In an age where experiential and group fitness classes are thriving, led by the likes of Soulcycle and Flywheel, Aaptiv is seeking to buck the trends using audio based workouts. Founded in 2015 by Wharton grad Ethan Agarwal, Aaptiv’s workouts use audio cues to push their 200K+ subscribers through various workouts – running, elliptical, high intensity interval training, etc. Aaptiv costs $15 per month for unlimited access – notably different from the fee-per-class model common to group fitness classes.
Aaptiv today is a service based model – subscribers pay a fee for access to workouts from a specific set of trainers. Aaptiv’s 16 trainers are full-time employees based in New York, and most of them make the majority of their money from Aaptiv[i]. With a $26M round of funding recently closed, Agarwal has stated that he is eager to hire more trainers in the race to gain market share in the competitive fitness space.
One of Aaptiv’s biggest competitors is Nike, with its Nike Training Club and Nike Running Club. Both of these apps have one thing that Aaptiv does not – video. Users get fewer audio cues, but if they need an explanation or visual of the exercise they are supposed to be doing, they can simply look at their screen. Nike Training Club notably features workouts from famous athletes, such as Cristiano Ronaldo, Serena Williams, Kyrie Irving, and more. These workouts feature a quick intro from the athlete, and sometimes even audio cues from the athlete throughout. Nike Running Club recently launched audio guided runs, which do not feature video but have one of Nike’s many coaches from their real-life running clubs throughout the country guiding users through a run. Perhaps showing that Nike believes this to be a winner take all market, and because it seems to believe that users of these apps are more likely to purchase Nike apparel or shoes, both of the apps are currently offered for free.
Aaptiv also competes against other workout programs such as Bikini Body Guide by the beloved Kayla Itsines and home fitness classes from Peloton, which also sells its bicycle and is one of the few workout class providers to sell hardware.
From Service to Platform
In order for Aaptiv to compete against the much greater capitalized Nike Training and Running Club, Aaptiv will need to provide superior workouts that more than offset the impressive nature of the athletes on the Nike apps. Rather than trying to compete in Sports Marketing by recruiting more athletes, a race Aaptiv is almost certain to lose to Nike, Aaptiv must continue pursuing its goals of personalization.
Aaptiv’s CEO has said that “he imagines a user approaching a hill on one of Aaptiv’s programmed runs. Thirty yards out, the trainer guiding the runner on her workout warns of the upcoming incline. ‘Last time you did this slope, you did it at a 10 minute mile pace,’ the voice says as the beat of accompanying music slows. “’Can we do better?’” In order for this to become a reality, Aaptiv is working to develop an algorithm that integrates a user’s data with real-time GPS tracking and various audio cues. The app’s algorithm would leverage this data to splice together audio cues to make the experience seamless. However, for this to become a reality Aaptiv will need far more users and trainers than they have today. One way to do this is to open up the service as a platform, and allow non-employed trainers to submit their own audio cues for routes throughout the country. Rather than retaining all trainers as employees, by paying trainers a small fee each time one of their workouts gets used they can (1) significantly increase the number of workouts on the platform, (2) cover a greater geographical area, and (3) reduce fixed costs and give themselves more flexibility as they scale. If Aaptiv is unable to improve its workouts through a platform-based approach, it is likely Nike’s superior trainers and branding will take market share. Users are less likely to multi-home, as both apps are gamified and reward users for consistency – something much appreciated in the fitness world. Aaptiv’s algorithm can make it a significant player in this space, but if it doesn’t keep innovating the incumbents will simply copy and integrate its model in to their own.