What Lessons Can Lululemon Learn From The Development Of UA Companies?

How did you find a niche? brand Is slowly rising up, not consciously close to ta?

When a brand can penetrate a small number of its customers, and gradually spread to a wider group of people in the same category, at a point you can't know, Bang! You will be surprised to find that the friends around you have the same brand of Logo.

According to the world clothing shoes and hats net, Adidas NMD (Xie Lv), Pandora (Zhu Bao), Daniel Wellington (watch), Canada Goose (cotton clothes)... Such explosions are numerous. Now, lululemon, a yoga brand from Canada, is trying to influence a larger audience through a handful of people in the same way.

Such a handful of people Lululemon Known as Community, more people in China are called "community".

In 1998, lululemon's first store opened next to a yoga hall in Canada. The product line only included expensive yoga mats and women's Yoga suits (a yoga pants for $88-98), aiming at a narrow range of yoga fitness people. In order to make the limited customers more sticky, lululemon began offering free sports courses such as yoga, running, fighting and so on in the store, and encouraged more people to walk into lululemon stores through sports.

Lululemon pays much attention to interaction with consumers. In lululemon stores, shop assistants are called "Educator" trainers. They will ask customers who come to the store "what kind of sports do they like?" and "how often do they exercise?" to select suitable products, and to play a guiding role in regular sports courses.

In terms of marketing, lululemon is also good at using KOL's role in brand communication. However, compared to Nike and Adidas's favorite sports stars, lululemon prefers to use the role of ordinary yoga instructors to influence consumers, such as finding 20 most popular yoga teachers, personal trainers and fitness trainers in the newly opened stores.

You can use all the keywords promoted in the consumer goods market in recent years to brand lululemon: user experience, sports and leisure (Athleisure), consumption upgrading, lifestyle... It is also carrying these waves, lululemon company has gradually extended its business from single ladies Yoga wear to running, riding, fitness training and boxing. After the replacement of CEO in 2013, it went on the line of men's wear products. Its revenue also increased from 18 million US dollars in 2004 to US $1 billion 800 million in 2015, the annual compound growth rate reached 52%, and the number of global stores has exceeded 300.

"How do we tell the outside world what lululemon is doing? It's not creating a trend, but creating emotional connections." Lululemon's CEO Laurent Potdevin has explained the strategy of the brand so well. Since 2013, lululemon has built a display space for products not sold in Beijing and Shanghai, and has set up a community team to educate domestic consumers first to achieve brand awareness.

After three years of market education, lululemon opened three stores in Shanghai and Beijing in December 2016.

Reporters also visited the store in the North District of Sanlitun, Beijing, at the beginning of the year. Although the shop area is small, the basic male and female yoga, running sportswear and yoga mat are all available, and a more special place is that all the shelves in the lululemon store are equipped with movable rollers, so that they can make room for the weekend and quickly turn the store into a small training ground.

Lululemon held an experiential activity at the foot of the Oriental Pearl Plaza in Shanghai: nearly a hundred fitness enthusiasts participated in a "dynamic bicycle" exercise course under the guidance of "Educator".

"We are very optimistic about China's market potential, including its contribution to our planning in the next 5 and 10 years. We believe that China will become one of our biggest markets in the future. Lululemon Asia Pacific brand & community director Amanda Casgar has said in a number of media interviews.

Despite its late arrival in the Chinese market, Lululemon still has great hopes for Chinese consumers. In the domestic sports brand market, from professional sports products to the whole category of sports brand, this development path will make it easy for people to connect to another brand, Under Armour (hereinafter referred to as "UA"). "Armour"

UA's famous experience has been described in previous articles, but in recent times, because of the damage of channels and the low status of spokespersons in NBA, UA's life is not easy: at the end of last year's 2016 quarter of fiscal year fourth quarter, the sales of the brand increased by 11.7% to 1 billion 310 million dollars over the three months ended December 31, 2016, which is the worst quarterly achievement of UA since its listing.

Compared to the UA that entered China in 2011, Lululemon naturally did not change from "niche" to "mainstream" expansion stage. What lessons can Lululemon learn from the development of UA companies? Reporters have counted the "holes" that UA has gone through, and summed up the following four points:

1, rely too much on spokesmen.

In the list of UA spokesmen, two sports stars are quite important. One is Stephen Currie, who was born in 2015 in 2015, and the other is the "flying fish" Phelps, who won 23 gold medals in the four Olympic Games.

However, after Phelps retired from the Rio Olympic Games, the whole American sports brand lost a sports veteran, but Stephen Currie, who was more dependent on UA, suffered a series of setbacks in the NBA arena. At the end of last season, the Jinzhou warriors, led by curi, were defeated by the Cavaliers and lost the championship. Then, the warriors added another general Durant after the Currie. The latter was the spokesman of another sports brand Nike.

The scenery of curi no longer directly affects the sales performance of UA. Dick Johnson Johnson, a well-known sports shoe retailer, Foot Locker, once pointed out at the group earnings analyst meeting that the Curry 3 listed in October 27th last year was slower than the previous two generation products, and sales began to slow down. In addition, the latest data of Nomura in Japan also showed that sales of the third generation of war boots in cooli declined significantly.

As mentioned above, at the present stage, lululemon prefers folk fitness enthusiasts to sports stars. However, with the expansion of lululemon in the product line and men's clothing category and the demand for rapidly opening up popularity in the Chinese market, it is not ruled out that the brand will find the next spokesperson in the regional market in the future. How to properly combine products with spokesmen is to insist on choosing professional sports people or entertainment stars who love fitness (such as Wu Yifan and Janine Chang of endorsement Adidas), which are the choices before lululemon.

2, over reliance on channels

After UA's performance at the end of last year, Waterloo's CEO Plank (Kevin Plank) attributed the first factor to the bankruptcy of us sporting goods retailers at the analyst conference. As UA accounts for 84% of total revenue in the North American market, and relies on downstream dealers in the business mode, when the number of sports retailers such as Sports Authority and City Sports is declared bankrupt, the disadvantages of UA's low inventory and low turnover begin to emerge. From 2012 to now, UA's stock turnover days are basically 120 days, compared with Nike's inventory turnover days about 80 days.

The retail industry in North America is also facing "cold winter". Many sports category retailers, including Sports Authority and City Sports, are unable to bear the burden of achievement and close down.

Lululemon has adopted the mode of "self marketing + direct selling" in its operation mode. 77% of the revenue comes from the self owned shops of the company, 16.5% comes from direct selling to the users (Tmall, Amazon, etc.), 6.2% comes from other channels including yoga clubs, and only a very small part of the business comes from the so-called wholesale channel, which helps lululemon to have absolute pricing power and good cash turnover rate.

In contrast, lululemon does not seem to have to worry about repeating the mistakes UA has made in the channel. But a reality is that the products currently available by lululemon are far lower than those of UA and Nike brands. With the extension of product lines and the expansion of more cities, lululemon is bound to break the existing direct system, deal with distributors everywhere, and establish a sound distribution system, and how to distribute the proportion of direct and wholesale products, which is a difficult problem for lululemon to deal with next. Lululemon

3, pay too much attention to functional attributes.

Whether it is UA's fast dry tights or Curry's three generation basketball shoes series, the main products are functional products based on Sports scenes, but product strategies such as purely functional attributes are facing challenges.

For consumers, sports and leisure fashions make the clothing of the gym suitable for more occasions, which means that brands such as UA and lululemon add more fashion elements to the function of the product. UA's CEO Kevin Plank has realized the problem and seeks to change. "Consumers may still be going to fitness like a college athlete, but they also want to go to the gym to look better," he said at an investor conference.

And open the official home page of lululemon, you will find that the basic tone of black, white and gray still occupy most of the products. Although the brand can still rely on the basic funds in the market, but with the rise of the young consumer groups and Nike, Adidas and other brands on the Yoga market eyeing, it is hard to guarantee that the latter will not launch a more design sense of Yoga wear and lululemon.

From lululemon's Tmall products page, the brand is still dominated by professional sportswear.

4, over epidemic

Since its entry into the Chinese market in 2011, UA has opened nearly 120 stores in China, and the location of shops has also gone from north to Yinchuan to Zhengzhou, Ji'nan and other two or three tier cities. But compared with consumers' familiarity with Nike and Adidas's huge product line, when talking about UA, most people's cognition is still limited to "this is a fast drying clothes brand".

Lululemon is also undergoing such a process. Although the brand is not known in the mass sports market in China, lululemon brand is no longer fresh in the field of yoga. In the yoga video course of the fitness community Keep, almost every yoga mat used by yoga instructors has a distinctive lululemon logo. If you ask your friends about the impression of lululemon, most of the responses will still be: "Yoga suit brand".

The popularity of the vertical market helps to spread the brand in the early days, but when UA and lululemon gradually add products such as running, ball, boxing and so on, they need to find ways to get rid of their professional labels in the field of vertical sports -- for larger market scale and wider consumer trust.

However, every kind of "fashion" will hide some kind of damage to the brand, and consumers have a natural love for the "minority". Once the minority brands have access to the mainstream track, loyal consumers may turn to the new "niche" brand.

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