Lee-Anne Lingo Profession Fortfilio FASM 440 Professor Knaus
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TABLE OF CONTENTS 2
1 Executive Summary Page 5 History Page 7 Mission Statement Page 9 Manifesto Page 9 Niche Page 9 Tage Line Page 9 Core Values Page 9 2 Company Summary Company Profile Page 11 Target Audience Page 11 Consumer Analysis Page 11 Industry Page 13 Unique Selling Point Page 13 SWOT Analysis Page 13 3 Market Analysis Current Position in the Market Page 15 Community-based Marketing Page 15 Perceptual Map Page 15 4 Conclusion Page 17
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Executive Summary: Founded in 1998 by Dennis “Chip” Wilson in Vancouver, BC, lululemon sells ‘innovative, technical appare products’ that are “designed to offer performance, fit and comfort while incorporating both function and style.” The origin and heritage of lululemon are based on the teaching of yoga and the success of the company has bee predicated on this fact. Lululemon Athletica is an athletic apparel store that sells high quality performance wear, geared primarily towards women who lead healthy lifestyles and want to do so in a comfortable - yet fashionable way. These individuals are lululemon’s most significant customers. Lululemon has developed a cult-like following among athletes with their educated sales representaties, enlightened manifesto and their positive outlook on life. While lululemon is known for their yoga classes in-store and at Parks, my proposal to host “An Evolutionary Day” Event continues in the same vein of healthy lifestyle and under the stewardship of the Ambassador Program, but the inclusion of all the sports within their portfolio. The aim is to attract new customers while maintaining our old with fun-filled activities associated with our apparel, all on one day. “An Evolutionary Day” is about creating a positive impact on the community: educating, brand awareness and healthy lifestyle. At Piedmont Park, Atlanta a lululemon truck will provide healthy drinks/smoothie (Juice Bar) and there will be a pop-up shop with new arrivals. There will also be a Question & Answer segment where our educators will ask questions. Giveaways to our customers who use the hashtag #DoYouLulu on our social media. “At the end of the day when you are 80 or 90 you want to know that you have made a difference in life.” Chip Wilson
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History The story of Lululemon begins with Dennis “Chip” Wilson who founded Lululemon Athletica (referred to simply as ‘lululemon’ or ‘lulu’) in 1998. After taking a yoga class which he found exhilarating, Chip found an opportunity to pair yoga with his passion for technical athletic fabrics. Lululemon was born in response to an increase in female participation in sports and in accordance with his belief in yoga as the optimal way to maintain athletic excellence into an advanced age. The original intent of lululemon was to “elevate the world from mediocrity to greatness.” The name came from a survey of 100 people from a list of 20 brand names and 20 logos. The logo is actually a stylized “A” that was made for the first letter in the name “Athletically hip.” In 2003, lululemon was named Most Innovative Retailer of the Year. In 2004, Lululemon started moving past the Canadian border and in 2005 Lululemon opened a store in Japan. At present, there are 254 stores within the United States, Canada Australia and New Zealand and in 2009, Lululemon started an on-line store and within their first quarter they generated 15.6% of sales from the web. In that same year, they created a Children’s store targeting children aged 6 – 12 years.
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Mission Statement:
Creating Components for people to live longer, healthier and more fun lives.
Manifesto:
We are passionate about sweating every day and we want the world to know it. Breathing deeply, drinking water and getting outside also top the list of things we can’t live without. Get to know our Manifesto and learn a little more about what lights our fire.�
Niche:
Fashionable athletic apparel Tag Line
Beathe Deeply
Core values:
Quality Our guest want to buy our products again
Product We create a component designed by athletes for athletes
Integrity We do what we say we will do when we say we will do it. If we cannot keep our promise, we immediately contact all parties and set new by-when dates
Balance There is no separation between family and work
Entrepreneurship We treat and pay employees as though they run their own business
Greatness We create the possibility of greatness in people because it makes us great
Fun When I die, I want to die just like my grandmother in her sleep. Not screaming like all the passengers in her car. 9
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Company Profile Lululemon Athletica Inc. (lululemon) was the birth of the underground yoga clothing movement. The founder, Dennis “Chip” Wilson took a yoga class offered in Vancouver and found the experience exhilarating. He found that the clothing then offered for the people who did yoga were sub-par and he decided to change that. He set the company ideology of comfortable, breathable clothing for athletic excellence. It is a specialty brand with high prices for their apparel and merchandise, because of the high quality and durability within their material. In November 2000, the first store opened in Vancouver BC. This ideology carries through upon the companies’ interaction with community and lifestyles. The employees are educators in various athletic crafts, ranging from yoga to running. These educators/employees personalize one’s experience at the store ultimately creating a strong brand recognition and loyalty which is rooted in brand awareness.
Target Audience: “Our primary target customer is a sophisticated and educated woman who understands the importance of an active, healthy lifestyle. She is increasingly tasked with the dual responsibility of career and family and is constantly challenged to balance her work, life and health. We believe she pursues exercise to achieve physical fitness and inner peace.”
Consumer Analysis
Demographics: Fit business & middle age women (18 – 34 years) with disposable income. Psychographics: Usage style - running, pilates, yoga, tennis Purchase motives – trendy, stylish, comfortable, iconic logo, innovative Lifestyle – disposable income, young mothers, sub-urban people who are dedicated to looking good while working out.
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Industry Athletic Apparel. The U.S. sporting apparel market which Lululemon is classified under, is the world’s largest sportswear market, accounting or 41% of total sales. According to a Plunkett Research report, manufacturers such as Stella McCatney, Nike and Adidas are pushing their sporting apparel lines with “an ever-increasing variety of styles that can go from gym to nightclub.” Yoga is a continually expanding industry and the sporting apparel industry is projected to continually increase.
Unique Selling Point: Lululemon clothing embrace fashion and athletics, creating an image like no other athletic apparel does. The brand has become known and recognized as “high end” which makes it more unique than your basic athletic brand like Nike and Adidas.
SWOT Analysis on Lululemon STRENGTHS: Trade Mark Fabrics Community Involvement Innovation Brand Identity High Quality Product Superior Customer Interaction Premium Store Location
WEAKNESS: High Price Point Narrow Product Line Slow Growth Few Retail Locations Weak Brand Recognition in the U.S
Opportunity: Expand Product Line Expand to Additional Geographic Maket Expansion of Healthier/Active Lifestyle Growth in E-Commerce Business Wide Distribution Network
Threats: Increase Competition Economy Knockoffs Niche Market Decreasing consumer spending
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Current Position in the Market: As a result of an in-depth investigation of current competitors against Lululemon, I have created a Perceptual Map to analyze each retailer’s standing within the market space. As a result of charting its competitors I can therefore determine who are Lululemon’s strongest opponents as well as the weaker ones who still pose a threat to the company. Upon evaluation, NIKE is our closest competitor while Fabletics and Athleta fall at the lowest end of the strata. Lululemon and Athleta occupy a close space as they rank within a higher price point, however they still specialize in being performance driven.
Community-based Marketing: Lululemon’s grassroots strategy and marketing help to build brand awareness and loyalty customers in the community. Through local “ambassadors,” social media and in-store community boards, Lululemon creates brand loyalty and grows its brand awareness locally. Keeping in line with its objectives, Lululemon will seek to create customer awareness regarding its brand, develop the target customer base and establish lasting connections with target markets.
Perceptual Map:
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CONCLUSION: Lululemon is about doing it right, that is, selling a lifestyle not just a product. They have constructed a brand persona that embodies all things their target market can identify with e.g. Manifesto: “Dance, sing, floss and travel.� They have created a cult-like brand loyalty. Lululemon has correctly identified the priorities of their consumer base, that is, their customers are looking first and foremost for the technical aspect of their garments. Since lululemon’s consumers are heavily entrenched in the culture of yoga which includes making strides to improve the world, ultimately their consumers find value in lululemon as they are heavily involved with their communities. Lululemon has chosen to focus on community and has capitalized on exclusivity. Products are offered in limited quantities to create a sense of urgency. They are engaged in local community by offering educational events e.g. free in-store yoga class, under their brand Ambassador Program.
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SUMMER 2015 THE GREAT ESCAPE
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