Abstract
This paper evaluates the current Internet strategies in use by the athletic wear giant Lululemon Athletica Inc. (NASDAQ:LULU) (TSX:LLL). Since its inception the company has shied away from traditional marketing strategies, preferring a grassroots approach, and its internet marketing strategy reflects these values. Lululemon distributes communications to its audience via an online shopping email blast that consumers sign up for, a Twitter feed, and a blog written and edited by Lululemon employees. The Lululemon corporate culture influences the content of the Lululemon brand communications directly as it disseminates an idea which in turn appeals philosophically to consumers.
Lululemon: Internet Strategies
Founder and current chairman Chip Wilson opened the original Lululemon store in the swish Vancouver neighborhood of Kitsilano Beach in the winter of 2000 (Lululemon Athletica n.d.). Wilson’s background and expertise lay in creating and designing serviceable fabrics for athletic wear, and he quickly saw a means to combine the philosophy of yoga, healthy living, and self-improvement into a profitable enterprise (Lululemon Athletica n.d.).
According to its company press release, Lululemon Athletica (NASDAQ:LULU; TSX:LLL) touts itself as a “yoga-inspired athletic apparel company that creates components for people to live longer, healthier and more fun lives.
By producing products that help keep people active and stress-free, Lululemon believes that the world will be a better place” (Lululemon Athletica 2011). The combined effect of “setting the bar in technical fabrics and functional designs” and working with “yogis and athletes in local communities for continuous research and product feedback” appears to be working well for the company in terms of growth and sustained profit (Lululemon Athletica 2011). Over a decade later Lululemon has grown to post fourth-quarter results of over 250 million (Lululemon Athletica 2011).
Since its inception the company has shied away from traditional marketing strategies, preferring a grassroots approach, and its internet marketing strategy reflects these values. Lululemon distributes communications to its audience via three Internet channels – an online shopping email blast that consumers sign up for, a Twitter feed, and a blog written and edited by Lululemon employees.
The Internet communications all imbue goal setting and self-improvement messages such as “dance, sing, floss and travel,” and “creativity is maximized when you’re living in the moment,” interspersed with pertinent sales information such as local discounts and athletic wear items reduced in price due to overstock (Lululemon Athletica n.d.). The brand’s Internet communications embody the philosophy of the company and the language of its Internet communications and site mirror the corporate culture. Such phrases as “shipping’s always on us,” and “the stretchiest and most colorful email you will receive all week, full of the latest product to hit our site,” disseminate the brand’s commitment to personal growth as part of its Internet communication strategy (Lululemon Athletica n.d.).
The Internet strategy also comprises a friendly, upbeat tone, as evidenced by the wording of the employee blog – “I am the Digital Content Storyteller and Blog Editor at our Store Support Centre in Vancouver, BC. I am an eternal optimist who lives up to my middle name. If you’re ever in Vancouver, you’re welcome to swing by my apartment. I’ll make us some tea and scones and hone my Scrabble skills on you. You better bring it (Lululemon Athletica n.d.).
Lululemon’s corporate culture influences the content of the Lululemon brand communications directly – in essence, Lululemon’s Internet strategy disseminates an idea. In the words of the New York Times Magazine, “anybody honest about consumer behavior knows that often what we buy is not simply something, but some idea that is embodied by that thing” (Walker 2009). Professors Dan Ariely and Michael Norton of Duke and Harvard respectively apply the term ”conceptual consumption” to this phenomenon.
Lululemon sells the concept of self-improvement piggybacking on yogic principles, or as Ariely and Norton would call it, the “consumption of goals…that may be relevant to the purchase of, say, a $128 jacket or a $48 T-shirt that is ‘yoga-inspired. With connotations of healthful living, mindfulness, and self-improvement, yoga is a pretty appealing concept (Walker 2009).
As a rule, Lululemon makes scant use of the Internet in its communication strategy. Its Internet strategy appears to play second string to its community-based communication, which “revolve…heavily around working with yoga instructors and offering free classes to draw in newbies” (Walker 2009). The brand’s current method is to establish the Lululemon presence in a community before it opens a store in that neighborhood. Typically Lululemon approaches athletes and fitness instructors from the chosen community and appoints them to the company’s “ambassador program” (Lazarus 2008).
These athletes then “test” the products and offer feedback on the style, design, functionality, and budding fitness trends as they pertain to certain lines of clothing. Once these ambassadors are on board, the company provides staff, communication materials, and support, and customers “to help the instructors build their businesses” (Lazarus 2008). According to current CEO Christine Day, Lululemon intends to boost sales in the upcoming year via its Internet communication strategies. “The strength of our business model and growing guest demand for our product allow us to accelerate our store and e-commerce channel growth in 2011 and to establish ourselves as the number one women’s athletic wear brand” (Lululemon Athletica n.d.).
Despite its modest usage of the Internet to reach its audience, Lululemon’s share price sits comfortably above its nearest competitor Nike (Daily Finance 2011). Nike, by contrast, has made full use of the Internet in its communications strategy (Story 2007). Nike’s Internet strategy creates a relationship with consumers, similar to Lululemon, however, Nike’s approach is more reciprocal, and creates an interactive relationship between consumers, products, and the web (Story 2007). An example is the Nike+, a tiny sensor that runners place in their running shoes that can help them track their training regimen (Story 2007).
At the end of every training session, runners dock their mobile devices into their computers and upload the particulars of their run onto the Nike+ site (Story 2007). In this way, Nike’s Internet strategy provides the conduit for community, all the while boosting sales and creating a long term relationship with consumers via the web. Runners who use Nike+ can make “friends with other runners around the world who post running routes, meet up in the real world, and encourage one another on the site.
Nike’s famous swoosh is there all along. For Nike, this is advertising. “It’s a very different way to connect with consumers,” says Trevor Edwards, Nike’s corporate vice president for global brand and category management. “People are coming into it on average three times a week. So we’re not having to go to them” (Story 2007).
Conclusion
Although Lululemon boasts a buoyant share price and impressive sales, its Internet communication strategy feels less focused than Nike’s, and if Lululemon truly wishes to boost online sales, this company’s Internet communication strategy needs to become more global and work to create a relationship with consumers all over the world, not simply within the sphere of local communities.
One way this might happen is to organize global yoga ambassadors who connect online and facilitate goal setting within a yoga practice on a much larger scale, using a Lululemon product as a bridge between consumer, product, company, and goal, similar to the Nike model. One of Lululemon’s main strengths its brand’s commitment to goal setting and self-improvement, so the Internet could become a means for the company to disseminate this idea while simultaneously helping consumers develop their fitness and mindfulness goals on a global scale.
References
Daily Finance (2011). Lululemon Athletica Inc. Top Competitors. DailyFinance.com. Web.
Lazarus, E. (2008). The Tao of Lululemon. Marketing Magazine, 113(6), 22-27.
Lululemon Athletica (n.d.) The Lululemon manifesto. Lululemon. Web.
Lululemon Athletica (n.d.). Company history. Lululemon. Web.
Lululemon Athletica (2011). Lululemon Athletica Inc. announces fourth quarter and full-year fiscal 2010 results. Lululemon. Web.
Story, L. (2007) The new advertising outlet: Your life. The New York Times. Web.
Taylor, L. C. (2010). Lululemon continues to roll up big profits. Toronto Star. Web.
Walker, R. (2009). Marketing pose. New York Times Magazine. Web.