How Lululemon Grew in a Dying Retail Landscape

Michael Beausoleil

Across the board, retail stores have been suffering due to the COVID-19 pandemic. This can be attributed to a number of factors such as: job losses, fear of going in public, and a lack of need for new items. Logically, all of these barriers should impact Lululemon, but somehow the brand is experiencing growth in 2020.

Lululemon is notorious for being a high-end brand. They’re often praised for the comfort and style of their clothing, but the price tag makes many shoppers scoff. Despite this, the brand has become synonymous with the “athlesiure” trend. This trend has maintained popularity in recent years, and Lululemon continues to be a staple in the casual and athletic markets.

Yet 2020 forced gyms to close and challenge our ways of exercising. It seems logical that Lululemon would feel an impact from this. Instead, the brand posted a 40% increase in value over 2019. Somehow, the luxury brand has built such a strong fanbase that it can maintain growth while other brands flounder.

The Challenging Retail Landscape in 2020

After half a year of shutdowns, quarantines, and social distancing, many retail stores remain closed. For the ones that have opened, the experience looks very different. Even for a brand like Lululemon who has reopened 97% of their stores, the closures have potential to stunt growth.
(Image via Alex Tai /GETTY IMAGES)

As the pandemic began, all physical retailers felt the burden of closed doors. At the beginning of the second quarter of 2020, clothing retailers had been hit especially hard: harder than any other retail category. Regardless of your opinion of the brand, it seems Lululemon should not be the exception.

Beyond retail closures, many other establishments shut their doors due to the pandemic such as offices, gyms, and many other public settings. Without gyms and common spaces used for physical activities, people had limited space to work out. While many people remained active indoors, there isn’t much urgency to purchase new workout clothes. There’s no one to judge you, no one to showcase new trends, and no exercises requiring specific garments.

To make matters worse, Lululemon has always viewed their stores as a community space. They offer classes and workshops for guests to attend. Their employees are known as “educators” and are responsible for crafting the customer experience. When a customer goes into the store, they get to do more than just browse. They try on clothing, get advice from employees, and can receive free garment adjustments.

On the surface, there’s no reason for Lululemon to remain successful in this environment. Their successes at the beginning of 2020 may have been due to pre-pandemic shopping. In the second quarter, they still boasted a 2% increase in earnings when compared to Q2 2019.

What Makes Lululemon So Special?

Like many successful brands, their success is a reflection of the way the brand views itself. For Lululemon, they are a lifestyle brand known for their comfort and durability. Their success is also a reflection of their public perception where they’re viewed as a trailblazer in the athleisure world.

As many employees have been working in the comfort of their homes, the emphasis shifts away from athletics and is placed on leisure. Lululemon makes clothing comfortable enough that people want to wear it all day. It’s presentable enough to be worn for daily use, so you won’t embarrass yourself when heading to the grocery story. Most items are non-restrictive, suitable for movement, but comfortable enough to sit in all day.
(Image Image via Lululemon)

In this climate, Lululemon represents the optimist’s outfit. Someone who will put in work, can handle the demands to children at home, might sneak in a work out, then needs to prepare dinner. A single outfit can do it all, but in a pre-pandemic world that same person would change outfits two or three times.

Lululemon may not have been trying to fit into this mold, but the brand has been finding its footing for over two decades. In this time, they have come to be defined by customers who can wear their clothings before, after, and during workouts. When your bed, office, and gym are all behind the same door, the seamless transitions will hold an appeal to many people.

By this point in time Lululemon has already established its presence in culture. Certain types of people will wear the clothing, and the brand’s logo is a bit of a status symbol. While being indoors, that logo holds little value, but the optimist in us hopes the pandemic will end soon. In many areas, restrictions are softening. Lululemon’s fans continued shopping with the brand hoping to show off their luxury gear once they can go in public again.

How Lululemon Keeps Their Momentum

It’s clear that direct-to-consumer, particularly eCommerce, has been the foundation of Lululemon’s successes in 2020. In fact, the company has seen a 157% growth in online sales over last year. While it shouldn’t be too surprising to see online sales flourishing in 2020, the brand shows no signs of slowing.
(image via CFO and Mirror)

Prior to the pandemic, shoppers would see an increase in products designed for the office or non-athletic settings. This is a natural expansion, but one that is challenged by remote working. Now, the company is focusing on at-home initiatives. Lululemon acquired the brand Mirror, a smart mirror that can be used to display workouts and at-home-training. At a cost of $1,500, it’s not cheap, but Lululemon was never a budget-friendly brand. This product competes with brands like Peloton who try to bring your favorite fitness classes into your home. This serves as a further signal for Lululemon’s direction: comfort at home.

Lululemon is also offering products to appeal to more customers. By the end of 2021 the brand plans to offer a wider range of sizes on most of its core products. As a company that offers form-fitting, and often revealing, clothing, Lululemon wants to represent more body types. As cultures shift toward body acceptance, Lululemon is trying to be part of the change.

Beyond these changes, the company seems to maintain a sense of optimism when looking toward the future. They’ve proven they can survive multiple challenges and hope to come out stronger in the end.

Customers: Their Key to Success

Above all, Lululemon knows their customers define their success. If you think of an upper-middle-class woman hopping from the office to a yoga class, she’s probably wearing something from Lululemon. This lies at the core of the brand, but they’ve catered their products to appeal to more customers.

(image via Lululemon)

The pandemic in 2020 has proven that Lululemon is truly a lifestyle brand. Their clothing is suitable for the gym, but comfort and durability is their priority. Sales don’t lie, and they’ve successes in those two areas. As the company sets their eyes on further expansion, they never lose sight of their central identity. They welcome more people to try their products and recognize shifts in culture and lifestyle.

Culture has often mocked the athleisure as a trend. Right now, Lululemon is able to laugh back. When the pandemic threaten the athletic side with gym closures, leisure became their selling point. Their clothing is comfortable and versatile enough to adapt to all the curveballs 2020 has thrown at us. Most of the brands primarily focused on athletics have seen sales decline. The focus on leisure has allowed Lululemon to experience growth during a time when people thought it would be impossible. There’s no guarantee for future successes, but so far Lululemon has already defied the odds.

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Writer, educator, and a few other things.

San Diego, CA

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