Lululemon Recommendation Report

 

 

SUMMARY

 

Lululemon needs to adapt some of its practices to appeal to a wider customer base. In order to reach these goals, Lululemon should offer additional sizes and clothing lines. The company would benefit from opening more stores and making the brand accessible.

 

 

 

RECOMMENDATIONS

 

• Expand line of clothing to be more inclusive of customers with different body shapes

• Create an off-brand label

• Improve product quality by returning manufacturing to Canada

• Increase outlet store locations

 

 

 

 

RATIONALE

 

Lululemon’s current practices have alienated potential customers with its exclusionary sizing and expensive prices. By only carrying sizes 2-12, Lululemon is ignoring a huge demographic; Gap Athleta, one of the fastest-growing activewear brands, offers extensive sizing options such as tall, petite, plus, and maternity. Gap Athleta is one of Lululemon’s most threatening rivals and could overtake the company unless lululemon caters to the sizing needs of all customers. Lululemon would benefit from following the example of Ralph Lauren or Gap Inc. by creating additional clothing lines that would vary by price and quality. With these additional brands, Lululemon would become more accessible while preserving its reputation as a luxury brand.

 

In recent years, the quality of lululemon products has decreased significantly. In 2012, lululemon recalled thousands of pairs of sheer yoga pants. Poor craftsmanship has continued to be a problem, as in the summer of 2015, lululemon recalled roughly 318,000 tops due to elastic drawstrings that were deemed hazardous. These errors have not only cost the company millions of dollars in sales, but has put off both longtime and prospective customers. Many staple products have negative reviews online because of quality-related issues, such as pilling, unravelling, and fading. Lululemon’s factories overseas produce massive quantities of new designs every week, but it has proved difficult to manage product quality across all of these suppliers. Lululemon should return manufacturing to Canada and focus on the quality, rather than the quantity, of the products to win back customers. Currently, there are only about 300 lululemon stores operating in the United States and Canada. Because of these limited locations, customers have to rely on online shopping. Online shoppers do not experience the unique features of the stores, like free in-store yoga classes or other community events. As these tactics have been very successful in creating a small but loyal following, lululemon could reach new customers by expanding locations. Given the massive popularity of its annual warehouse sale, lululemon would benefit from opening outlet stores.

 

 

 

 

Takeaway  

 

Lululemon needs to improve customers' perception of the brand by regaining its reputation for high-quality products and making the brand more accessible through offering additional sizes and clothing lines.