lululemonMatthew Daugherty, Monica Faillace, Casey Nulph, and Josh Grieco

Introduction

lululemon was founded in Vancouver, Canada in 1998 and expanded into the U.S. in 2000.

The company’s original intention was to create a “hub” in which people could discuss the physical aspects of healthy living.1

The company then soon developed into an athletic apparel retail store.2

1"lululemon Athletica: Our Company History." Our History. lululemon Athletica, n.d. Web. 30 Mar. 2013. <http://www.lululemon.com/about/history?mnid=ftr;company_history>.2Ibid

Marketing Problem

Consumers perceive lululemon apparel as an expensive line that is cost prohibitive.3

In the athletic apparel market, consumers are not loyal to a particular brand because the clothing is used for workout purposes, not fashion statements.4

3 See Appendix 6. 4 See Appendix 7.

Marketing Objective

Increase brand loyalty – the athletic apparel industry is notorious for lack of brand loyalty. Our goal is to inspire brand loyalty by showing consumers lululemon products are above and beyond competitors without jeopardizing the core feeling of the brand that lululemon has already created.

Stand above competitors – the goal of our campaign is to clearly differentiate our brand from competitors while expanding the reach of the brand

Market lululemon products in a fashionable light as opposed to marketing clothing as strictly workout apparel.

Situation Analysis

The athletic apparel industry, specifically yoga products, has been growing.

Companies that once focused on general athletic apparel have added yoga products to their clothing lines.5

5 Much, Marilyn. "Nike, Under Armour, lululemon Getting More Casual Play."Investors.com. Investor's Business Daily, 26 Apr. 2013. Web. 29 Apr. 2013. <http://news.investors.com/business/042613-653675-nike-under-armour-lululemon-gain-mixing-fashion-with-function.htm>.

Situation Analysis: Continued

The addition of yoga apparel is due, in general, to the increased popularity of yoga. This competition has had a direct negative impact on lululemon's sales.6

According to Business week, “[lululemon] shares are down nearly 15 percent in [2013], while the broader markets have rallied.”7

6Urstadt, Bryant. "How Yoga Brand lululemon Turned Fitness Into a Spectator Sport -- New York Magazine." NYMag.com. New York Magazine, 26 July 2009. Web. 30 Apr. 2013. <http://nymag.com/shopping/features/58082/>. 7"Analyst Lowers lululemon Rating Price Target." Editorial. Businessweek 04 Apr. 2013: n. pag. Bloomberg Businessweek. Web. 5 Apr. 2013. <http://www.businessweek.com/ap/2013-04-04/analyst-lowers-lululemon-rating-price-target>.

Situation Analysis (Graph)

Lulu

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Under

Arm

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Gap0

10,000,00020,000,00030,000,000

Athletic Apparel Market 2012

Red = SalesPink = Net Income

Dollars

in

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As of 2012, lululemon and Under Armour are close in terms of overall sales and net income. Where did we get this graph?

Nike is a clear leader in the in athletic apparel industry.

Gap, as a corporate competitor, does really well in the industry.

Situation Analysis: Competitors*

*Information obtained from sec.gov

Trends AnalysisYoga is becoming its own form of working out. Individuals are using yoga as a way to stay fit and healthy without having to do cardio based workouts.9

Hot yoga is a new trend that’s becoming ever-more- popular. The idea is that people do yoga in extremely hot conditions forcing perspiration.

Yoga apparel as everyday clothing is becoming part of the fashion world. The newest yoga wear is becoming stylish and comfortable. This trend is making the yoga apparel market even more lucrative. 10

“lululemon Mom” is the idea that stay-at-home mothers have difficulty finding time in their schedules to workout. Therefore, “lululemon Moms” do yoga whenever and wherever the can in the midst of their their busy days.11

9. See Appendix 10.10. See Appendix 8.11. Jacobs, Deborah L. "A Working Mom Defends the 'Lululemon Stay-at-Home Mother'" Forbes. Forbes Magazine, 15 Apr. 2012. Web. 25 Apr.2013. <http://www.forbes.com/sites/deborahljacobs/2012/04/15/a-working-mom-defends-the-lululemon-stay-at-home-mother/>.

Brand Analysis:Product

lululemon aims to make durable, comfortable, and fashionable athletic apparel that lasts.

Wunder Under Crop – “The best leggings in the world. Hands down. I not only wear these to hot yoga for every class, but I also wear them all the time to work and when I’m lounging.”11

Scoop Neck Tank – “This tank is great, because like the Wunder Unders, it is super flattering and can even be worn when not working out!”

The two products above are just 2 examples of lululemon’s most popular merchandise. Note that the most popular products are for women.12

11 "lululemon Athletica: Product Features." Product Features. lululemon Athletica, n.d. Web. 30 Mar. 2013. < http://www.lululemon.com/education/info/productfeatures>.

12 Ibid

Brand Analysis: Price

lululemon products are priced highly amongst competitors in the yoga apparel industry.

Sports Bras: $42-$58 – The technology behind a majority of lululemon sports bras is unique. Costumers appear to be very satisfied with the product despite the high price. 13

Top: $42-$128 – Costumers had mixed reviews in terms of price and quality. Some were happy with the product while others complained that lululemon products are not worth the price. 14

Pants: $42-$118 – Pants are the staple of lululemon. However, there were numerous complaints about the recent lack of quality. Consumers also suggested the prices needed to be lowered. 15

13. "Lululemon Athletica: Women’s Sports Bras." Sports Bras. Lululemon Athletica, n.d. Web. 30 Mar. 2013. < http://shop.lululemon.com/products/category/women-sports-bras?mnid=mn;women;tops;sportsbras>.14. "Lululemon Athletica: Women’s Tops." Tops. Lululemon Athletica, n.d. Web. 30 Mar. 2013. < http://shop.lululemon.com/products/category/women-tops?mnid=mn;women;tops;tops >.15. "Lululemon Athletica: Women’s Bottoms." Pants. Lululemon Athletica, n.d. Web. 30 Mar. 2013. < http://shop.lululemon.com/products/category/women-pants?mnid=mn;women;bottoms;pants>.

Brand Analysis: Place

lululemon products are mainly sold at in store locations to keep the product exclusive.

Some are sold at private studios and gym stores to target yoga and fitness enthusiasts.

lululemon also offers merchandise on its website with a customer friendly return policy and free standard shipping.16

16. "Lululemon Athletica: Women’s Shipping." Customer Service: Shipping. Lululemon Athletica, n.d. Web. 30 Mar. 2013. <http://www.lululemon.com/faq/#shipping>.

Brand Analysis: Promotionlululemon is moderately active on social media.

Facebook – lululemon’s page has 820,000 likes. They post promotional strategies often. For example, during the month of may lululemon is doing a “Smoothie Challenge” which urges followers to share healthy drink ideas.17

Twitter – Their twitter account has 450,000 followers. They tweet about 1-2 times a day. These tweets engage with consumers who have questions and comments. Also, lululemon also re-tweet individuals have posted blogs about their products.18

Instagram – lululemon has 185,000 followers on Instagram. The company is very active with promotional postings and philanthropy events. For example, the last two posting have included Earth Day notifications and updates about the “Smooth Challenge.”19

Overall, lululemon is most active on Instagram but they stress consumer engagement throughout all social media outlets. 17https://www.facebook.com/lululemon

18https://twitter.com/lululemon19http://instagram.com/lululemon

Under Armour

Under Armour Headline: No Matter What I Sweat Every Day

Current Slogan: I Will

Benefit: The ad’s benefit states that women can feel comfortable, look good, and be successful when they sweat while using the Under Armour product.

Support: Under Armour implies the benefit by showing a beautiful women sweating during her workout. The ad suggests that there is a direct correlation between working out, being successful, and being beautiful.

Web Presence: Under Armour is active daily on Facebook and Twitter. The company also has a micro site and promotional campaign called What's Beautiful. The campaign is designed for women to share tips on how to live a healthy lifestyle. Another campaign they are running is called Sweat is Earned. The idea is to allow people to share and promote their personal work out goals.

Position Guideline: Position by Benefit

Athleta

Athleta Headline: No Headline

Current Slogan: Power to the She

Benefit: The ad’s benefit is that yoga gives women the power to complete intense workout and be strong, independent people.

Support: The benefit is supported by the image of women doing the yoga. The two examples on the previous slide both show women is difficult yoga poses while appearing very strong, relaxed, and independent. This is also consistent with the company’s slogan.

Web Presence: Athleta has a blog called Athleta Chi. They are also extremely active on Facebook, Twitter, and Pinterest. Also, Athleta uses Pinterest specifically for promoting their blogging competitions and giveaways.

Position Guideline: Position by product user

Nike

NikeHeadline: No HeadlineCurrent Slogan: Yoga Benefit: Nike clearly state that the benefit of doing yoga and using their products give you energy. They directly compare yoga workouts with drinking “your 3rd cup of coffee.”Support: The support of the benefit comes from the implied energy boost that the women is the ad is getting. She is striking a specific yoga pose, which they title Trikonasana, and has a calm yet enthused expression on her face. Web Presence: Nike has an extensive amount of support on social media outlets such as Facebook, Twitter, and Instagram. They are constantly posting up to date promotional campaigns. For example, they urging people in the D.C area to participate in a half marathon in a show of support for the Boston Bombing victims. Position Guideline: Position by product user

Overall Competitor Analysis

Under Armour – Under Armour is a prime example of a competitor who added yoga apparel onto their clothing line due to the sports increasing popularity. This has had a direct impact on lululemon’s recent decline in sales.

Athleta – Athleta is similar to lululemon in terms of skewing their product line towards women as well as their advertising. Athleta is also more of a yoga based company than either Under Armour or Nike.

Nike – Nike is very similar to Under Armour in terms of their expansion into the yoga market.

Primary Research: Online Survey

Online Survey – Our first step towards uncovering insight was releasing a survey. The survey released contained 9 questions. It included 2 demographic based questions and 7 questions aimed to get perspective about the lululemon brand.

Results A majority of participants were between the ages of

18 and 24. Our results clearly stated that gym goers do not value appearance during their workouts.

Our results forced us to design a campaign around the fact that 18-24 year olds would be excluded as a target consumer.

We also uncovered the fact people view the gym not only as a workout facility but also as a social scene (70% of participants believed this).

Primary Research - Interviews

Interviews – Based on the results of our online survey we organized 8 (6 women) one-on-one interviews with individuals within our target demo (25 to 55).

Results 7 out of 8 participants said they would purchase

lululemon apparel. One participant said, “lululemon has some of the

best pants on the market. You can wear them multiple times a week and they’re always comfortable.”

5 out of 8 participants said they have tried yoga at one time or another.

6 out of 8 participants recognized the trend of people wearing yoga apparel as a fashion resource.

Target Audience

Strategies

Insight –

Position Statement –

Advertising Objective –

Creative Brief

Intent to Achieve: Use lululemon fashion to enhance the consumers workout using emotional strategies such as positive self perception.

Demographic: Women, 25-44

Target Insight: The need by a certain segment of women to really want to find clothing that is comfortable and makes them look and feel good.

Benefit: Wearing clothes that make you look and feel good improves one’s workout.

Believe: The fit, fashionable patterns and colors.

Personality of Brand: sexy, energetic, active, confident, fashionable.

What should the target audience do?: When the consumer purchases a lululemon product they know they will look good.

Media Plan – Strategy

When To Target Our Audience: Before the summer season, specifically in May and June when people are getting in shape and the weather getting nicer so people are more active. Also before the holiday seasons in November and December when people are receiving holiday gifts and then before people start New Years resolutions in January.

Where To Target Our Audience:

Print Magazines: Women’s health and fitness and fashion magazines

Fitness Magazine (MRI Index: 172)

In Style (MRI Index: 168)

Runner’s World (MRI Index: 417)

Alternative Media:

Spray painted stencils and camera on running paths

Pandora Radio ads for while people are working out

Media Plan – Print Magazine

Media Plan – Print Magazine

Media Plan – Print Magazine

Alternative Media Creative Plan

For the alternative media, stencils will be spray painted on running pathways in major cities such as the Esplanade in Boston and Central Park in New York City. These stencils say motivational sayings such as “looking good” and “I’d run with you” with the lululemon logo included. Along the running trail there will be cameras that will ask runners to stop and pose for a camera that will ask them to “strike a pose.” This camera will capture the images and they will be posted on Facebook where users can find their image and tag themselves. The hope is to demonstrate confidence while working out and engage fitness enthusiasts. By posting the photos to Facebook we hope to draw attention from their friends when they see their friend tagged by lululemon.

Alternative Media Creative Plan Continued

Additionally a banner ad will be created for Pandora Radio. The goal and positioning of the ad is to target consumers who are listening to Pandora Radio while doing yoga or any other physical activity. The ad is a continuation of the “Strike a pose” campaign to remind consumers of the message of our campaign, which is to feel and look good while exercising.

Alternative Media Creative Plan Continued: Pandora Radio Ad

Appendix 1: Primary Research

Appendix 2: Primary Research

Appendix 3: Primary Research

Appendix 4: Primary Research

Appendix 5: Primary Research

Appendix 6: Primary Research

Appendix 7: Primary Research

Appendix 8: Primary Research

Appendix 9: Primary Research

Appendix 10: Primary Research

Bibliography

Bibliography: Continued

Bibliography: Continued

Bibliography: Continued