A successful fashion business doesn’t survive on rep alone. Digital Journal Fashion &Lifestyle editor, Julia Suppa, looks at the brand that has rocketed to a $224-million yoga-wear giant using smart design, the latest technology and karmic connections.
By Julia Suppa, Digital Journal
Few people would admit to standing in line for nearly an hour to get into a clothing store. But at a recent store opening on Toronto’s yuppie-chic Queen Street West, hundreds of people gathered outside in the summer’s heat to do just that. Wearing a myriad of form-fitting athletic wear — tanks, shorts and flip-flops — in a collection of shades and fabrics, they proudly displayed their rippled arms and svelte calves. Grinning and chattering anxiously, this crowd was not here for some simple window-shopping.
Blame the buzz on Lululemon Athletica. The multi-million dollar yoga apparel company had just opened up a new store with the hope of further expanding their empire.
It was six years ago when Lululemon first opened in Vancouver as a small, niche boutique catering to health-conscious, free-spirited folk. Since then, Lululemon has raked in $120 million in annual revenues and is being touted as the trendsetter of stylish athletic wear.
But few people understand the technological aspect of the brand. Lululemon prides itself on creating designs that flatter but also function. The company’s research and development team studies the latest fitness trends and implements new sewing techniques and fabric use for specialized activities like yoga, tennis, running, rock- climbing and dance.
“We see ourselves as a technology company,” says self-proclaimed “product guy” and founder Chip Wilson. He created the company after selling another local venture, Westbeach Snowboard, in 1997.
Lululemon is known for its proprietary synthetic fabric Luon, which combines nylon and Lycra to create a wicking and quick-drying cloth that feels like cotton. Clothes made with Luon keep their shape and colour, even after many washings.
“I hate being uncomfortable, so I’m always looking for ways to push the envelope with athletics,” Wilson explains. “Like technology products, we’re always trying to solve a problem…taking people’s requests and making them happen. Making the clothes look good is actually a secondary issue.”
Fabric developments like the company’s Silverescent line combines silver threading which is bound to fibres to create thermodynamic clothing. The fabric keeps you cooler in the summer and warmer in the winter. It’s anti-microbial, inhibiting the growth of odour-causing bacteria and fungus. Also impressive is its static reduction — what the company calls X-Static — caused by the silver embedded in the fabric.
Concepts like Silverescent and more organic fabrications like Vitasea — a seaweed compound made with wood pulp and fibre — demonstrate the company’s creative and technological motivation.
Lululemon designer Andrea Murray says the company strives to balance its core basic products — T-shirts and yoga pants — with innovative advancements.
“Technology can be combined in design, through pockets and ventilation, or though the fabric itself,” she says. “It’s a constant evolution.”
Along with fabrics like Silverescent, Lululemon touts its creatively designed hoodies with thumb holes, or jackets with concealed zipper pouches under the chin area.
But other major companies like Nike and Adidas have played the tech-fashion card too, capturing the interest (and sweat) of athletes with high-performance, dri-fit, flexible garments.
What makes Lululemon different, though, is what Wilson calls its “culture.” Wilson and Lululemon have created a lulu-lifestyle: a manifesto born from a group of yogis, dancers, runners and regular consumers who follow the brand like a religion.
“Lululemon’s clothing is perfect for us to throw on after dance and go home,” says principal dancer at the National Ballet of Canada and “Lulu Ambassador,” Greta Hodgkinson. “I can’t wait to see what’ll come out next for dancers.”
Will Lululemon Last?
With success come challenges, as any business will admit. As Lululemon expands its global reach, questions surface about whether the company can keep its down-to-earth attitude amidst competition. And will guys start wearing yoga wear as much as women do?
Lululemon executives say targeting men has always been on the company’s radar, but through feedback from customers, they’ve noticed more men have found the company on their own. One customer in Toronto admits his girlfriend first introduced him to the store, and now he’s not turning back.
“I’ve worn the three-quarter-length shorts and they’re perfect,” he says. “They’re comfortable but not revealing.”
How long can this joyride last? Is Lululemon just another trendy-today, gone-tomorrow brand?
The president of the Fashion Design Council of Canada doesn’t think so. “Lululemon has become an accepted part of lifestyle living,” says Robin Kay. “I’ve always supported the brand and I continue to support it…Chip Wilson is a visionary.”
Kay says while Lululemon had the benefit of being the first company to truly target the $3 billion (US) yoga wear industry, the company’s sustainability is not in question.
Rose Mastnak, strategic director and principal of Portrait Branding, a firm that studies company branding and corporate identity, agrees. In addition to gaining a head-start in the market, Mastnak says Lululemon has been able to stand out and prove themself.
“(Lululemon’s) technological innovations in fabrication and construction as related to yoga wear allowed them to have credibility in the market and to maintain and expand it,” says Mastnak.
Need proof? Just look at the numbers: To date, Lululemon operates 38 stores worldwide: 29 in Canada, seven in the U.S., one in Japan and another in Australia. Within the next year, stores will open in Florida, Texas and Washington, with four more scheduled to open in Tokyo. In all, Wilson says there are plans to open another 30 stores after this year, including much-anticipated expansions into Europe and Asia.
Wilson says revenues for the company have doubled every year for the past four years and are now estimated to be around $125 million. The total value of the company is valued at more than $224 million.
Interestingly, Lululemon doesn’t use any traditional forms of advertising, but relies on feedback from customers and professional yoga, dance and fitness instructors .
“I think there’s a difference between a commodity product versus a technical product,” says Wilson. “In our case, formalized advertising isn’t the effective way to go.”
But the company has taken a leap of faith by hiring fresh personnel. In January 2006, two Massachusetts-based capital firms bought a 48 per cent stake in Lululemon for about $108 million (US). The deal gave Lululemon an experienced CEO, Robert Meers, who headed Reebok from 1984 to 1999 and co-founded the $12-billion (US) office-supply store Staples.
Wilson says future growth of the company is imminent, but the main objectives right now are to scale down production and shift the company’s focus back to technical, core yoga wear, as well as specialized lines for dancers and runners.
“I never wanted to grow,” admits Wilson. “I wanted a simple store. But when you see what’s happening around you become so successful, it’s really grow or die.”
Fortunately for Lululemon Athletica and its devout followers, dying is neither an option nor a possibility.
