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Lululemon

lululemon athletica inc.
TypePublic
ISINUS5500211090
IndustryRetail
Founded1998; 24 years ago (1998)
FounderChip Wilson
Headquarters
Vancouver, British Columbia
,
Canada[1]
Number of locations
574 (Dec 2021)[1]
Area served
North America, Asia, Europe, Oceania
Key people
  • Calvin McDonald (CEO)
  • Glenn Murphy (chairman)
  • Meghan Frank (CFO)
  • Sun Choe (CPO)
  • Celeste Burgoyne (EVP, Americas)
  • Rana (APAC)
ProductsSportswear
BrandsLab
RevenueIncrease US$6.26 billion (2021)[1]
Increase US$1.33 billion (2021)[1]
Increase US$975.3 million (2021)[1]
Total assetsIncrease US$4.94 billion (2021)[1]
Total equityIncrease US$2.74 billion (2021)[1]
Number of employees
29,000 (Jan 2022)[1]
Divisions
  • Lululemon Athletica
  • OQOQO
  • Ivivva Athletica
Websitelululemon.com
Footnotes / references
[1]

lululemon athletica inc. (/ˌluːluˈlɛmən/; styled in all lowercase[1]) is a U.S.-Canadian[2] athletic apparel retailer headquartered in British Columbia and incorporated in Delaware. It was founded in 1998 as a retailer of yoga pants and other yoga wear, and has expanded to also sell athletic wear, lifestyle apparel, accessories, and personal care products. The company has 574 stores internationally, and also sells online.

History

Lululemon was founded in 1998 by Chip Wilson in Vancouver, British Columbia, Canada, with its first standalone store opening in November 2000.[3][4] Wilson created the name to have many L's so that it would sound western to Japanese buyers, who often have difficulty pronouncing the letter. He later remarked that he found it "funny to watch try and say it".[5]

The company's initial public offering was in July 2007, raising $327.6 million by selling 18.2 million shares.[6][7] Christine Day, a former co-president of Starbucks, became chief executive officer in 2008.[6]

In 2013, the company made its third consecutive appearance on Fortune's Fastest-Growing Companies list.[6] In December 2013, founder Chip Wilson announced his resignation as chairman, and that the president of TOMS Shoes, Laurent Potdevin, would become CEO.[8]

In 2014, Lululemon opened its first store in Europe, a flagship shop in Covent Garden, London.[9] In February 2015, Wilson announced that he was resigning from the board,[10][11] and that Michael Casey, former lead director of the board, would replace him.[12] In 2018, Laurent Potdevin resigned as CEO and from the company's board due to misconduct.[13][14]

In 2019, Lululemon announced an investment in MIRROR, a fitness startup that sells an interactive mirror with a camera and speakers for at-home workouts. The companies planned to create new content for the device, starting with meditation classes.[15] In June 2020, Lululemon announced a $500 million deal to purchase MIRROR, capitalizing on a growing trend of people conducting virtual workouts at home instead of going to a gym due to the COVID-19 pandemic.[16]

Management

From its founding through 2015, Lululemon incorporated elements of Landmark Forum into its leadership and development training.[17] According to a company source, seventy per cent of managers are hired internally.[18] Store managers are responsible for their store's layout, color coordination, and community involvement.[18]

Products

Lululemon sells athletic wear including tops, yoga pants, shorts, sweaters, jackets and undergarments,[4] as well as hair accessories, bags, yoga mats, water bottles, and personal care products such as deodorant and dry shampoo.[19] Lululemon trademarked its original fabric, Luon, which included a higher-than-average amount of nylon microfiber, in 2005.[4] Since then, the company has produced several different types of fabrics, including compression and moisture-wicking designs.[4] Lululemon is primarily known for their leggings, which first made the brand popular.

Lululemon maintains a research and development lab, "Whitespace," within its headquarters. It has around 50 employees including scientists and physiologists.[4][20]

In 2019, the company launched a luxury streetwear brand called Lab in a few of its stores.[21] In The company planned to double its men's business in the next five years beyond its women's and accessory business, competing against other athletic wear such as Nike and Under Armour.[22]

Marketing

Two Lululemon stores with their products in exhibition, (left) Promenade; (right): Hong Kong

Originally known for women's yoga apparel, by 2019 Lululemon had grown by acquiring more male customers, adapting its product and marketing strategies accordingly, and plans to increase awareness of the brand among men.[23] The company has been stated to use "holistic guerrilla marketing", aiming to make customers feel that by wearing Lululemon clothing they are part of a larger community.[24] Lululemon uses social media including Facebook, Twitter and Instagram as one of its main methods of marketing the company and its products. Lululemon also has its "Sweat Collective" which allows for instructors of fitness to receive 25 percent off their order.[25]

Lululemon has a wide network of stores around the world with 270 as of 2018. It also sells all its products online to provide customers with a better shopping experience. In terms of product development, Lululemon is also trying to develop new fabrics to provide customers with more comfortable use experience, like their Nulu fabric. Lululemon also increased its liquidity by 2018, making it easier to raise capital and capture market growth opportunities.[26]

Controversies

False advertising

In November 2007, The New York Times reported that Lululemon made false claims about its Vitasea clothing product; the firm had claimed that the clothing, made from seaweed, provided "anti-inflammatory, antibacterial, hydrating and detoxifying benefits"[27] but laboratory tests failed to find significant differences in mineral levels between ordinary T-shirt cotton and Vitasea fabric.[27] Lululemon was subsequently forced to remove all health claims from its seaweed-based products marketed in Canada, following a demand from a Canadian oversight agency, the Competition Bureau of Canada.[28]

Product quality

In 2013, some customers complained that the clothing was of poor quality, with some items being "too sheer", having holes appear, and falling apart after a few uses.[29][30] In December 2010, Lululemon recalled some of the store's reusable bags that were made from polypropylene, based on reports of high levels of lead.[31] In 2013, Lululemon recalled its black yoga pants that were unintentionally transparent and "too thin";[32][33] the recall, which amounted to approximately 17 percent of all women's pants sold in its stores, impacted its financial results.[34] The resulting financial loss and damage to the brand led to the forced departure of the company's Chief product officer, Sheree Waterson,[35][6] and of its CEO, Christine Day.[6][36]

Founder's statements

Founder Chip Wilson has made numerous controversial statements. In a 2004 interview, Wilson mocked Japanese pronunciation of the company's name.[37] In 2013 he said that the company did not make clothes for plus-size women because it was too costly.[38] In an effort to explain away excessive pilling in the brand's clothing, he blamed some customers for wearing Lululemon's clothes improperly or for having body shapes inconsistent with his clothes.[39] In an interview for Bloomberg TV in 2013, he stated that some women's bodies were unsuitable for the brand's clothing.[39] Time called the remarks "fat shaming".[40]

Comments such as these reportedly led to Wilson's resignation as chairman.[41] In June 2016, Wilson published an open letter to shareholders stating that the company had "lost its way" and given up market share to Nike and Under Armour, after he was denied the opportunity to speak at the company's annual meetings.[42][43] Since then, Wilson has used his website "Elevate Lululemon" to criticize the brand and business.[44][45]

Legal disputes

In 2012, Lululemon filed a lawsuit against Calvin Klein and supplier G-III Apparel Group for infringement of three of its design patents for yoga pants.[46] The lawsuit was somewhat unusual as it involved a designer seeking to assert intellectual property protection in clothing through patent rights. The case was settled out of court the same year.[47]

All Lives Matter

In 2021, a Business Insider report revealed that an unnamed company director pushed employees to create an All Lives Matter campaign to be displayed on its website in response to the murder of George Floyd. Employees pushed back but were told to move forward and create a mock up with the All Lives Matter copy, however they also created a Black Lives Matter artwork mock up that in the end was selected instead. The director apologized to 200 members of the company over conference call and subsequently left the company.[48][49]

See also

References

  1. ^ a b c d e f g h i j "Form 10-K – lululemon athletica inc". U.S. Securities and Exchange Commission. March 29, 2022.
  2. ^ "LULU Stock - Lululemon Athletica Inc. SEC Filings".
  3. ^ Rob Walker, July 21, 2009, "Marketing Pose", The New York Times, Retrieved . "...it's no surprise that some yoga devotees have zeroed in on it as an annoying phony-baloney symbol. Elaine Lipson, a writer and editor in Boulder, Colo., who ..."
  4. ^ a b c d e Bhasin, Kim Jr.; Porter, Gerald. "The rise of lululemon: How America became a nation of yoga pants". Chicago Tribune. Retrieved November 5, 2018.
  5. ^ Edwards, Jim (September 4, 2015). "The long, strange history of lululemon: North America's weirdest clothing brand". Business Insider. Retrieved April 24, 2020.
  6. ^ a b c d e "Lululemon: In an uncomfortable position". Fortune. Retrieved November 1, 2018.
  7. ^ Ball, Yvonne. "lululemon IPO Runs Up 56%". The Wall Street Journal. Retrieved November 1, 2018.
  8. ^ Stock, Kyle (December 10, 2013). "Lululemon's Founder Exits and a Snowboard Exec Enters". Bloomberg News. Archived from the original on August 5, 2022.
  9. ^ Suzanne Bearne, Drapers."lululemon limbers up to open first UK store in Covent Garden." February 20, 2014. February 4, 2015.
  10. ^ "Power shifts at lululemon as Chip Wilson seals deal". The Globe and Mail. June 11, 2014.
  11. ^ Michael Calia, February 2, 2015, Wall Street Journal, lululemon Founder Wilson Quits Board: Resignation Comes About Six Months After Disagreement Was Settled on Yoga-Apparel Maker’s Strategy. Retrieved May 6, 2015
  12. ^ Huffington Post, Chip Wilson Leaving lululemon
  13. ^ D'Innocenzio, Anne. "lululemon's CEO resigns over issue of conduct". Chicago Tribune. Retrieved February 6, 2018.
  14. ^ Thomas, Christina; Farr, Lauren; Hirsch, Lauren (February 6, 2018). "lululemon CEO left in part because of relationship with female designer at the company". CNBC. Retrieved July 15, 2018.
  15. ^ Hanbury, Mary. "lululemon just made a bet that the $1,500 interactive workout Mirror is the future of fitness, and it should terrify boutique workout studios". Business Insider. Retrieved October 31, 2019.
  16. ^ Terlep, Sharon (June 30, 2020). "Lululemon Buys Mirror, an At-Home Fitness Startup, for $500 Million". The Wall Street Journal. Retrieved June 30, 2020.
  17. ^ Lieber, Chavie (January 9, 2014). "The Self-Help Movement Behind Lululemon's Eerie Dogma". Racked. Retrieved October 7, 2019.
  18. ^ a b "CEO: How to build trust inside your company". CNN Money. Archived from the original on November 27, 2012. Retrieved October 18, 2012.
  19. ^ "Women's Accessories". lululemon.
  20. ^ Ankeny, Matthew (October 2, 2015). "The Metaphysical Thought of Lululemon's Athletic R&D". gear patrol.com. Retrieved October 2, 2015.
  21. ^ Segran, Elizabeth (September 10, 2019). "lululemon's first new brand, 10 years in the making, is here". Fast Company. Retrieved September 13, 2019.
  22. ^ Bhattarai, Abha. "Lululemon sold women on $100 leggings. Now it's coming after men, with $38 boxers". The Washington Post. ISSN 0190-8286. Retrieved April 9, 2021.
  23. ^ Stankiewicz, Kevin (October 29, 2019). "Lululemon CEO: To really pop our menswear line, more men need to know we actually have one". CNBC.
  24. ^ "LOCO FOR LULU". Canadian Business. 84: 28–32. May 2011. ProQuest 865046155.
  25. ^ Touchette, Ben; Schanski, Megan; Lee, Seung-Eun (2015). "Apparel brands' use of Facebook: an exploratory content analysis of branded entertainment". Journal of Fashion Marketing and Management. 19 (2): 107–119. doi:10.1108/JFMM-04-2013-0051.
  26. ^ lululemon athletica inc. SWOT Analysis. (2021). Lululemon Athletica Inc. SWOT Analysis, 1–7.
  27. ^ a b Story, Louise (November 14, 2007). "Seaweed Clothing Has None, Tests Show". The New York Times.
  28. ^ "Lululemon VitaSea Clothing: Competition Bureau Takes Action to Ensure Unsubstantiated Claims Removed from Lululemon Clothing". Competition Bureau. Retrieved November 16, 2007.
  29. ^ "What Lululemon's revealing pants say about yoga". Los Angeles Times. "It seems that Lululemon, the Vancouver-based company, had to recall some of its yoga pants because they are too sheer. This is not, it turns out, a minor problem. ...it's not just the adorably named Lululemon that has a problem with see-through yoga pants. Many brands, when stretched just so, are sheer."
  30. ^ Michelle Chapman, AP Business Writer, November 1, 2013, USA Today, "New quality complaints about Lululemon pants: Just a few months after company pulled yoga wear from shelves, new quality issues arise". Retrieved May 6, 2015, "...New yoga pants ... recent complaints ... still too sheer... pants pilling after a few months of wear – or even just a few uses – and about holes and seams coming apart..."
  31. ^ Sinnema, Jodie (December 21, 2010). "Lululemon issues recall for shopping bags due to lead risk". Edmonton Journal. Retrieved May 6, 2015. People who purchase yoga pants, hoodies or headbands from the more than 100 Lululemon stores in Canada, the U.S. and Australia often save such bags to carry their lunches to work
  32. ^ February 13, 2015, BBC, 'Yoga pants': Are leggings and other tight trousers indecent? Are yoga pants a threat to public decency? It might seem so after the beloved athletic wear once again made headlines – this time after a lawmaker debating public decency said the pants "should be illegal".. Retrieved May 11, 2015, "...2013 when Lululemon, a large clothes retailer, had to recall many of its leggings ... sheerness ..."
  33. ^ June 10, 2013, Tiffany Hsu, Los Angeles Times, Lululemon CEO Christine Day to step down after sheer-pants scandal. Retrieved May 6, 2015, "...The so-called Pantsgate scandal, in which Lululemon pulled all of its black yoga bottoms in March after deeming the luon fabric to be too thin,..."
  34. ^ Isidore, Chris (March 19, 2013). "See-through pants problem causes Lululemon recall". CNN Money.
  35. ^ "Lessons Learned from the Lululemon Recall". The National Law Review. Risk and Insurance Management Society, Inc. (RIMS). Retrieved April 10, 2013.
  36. ^ Meier, Fred (June 10, 2013). "Stunner: Lululemon CEO Christine Day leaving". USA Today.
  37. ^ "Lululemon founder Chip Wilson's 5 most controversial quotes". Financial Post. December 10, 2013. Retrieved July 15, 2018.
  38. ^ Bhasin, Kim (July 31, 2013). "Shunning Plus-Size Shoppers Is Key To Lululemon's Strategy, Insiders Say". HuffPost. Retrieved April 13, 2014.
  39. ^ a b "Outrageous Remarks By Lululemon Founder Chip Wilson". Business Insider. December 10, 2013.
  40. ^ Eliana Dockterman, November 13, 2013, Time magazine, "What Lululemon Could Learn From Abercrombie About Fat Shaming: A co-founder of Lululemon said his yoga pants just aren’t built for 'some women's bodies.' That's just a bad business decision". Retrieved May 6, 2015, "Clearly the feminist arguments against fat shaming are falling on deaf ears at Lululemon ... torrent of criticism hasn't inspired Wilson to change his tune."
  41. ^ Kim, Eun Kyung (December 10, 2013). "Lululemon co-founder steps down in wake of 'women's bodies' remark". Today.com.
  42. ^ "Lululemon Founder Slams Company, Now That He's Allowed To". BuzzFeed. Retrieved June 3, 2016.
  43. ^ Mau, Dhani (June 2, 2016). "Lululemon Founder Chip Wilson Created a Whole Website to Criticize the Company". fashionista.com. Fashionista. Retrieved June 3, 2016.
  44. ^ "Lululemon Founder Chip Wilson Created a Whole Website to Criticize the Company". fashionista.com. Retrieved February 15, 2017.
  45. ^ "Elevate lululemon". Elevatelululemon.com. Archived from the original on February 15, 2017. Retrieved February 15, 2017.
  46. ^ Weller, Susan Neuberger (September 21, 2012). "S. 3523: Louboutin, Lululemon, and Fashion Design: Finally Getting Some Respect?". The National Law Review.
  47. ^ Weller, Susan Neuberger (November 27, 2012). "Lululemon and Calvin Klein Settle Yoga Pants Design Litigation". The National Law Review.
  48. ^ Elan, Priya (July 2, 2021). "Lululemon 'pushed for All Lives Matter' campaign". The Guardian. Retrieved July 3, 2021.
  49. ^ Hroncich, Caroline; Biron, Bethany (July 2, 2021). "'Privileged white wellness': Lululemon corporate employees speak out on the culture of racial insensitivity". Business Insider. Retrieved July 26, 2021.

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