Few sports brands are able to reach speeds of development like Canada’s Lululemon. As data by Statista(2019), the brand ’s net income was only $ 3,353.59 million in 2008, and it has reached $ 3,288.32 million in just 11 years. Today I will focus on customer segments and customer relationships of business model to analyze the brand strategy of lululemon’s successful operation.
Chip Wilson, the founder of Lululemon, is a yoga enthusiast. When he participated in a yoga training in 1998, he found that most of the people wore cotton-polyester blended fabric sportswear. These fabrics are neither close to the body nor sweaty. The design for a woman just changes the man’s clothes size and add some feminine color. So he started designing and improved based on the feedback from the exerciser. Designed to take into account women of all sizes.
1. The customer segments: People of the middle class and above (Female-dominated)
The average price of each legging is around £ 40-50. The price of lululemon is not cheap for a nine-to-fiver. In contrast, People of the middle class and above can afford it. Also, they more focus on product, quality and additional attributes, such as design and brand value. They are well educated and have a certain level of consumption. At the same time, they have requirements for health and quality of life. So for a slightly higher price the product is completely acceptable.
Lululemon has earned great returns with the start-up period of “Precision Serving the Vertical Segment of Women’s Yoga Wear”. As data by Statista (2019)this brand has a female consumer percentage of 90%.
2. Key Partners: Invite famous yoga masters to carry out offline activities to enhance the relationship between consumers
Unlike traditional brands invite celebrity endorsements, Lululemon invite famous yoga teachers and fitness instructors to build a stable KOL team. Lululemon refers to these KOLs as brand ambassadors, using these KOLs to influence consumers. Lululemon taps the 20 most popular fitness instructors and yoga teachers to become their brand ambassadors, provide free clothing to brand ambassadors, and hang up brand ambassadors wearing Lululemon posters in the store. In return, these ambassadors also want to introduce their customers to Lululemon. Let the brand spread slowly in these KOL circles. Establish a community-based marketing strategy through social networks, crowds, and store activities.
Lululemon’s success is not accidental. It accurately locates the customer base on the premise of fully grasping the market rules. At the same time, we will develop a new marketing communication model, relying on KOL’s word-of-mouth influence and meticulous community cultivation to achieve economic benefits and customer loyalty.
Emma Bedford (2018) lululemon athletica – Statistics & Facts. Available at: https://www.statista.com/topics/2975/lululemon-athletica/ (Accessed: 29 November 2019).
Statista (2019) Net revenue of lululemon worldwide from 2008 to 2018. Available at https://www.statista.com/statistics/291238/net-revenue-of-lululemon-worldwide/ (Accessed: 29 November 2019).