Mirror: digital disrupter in fitness and beyond
Mirror looks like a winner. It is disrupting the home fitness landscape and is poised to impact the healthcare, education, and social media landscapes to name a few.
The Past
At home exercise used to be aerobics with Jane Fonda on a VCR which evolved to P90X and other DVD products. In today’s competitive digital age, the convince of working out at home is not enough.
The Present
Today, Peloton is usually the first name that comes to mind for at home exercise. Devoted at home cyclists, viral ads, and a recent IPO have highlighted the promise of digital fitness solutions for the home. Peloton has a cult-like following of over 1.4 million users. Buying the at home exercise bike costs $2,245 and at about $40 per month, users can attend classes, track their statistics, and get shout outs from trainers or other members. Peloton started in 2012 and IPO in September 2019 at $29 per share, a valuation of about $8.1 billion. This product was first in disrupting the gym industry through a digital platform and highlights the opportunity for digital in the at home fitness landscape. Due to the hardware, Peloton is seeing limitations in its solutions and has put a cap on its ability to scale beyond cycling. (True, they have entered into the treadmill space, but this has the same conceptual limitation factors that any large equipment, geared towards one general motion, would face.)
The Future
Mirror is a new entrant into the at home fitness market. At first glance, it looks like any other mirror but can display fitness programs, live instructor programs, your workout data, and contains speakers, a microphone and camera to better facilitate your workout. It also comes with a heart monitor with straps but you can sync up to your apple watch if you prefer. Mirror provides some of the same benefits that Peloton does- at home convenience, membership into weekly or direct classes, data around performance statistics, a community, and a less high, but still costly hardware buy-in and subscription model ($1,495 for the mirror and $39 for a monthly subscription). Founded in 2016 by a Harvard Alumni, Mirror finalized its series B at the end of 2019, totaling $74 million and is evaluated at over $300 million.
The successes that support this evaluation of Mirror is largely compounded by four key elements: firstly, the buy-in to the concept has been paved (fast-follower), secondly, there are less limitations implicated by the hardware, thirdly, strategic partnerships and endorsements, and lastly, expansion beyond the at home fitness industry.
-Fast follower
Mirror does not have to put in the resources to educate the public and its target base around what at home fitness is like, the high cost of the hardware, or the subscription model for classes. As a first mover, Peloton did much of this heavy lifting to solidify this idea to a large user base. Mirror can ride the “Peloton wave” into peoples’ homes with much less friction than Peloton faced.
-Vast Fitness Possibilities
Mirror’s hardware takes up far less space than a Peloton or treadmill but that is just one aspect of differentiation. While competitors focus on exercises that are dependent on the hardware (cycling or treadmill), Mirror’s hardware allows for users to engage in a multitude of fitness routines. Yoga, HIIT, barre, boxing, and weight training are just a few of the options Mirror subscribers have access to in the comfort of their own homes. The impact of this digital solution taps into the global network of popular, alternative, and newly trendy exercises that can be led by instructors around the world at a user’s convenience. Importantly, this product can adapt with budding trends or cultural influences in fitness where its competitors cannot. Before the next Zumba becomes a staple in fitness centers, a curated version could be transported to your home. You might have such a good time that you have your friends join the following class and join the Mirror community. Similarly, with personalized data and preferences, these new types of workouts or communities can be appropriately surfaced to targeted users. If the workout requires additional equipment, such as light free weights, there is a potential marketplace created as well. This alludes to the potential Mirror has beyond fitness.
– Expansion Beyond Fitness Possibilities
While Mirror is currently marketed as a digital fitness tool, its applications could go far beyond toning your abs. The healthcare sector is booming in telehealth solutions and Mirror is poised to leverage their hardware and data in order to deliver this care to users. The large interface, camera, speaker, and mic all provide the basics for many levels of care. Mental health visits or physical therapy could be done through Mirror’s platform. Taking physical therapy as an example, a user has personalized data about their preference and ability to do a specific yoga class. This means not only tailored versions of yoga poses to make sure you don’t irritate a recent injury, but also an avenue for customized physical therapy and live feedback to speed up that same issue. Strength and flexibility can be captured through both the yoga session and the physical therapy session or perhaps one can substitute the other. Either way, tracking the exercises and performance on them can be recorded and sent to the user’s provider. Again, this is just one example of how mirror could expand into other markets and create a vast amount of value; the possibilities are plentiful (teaching courses for sign language, augmented reality that allows potential buys to try on clothes before purchasing, and as social networking platform to name a few).
– Initial Fitness/Lifestyle Partner
With the environment primed, large scope into areas of fitness as well as the potential to move beyond, it is no wonder that large fitness clothing retailers would be an attractive partner; Lululemon thought so too. The digital presence that Lululemon currently has through its social media and online retail would help launch Mirror into already well established communities that largely fit Mirrors target demographic. Mirror’s digital platform will get a boost with engaged community members as well as potentially providing feedback to investors like Lululemon about their products (eg. are users wearing the clothes during workouts, non workouts while using the camera, ways to surface items in curated manner to buyers).
The future holds many potential avenues for Mirror but even as a fitness solution, this digital offering opens doors where its competitors have not. Mirror is positioned to tap into multiple markets given its hardware, digital technology, and social connectivity.
References
“Fitness Start Up Mirror Raises”. 2020. Techcrunch.Com. https://techcrunch.com/2019/06/03/fitness-startup-mirror-nears-300m-valuation/ https://www.businessinsider.com/lululemon-karlie-kloss-invest-mirror-2019-10.
Owens, Jeremy. 2020. “Peloton IPO: 5 Things To Know About The Interactive Exercise-Machine Company”. Marketwatch. https://www.marketwatch.com/story/peloton-ipo-five-things-to-know-about-the-interactive-exercise-machine-company-2019-08-28.
“Peloton Ad Is Criticized As Sexist And Dystopian”. 2020. Nytimes.Com. https://www.nytimes.com/2019/12/03/business/peloton-bike-ad-stock.html.
WIRE, BUSINESS. 2020. “MIRROR Announces $34 Million In New Funding”. Businesswire.Com. https://www.businesswire.com/news/home/20191030005189/en/MIRROR-Announces-34-Million-New-Funding.
I would disagree, I would predict Mirror will be a total loser in this market. This is primarily because of the disconnect between their questionable value proposition and high cost. Their website claims that they offer “THE NEARLY INVISIBLE HOME GYM”. However, there is no gym equipment included in the package at all, visible or invisible. They should say, “Gym equipment not included.” Fancy marketing aside, they are offering an oversized digital screen with significant glare that lets you watch a remote instructor. Odds are, these affluent customers who have $1,495 in loose change, already own a smart TV which can play any videos, live or recorded, which they desire. The ability to simultaneously look at one’s self only adds value to people who have a positive body image or find their negative body image motivating (a rare few), and only reduces their value proposition. It reminds me of the compelling ad for Planet Fitness (from 2018) called “Mirror Guy” https://www.youtube.com/watch?v=2afTmPt9egw which highlights the selling point that their gyms don’t have any mirrors.
Hopefully, despite the curated glowing reviews on their website, consumers will see through the marketing before regretting their purchase of this overpriced screen with limited utility.
This is such a unique product, and I am excited to learn it’s founded by an HBS grad! I like your point about how this hardware (unlike stationary bikes, treadmills, etc.) is more flexible and capable of adapting to changes in fitness trends. I wonder if growth can be fueled through partnerships, say, with independent fitness instructors. While gyms may not want to contract with mirror (why would 24hr fitness want people to workout at home), individuals looking to profit from additional training hours might contract with mirror. The proliferation of instructors, as well as mirror users, highlights that the mirror is in itself a platform, with two sides who benefit from growing the other (i.e., there are network effects in play here).
I agree with the first comment that I struggle to see Mirror winning this market. I think it’s advantage is its trendiness (and the amount of marketing spend that overloads our feeds), but I’m not sure why the Peloton app can’t replicate a lot of the main things Mirror is doing in terms of bringing people classes. The other health and fitness monitoring is nice, but think ancillary, and for the steep price that Mirror costs, I think there are other ways users can get this information. There are some other products like these trying to enter the market (e.g. Tonal) and my opinion would be that having some equipment is what you’re paying for since virtual classes are pretty easy to replicate themselves. Time will tell though!
Thanks for your thoughts. I’d like to follow up on a few things you mentioned:
I see your point with Tonal and I think a lot of what will make Mirror more capable will be on the software side-being able to execute on feedback that is not reliant on actual instructors but rather automated feedback (ai). That being said, I’m assuming that the data in order to get to that point is not something that Mirror has yet. They’d need to be collected from users. There are some targeted data files that have athlete data in Asia for instance but I’m not sure that could be applied for lay people or would be applicable to folks in the US. So in the meantime instructor led classes would be worthwhile with the ability to get feedback via the camera/speaker and added knowledge to the user by self-assessment through the reflection during that feedback.
The Peloton app is also a great idea but largely limited by the hardware that displays information on such a small scale; it would be interesting to see if Mirror has a play as an app hosting product that would be integrated much in the way that alexa/googlehome are.
We shall see how it pans out!
Great article and some excellent insights in the comments. I think Mirror offers a unique value proposition from a hardware + software perspective. I’m not as sure about the home workout market being ready for this kind of technology just yet, considering that companies like Peleton are dumping tons of money into advertising and customer education. I think the use case for Mirror is also less intuitive than a stationary bike, which have had a much longer history in at-home workout environments and have been paired with rudimentary technology for a while now (even as simple as mounted TV’s at the gym). However, I think if Mirror gets it right and builds a following, then opportunity to add features such as augmented reality and third party apps could be huge. Though that involves diving into a space with well funded competitors and could potentially raise concerns around data privacy. It will be interesting to see how this space evolves.
Thanks for the insight into Mirror and the evolving digital fitness industry. I find intriguing that central to Mirror’s value proposition is its ability to provide other kinds of interactive digital experiences (e.g., teletherapy). The line does really start to blur between all-purpose screens with a camera on the one hand and interactive smart hardware on the other. To what extent does hardware and software integration need to be custom-built to the use case? It’s difficult to see a winner in Mirror as it stands today because of aforementioned reasons, but given its flexibility for myriad applications it would be fascinating to see how Mirror can continue to provide value that is targeted and significant to consumers.