Costco partners with Peloton to sell Bike+ as it aims to attract young, affluent customers.

• Between Nov. 1 and Feb. 15, Costco will be selling Peloton's Bike+ in its stores and online.
• Peloton's Bike+ will be available in 300 Costco U.S. stores for $1,999 and on Costco.com for $2,199, which is lower than its typical price of $2,495.
• As Peloton seeks to expand its customer base, the partnership emerges as a potential solution.

Peloton is set to announce Tuesday that stationary bikes will soon be sold at stores and on its website as the fitness company seeks to attract younger and affluent customers.

Peloton's Bike+ will be available in 300 Costco U.S. stores for $1,999 and on Costco.com for $2,199 between Nov. 1 and Feb. 15. This is a significant discount from the typical price of $2,495 on Peloton's website. It is uncertain how the price will compare to any holiday promotions Peloton may have.

During a period of transition for Peloton, which is now being led by two board members following the departure of its former CEO Barry McCarthy earlier this year, a new partnership has been formed.

Peloton has shifted its focus from growth to profitability and has had to adopt innovative strategies to attract new customers.

Peloton is exploring cheaper methods to attract new customers as sales decline and losses increase, according to Dion Camp Sanders, Peloton's chief emerging business officer, who mentioned Costco as a potential solution in an interview with CNBC.

"Camp Sanders stated that the company has successfully negotiated a deal with Costco that satisfies its requirements for profitable and sustainable unit economics while also providing significant value to Costco members. The deal has been designed to enable the company to achieve profitable growth and gain access to Costco's vast customer base."

Peloton's collaboration with Costco is temporary because fitness is a seasonal category for the company, but there is a possibility that the partnership could be extended to other locations in the U.S. and abroad in the future.

Peloton has secured a deal with Costco, a retailer with a strong fan following and wealthier customers, to sell its products on their shelves.

According to Placer.ai, smartphone data indicates that store traffic at Costco increased by 31% from the same period in 2019 from Sept. 1 to the present day.

Younger Costco members prioritize health and wellness and are willing to invest in it, unlike older generations.

In the previous fiscal year, approximately half of Costco's new membership sign-ups were individuals under the age of 40, and the average age of its 76 million members has decreased since the outbreak of Covid-19, as stated by Chief Financial Officer Gary Millerchip during a late September earnings call.

Numerator's panel of 150,000 U.S. consumers, which is balanced to represent the country's population, indicates that 36% of Costco's customers have a household income of more than $125,000.

Peloton's premium products are affordable for Costco's members due to their disposable income, and their lifestyles align with what Peloton offers.

Peloton's members are often affluent and have larger homes in the suburbs, while Costco members are busy with families and careers and have the space to build their own gyms.

Claudine Adamo, Costco's Executive Vice President of Merchandising, did not respond to CNBC's request for comment.

Peloton has been expanding its business by developing relationships with companies that cater to similar customer bases, in addition to selling its workout equipment through Amazon and other retailers.

As of this month, hotel members can earn points for completing workouts on the Peloton Bike and Row during their stay.

Peloton announced a deal with Truemed, a leading provider in the health savings account and flexible spending account world, enabling Peloton members to utilize pretax earnings to purchase select hardware products, including the Bike, Bike+, and Tread.