Buying Team Assignemnt Part 1:Company Profile and Analysis Elinor Hilton, Sara Lacusky, Jillian Borms
CONTENTS HISTORY/ BACKGROUND MISSION STATEMENT BRAND IDENTITY SIZE OF LULULEMON CORE PRODUCTS TARGET CUSTOMER CORE STRENGTHS
HISTORY / BACKGROUND
Founded by Chip Wilson in Vancouver, Canada in 1998, lululemon is a yoga-inspired, technical athletic apparel company for women and men. Originally started as a design studio / yoga studio. Eventually in November of 2000, at West 4th Avenue in Vancouver’s Kitsilano neighborhood, became Lululemons first standalone store. At first, the company started out as strictly women’s yoga wear, but now as grown to an overall athletic apparel company and designer.
MISSION STATEMENT Lululemon is different from other brands in the case that they do not have a traditional mission statement like other brands do. Instead, they have what they call a ‘Lululemon Manifesto’. The manifesto essentially a list of feel-good affirmations:
“breathe deeply”
“friends are more important than money”
“sweat once a day to regenerate your skin”
“the pursuit of happiness is the source of all unhappiness”
“this is not your practice life. this is all there is”
“do one thing a day that scares you”
“your outlook on life is a direct reflection of how much you like yourself”
The manifesto illustrates the lifestyle that they participate with and share, along with the positivity the company aims to exude.
BRAND IDENTITY According to Wilson, the company’s initial vision was to be a, “Community hub to provide our guests with knowledge, tools and the components for people to live longer, healthier and more fun lives.” Lululemons overall vision is that they want to, “Elevate the world from mediocrity to greatness.” This positive message has resonated with lululemon fans across the globe. Lululemon wants to highlight and emphasize the yoga culture and spirituality and combine it with its own cultural identity. Lululemon is built on high-quality, high-styled and high-performance products suitable for most active sports.
STORES AND ‘EDUCATORS” Lululemons store employees are called “Educators” instead of “Sales people”. They are required to embody the yogic lifestyle. Lululemon educators, “are encouraged to discuss exercise goals with customers and take into account their feedback written on chalkboards in the fitting rooms.” Educators also are told to dress as though they were going to work out, they do this so customers we them as someone that they would see at a gym or yoga class, rather than just another sales person.
IN-STORE YOGA STUDIOS Different from traditional sport brands, lululemon positions itself as a community. Nearly all lululemon stores offer free yoga classes one a week. This positions Lululemon as a “fitness and conversation hub� rather than just a retail store. Does not use celebrities as the face of its brand. Instead will have ambassador-the most popular local yoga or fitness teacher. Ambassadors will meet regularly with the companies managers and give feedback on the products in exchange for free clothing.
SIZE OF LULULEMON Lululemon Athletica has brick and motar stores across the globe. As of Decemeber 6, 2018, the company operates 426 stores in the United States, Australia, New Zealand, Canada, the United Kingdom, and Singapore. Brick and Motar stores are a big part of helping with Lululemons brand identity. Lululemon believes that its stores help the company connect with customers and recieve feedback on products, while also reinforcing the brand.
BEYOND BRICK AND MOTAR
In addition to brick and motar stores, the company also sells its products to wholesale customers such as fitness centers and yoga studios. The company also generates revenue through online sales from their lululemon and Ivivva websites. Other sales include warehouse sales and sales through showrooms and temporary locations.
LULULEMON SALES In Lululemons most recent press release regarding the fourth quarter of fiscal 2018, the company anticipates that the net revenue will be in the range of $1.140 billion to $1.150 billion. This being up from their previous net revenue of $1.115 billion to $1.125 billion, making it a 17.33% increase. This new revenue is based on comps increasing in the mid- to high teens, this being up from its high single low digit estimates. Lululemon Athletica annual sales for 2018 was 2.649B, which was a 13% increased from 2017. Lululemon Athletica revenue for the twelve months ending October 31, 2018 was $3.050B, a 21.49% increase year-over-year.
MARKET SEGMENTATION Lululemon althetica is a specialty store chain Lululemon designs, manufactures, and distributes athletic apparel and accessories Positioned within the athleisure market as a brand with: A clean and fresh aesthetic
A heavy focus on yoga as an activity
High quality products
Innovative fabrics and features
CORE-PRODUCT CATEGORY
Apparel: Pants Shorts Tops Jackets, etc. Fitness-related accessories: Bags Socks Underwear Yoga mats and water bottles etc.
TARGET CONSUMER PROFILE As of 2018, Lululemons age demographic ranges from 16 to 45 years old. Lululemon aims to market to active people looking to elevate themselves, whether that be through exercise or not. Lululemon has been developing their brand to actively reach more customers through community making public forums like the ‘Sweat Collective’ to facilitate communication between athletes. This shows that Lulu is targeting tech savvy clients who are looking to improve themselves through: community, clothing,and ‘sweat’. This is where our Val report comes in. The majority of clients shopping Lululemon are Experiencers. Experiencers are high consumers. They are fashionable and want to feel as though they are part of something bigger. Lululemon’s Sweat Collective is a perfect marketing tool to draw these experiencers in and make them feel like they are part of the brands identity.
WOMEN’S MUSE: OCEAN
MEN’S MUSE: DUKE
32 years old
35 years old
Professional
Athletic opportunist
Yearly income: 100,000
Single
Single
Surfing, snowboarding, thrill seeker
Athletic, traveler, fashionista
The founder Chip Wilson said Lululemon was created for athletic opportunist, people who are young, active, relationship seekers. Wilson describes his ideal consumers as the muse of the company further demonstrating Lulu’s passion for its clients. Ocean and Duke are the muse’s. Although there isn’t much detailed information on what the ideal male customer looks like, lulu is striving to increase their male market and succeeding.
VALS CUSTOMER PROFILE We believe our perspective customers are 65% Experiencers. Experiencers are consumers who want everything, they are motivated by what’s new and like to be trend setters. Most Experiencers are young active people who appreciate being sociable and in community. Achievers our are next customers averaging about 30% of lululemon’s business model. Achievers, are usually professionals with busy schedules. Achievers are smart shoppers and usually buy with knowledge of the product first. Finally Achievers are family and goal oriented which means they want the best for themselves and family. Our last customer segment is Innovators, taking up about 5%. Innovators, are upper class individuals who know what they want. They are always in the market for new technology that will benefit them and how they feel. They are smart and skeptical when it comes to advertisements and look toward future technologies and what will be the next big thing when shopping.
CORE STRENGTHS AND COMPETENCIES
Athleisure Brand Affinity Product, yes, but also Experiences + Lifestyle Key opportunities for growth: Experience Menswear Sustainability
CITATIONS https://info.lululemon.com/about/our-story/manifesto?clickref=1101l5Uq7AD2&CID=PHG_aff
https://www.businessoffashion.com/articles/news-analysis/luxury-menswear-growth-to-outpace-womenswear
https://www.huffingtonpost.com/jessica-marati/behind-the-label-theideo_b_1922768.html
https://www.huffingtonpost.com/jessica-marati/behind-the-label-theideo_b_1922768.html
http://www.valueline.com/Stocks/Highlights/SWOT_Analysis__lululemon_athletica_inc_.aspx
https://www.marketwatch.com/story/retail-profit-and-sales-warnings-batterstocks-but-lululemon-shines-2019-01-14
http://endgamebusiness.com/lululemon-a-company-without-a-mission-statement/
https://0-www.wgsn.com.library.scad.edu/news/lululemon-ups-outlook-on-global-success-especially-digitally-in-china/
https://info.lululemon.com/about/our-story/history
https://www.investopedia.com/articles/investing/052715/understanding-lululemons-business-model.asp
http://investor.lululemon.com/static-files/0276c109-3f06-4d9e-9c06-b26dfc50c525 https://www.forbes.com/sites/gracelwilliams/2018/06/28/retail-check-up-lululemon-athletica/#cea35315b87e https://qz.com/1518448/lululemons-next-target-is-mindfulness-for-men/ https://retail-index.emarketer.com/company/5374f24c4d4afd2bb44465b9/lululemon-athletica/
https://www.forbes.com/sites/andriacheng/2018/06/01/take-note-nike-adidas-lululemon-may-become-a-real-threat/#5b3371cd6d8f