Should Lululemon Bend Over Backwards to Cater to Male Consumers?
Women’s activewear brand Lululemon has announced its desire to open its first standalone men’s store in 2016. The brand, which has largely been credited with the astronomical ascent of functional yogawear into mainstream fashion, has been through a rough patch of late. Barely months after a fabric sheerness catastrophe concerning the brand’s best-selling Luon pants, CEO Christine Day announced her shock departure on 11 June 2013.
With a spate of competitors avidly targeting the premium women’s activewear category, it is clear that Lululemon needs to pick up that pace. But with the retailer’s currently narrow geographical and category coverage offering numerous possibilities for advancement, is diversifying into the menswear territory the way to go?
Competition intensifies as fashion meets function
Having so assiduously developed the fashionable women’s activewear niche, Lululemon is in many ways the victim of its own success as brands from all ends of the market are avidly targeting this lucrative category.
The company’s competitors take three forms. Firstly, brands directly positioned alongside Lululemon are promoting a similar yoga lifestyle ethos. These include fellow Canadian brand Lolë and Gap’s Athleta. Athleta has been pursuing retail expansion while also adopting similar marketing strategies to Lululemon, such as offering free yoga classes and discounts to instructors, while competing on price.
Secondly, sportswear heavyweights are aiming to raise their profile among female consumers. In November 2012, Nike used its performance footwear expertise to launch the Studio Wrap, a three-piece ‘footwear system’ designed for women who engage in studio-type workouts. Under Armour is also pointing its efforts towards fashion-conscious female consumers, both through its products and appealing store formats.
Finally, a range of general brands like H&M, Uniqlo and Gap are seeing potential in offering functional and fashionable sports clothing at mass-market price points.
The investment of these brands from all angles clearly emphasises that demand for fashionable women’s activewear is here to stay. But, as competition heats up, Lululemon will have to look for new growth avenues.
‘Lulu-men’ will be a tough sell
With menswear emerging as a bright spot across all apparel categories, it comes as no surprise that Lululemon has identified this as its next area for expansion. According to company data, menswear accounted for 12% of brand sales as of January 2013, and it is hoping to raise that figure to 20% over the next couple of years. There is a gap in the market for men’s yogawear, and Lululemon certainly has the expertise to fill it.
Nonetheless, attracting the male consumer will be no easy feat for such a female-oriented brand. Tailoring the retail experience by opening a standalone menswear store is a step in the right direction, and has been a move favoured by luxury brands including Jimmy Choo and Burberry in their bid to tap into the burgeoning premium menswear market.
However, with a name like Lululemon and brand philosophies which include “dance, sing, floss and travel”, Lululemon will have more pressing issues to address in terms of marketing and advertising. At the same time, diluting this ultra-feminine allure runs the risk of alienating existing consumers.
This begs the question – should Lululemon be focusing on menswear given its heavy investment in becoming a women’s lifestyle label?
Exporting the yoga lifestyle abroad
Perhaps a more potent opportunity lies in international expansion.
In 2012, over 90% of the company’s sales were derived from North America alone. While consumers maintain a healthy appetite for premium sportswear in this market, where performance clothing (in which Lululemon operates) accounted for almost 40% of total sportswear value sales in 2012, the retailer should remain proactive in terms of broadening its geographical footprint.
In 2013, the company plans on opening 10-15 showrooms abroad, notably in Western Europe and Asia Pacific. Its strategy of using showrooms in tandem with e-commerce orders to pinpoint locations for store openings is certainly a savvy one.
Asia Pacific in particular presents a key opportunity for Lululemon. In China, for example, female residents in cities have shown continuous enthusiasm for participating in regular physical activity as they seek to balance their health with increasingly hectic lifestyles. Activities such as badminton, yoga, pilates and dancing have proved popular among women.
Performance clothing is set to witness the strongest growth in absolute terms over the forecast period, adding US$3.6 billion. Lululemon is well positioned to fill the gap in the market for a premium female-focused activewear brand, and lead the yoga lifestyle in markets where it is not as popular or saturated.
Maximum benefit, minimum contortion
While expanding into menswear may hold potential, Lululemon has far from exhausted its potential in womenswear, particularly in terms of international growth. Its formula of stylish designs, lifestyle marketing and product scarcity has built a cult-like following across North America. This provides a ready-made template for success in new territories and may prove a better bet in terms of retaining its trailblazing status.