night before class or lose their money. Devoted fans would never consider missing a class and are often not price sensitive if they do lose the money. As mentioned in a Business Insider article from September 2014, \u201cThe expensive classes, gear, and candles are just a way of distinguishing themselves (and each other) as a part of a very cool club.\u201d<\/p>\n

\"\"Customers come to Soulcycle to chat with friends and Soulcycle employees, get in a good, fun workout and be a part of the exclusive community. Soulcycle\u2019s great success as a pioneer in the boutique fitness space has led to an increase in competition with many others trying to replicate their model. However, Soulcycles\u2019 first mover advantage has been huge in developing its’\u00a0exclusive, intense and loyal community that is committed to paying for the Soulcycle experience and becoming a true brand loyalist.<\/p>\n

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 <\/p>\n

 <\/p>\n

Sources:<\/p>\n

Company Website<\/p>\n

Company S-1 Filing<\/p>\n

Forbes – http:\/\/www.forbes.com\/sites\/sarahmckinney\/2014\/02\/05\/soulcycles-intense-brand-loyalty-shows-no-signs-of-slowing-down\/<\/a><\/p>\n

NY Times – http:\/\/www.nytimes.com\/2015\/08\/09\/upshot\/soulcycle-you-say-cult-i-say-loyal-customer-base.html?_r=0<\/a><\/p>\n

Wall Street Journal – http:\/\/www.wsj.com\/articles\/SB10001424127887323342404579081680434969954<\/a><\/p>\n

Business Insider – http:\/\/www.businessinsider.com\/why-people-pay-34-for-soulcycle-2014-9<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The fitness studio that created a community. <\/p>\n","protected":false},"author":1030,"featured_media":4852,"comment_status":"open","ping_status":"closed","template":"","categories":[],"class_list":["post-4820","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/the-tom-challenge-tom-winners-and-losers-assignment\/","yoast_head":"\nSoulcycle: Intense Brand Loyalty - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/soulcycle-intense-brand-loyalty\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Soulcycle: Intense Brand Loyalty - Technology and Operations Management\" \/>\n<meta property=\"og:description\" content=\"The fitness studio that created a community.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/soulcycle-intense-brand-loyalty\/\" \/>\n<meta property=\"og:site_name\" content=\"Technology and Operations Management\" \/>\n<meta property=\"article:modified_time\" content=\"2015-12-09T21:14:13+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2015\/12\/logo-soul-cycle1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1651\" \/>\n\t<meta property=\"og:image:height\" content=\"1275\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/soulcycle-intense-brand-loyalty\\\/\",\"url\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-rctom\\\/submission\\\/soulcycle-intense-brand-loyalty\\\/\",\"name\":\"Soulcycle: Intense Brand Loyalty - 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