From Share to Shelf

Lulu

LuluLemon Athletica know their customers and they know them well. They identify their target market saying:

“Our primary target customer is a sophisticated and educated woman who understands the importance of an active, healthy lifestyle. She is increasingly tasked with the dual responsibilities of career and family and is constantly challenged to balance her work, life and health. We believe she pursues exercise to achieve physical fitness and inner peace” (LuluLemon Athletica, 2014: 2).

 

What’s particularly noteworthy is LuluLemon’s marketing strategy and approach to market research.

I found LuluLemon’s community based marketing approach to be particularly interesting in that they utilise grass roots activities such as in store community notice boards, community events and a strategic sales program to reach their target market. Having never seen an ad for LuluLemon I was naturally curious how the brand had become so successful in Australia so quickly. When I learned of their strategic sales program it became pretty clear. The strategic sales program was designed to create partnerships with carefully selected local health and yoga studio’s to feature LuluLemon’s apparel and yoga equipment.

Part of this strategic sales program involved getting fitness professionals wearing their products in leading fitness studios at discounted prices in return for their feedback and ideas. The Hey LuluLemon website is dedicated to seeking customer feedback on all aspects through polling about store experience, new products styles, colours, launch dates and new ideas. The Hey LuluLemon concept of “from share to shelf” which engages those participating the strategic sales program is a unique approach to market research.

Regular polls on the website seek specific feedback for example on a favourite product – recently there was “the showdown” where five new products were shown and collaborators were asked to vote on their favourite. Polling revealed that the “Savasna Wrap” was the most popular product and a short time later there was further polling to determine which inspirational quote would make it on to the new wrap. Finally, a drop date poll was launched to determine the preferred launch dates for the product – either before the start of winter as it starts to cool down or in later months when winter is well and truly upon us. In other polls, collaborators were asked to indicate their favourite colours for the season and what improvements they’d like to see to existing products – in case you’re wondering, its bigger pockets to accommodate their new iPhone 6! All of this information feeds directly into the LuluLemon R&D team and transpires into the products we see on their shelves.

This online collaboration is key to LuluLemon in determining specifically which products to launch (and which not to launch) as well as when and how to launch them. LuluLemon clearly know their targeted segment of customers and are working very closely with them to develop and place new products. This approach is clearly working with LuluLemon reporting a net revenue compound annual growth rate of 50% year on year between 2004 and 2013 (LuluLemon Athletica, 2014: 1).

What other market research approaches could LuluLemon use to better fulfil the needs of customers in their existing target markets?

 

http://www.lululemon.com.au/

https://www.heylululemon.com/welcome

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11 thoughts on “From Share to Shelf

  1. I love LuluLemon! I love their products because all of those little things that annoy me when I exercise have been listened to, and taken care of, in their products. For example, I can fit my phone in the pocket of my running pants AND they don’t fall down on a run. Plus they are not too tight around the waist so as not to give me “love handles” – all these things that are important to self-conscious women. I can’t believe that other companies have not done this before, and I do agree with you that this is what has made LuluLemon so successful -their products may be twice the price, but I am now brand loyal! The other main difference that I noticed, is that their stores are staffed by incredible helpful and knowledgeable employees. They strike a great balance in advising of complimentary products without coming across as salsey or pushy. I find that I might go into a store for a pair of running pants, but come out with a yoga mat, singlet top and running jacket – and be incredibly happy about it! I think LuluLemon have their research strategy spot on, and as long as they keep moving with the times (and keeping in touch with their segment) I have no doubt they will continue to grow and be even more successful.

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  2. Good Topic to choose….
    Target marketing is the most current method of marketing to consumers based on research into their interests, hobbies, and needs, and it didn’t spring from nothing. Before we got here, advertisers and marketers were using cohort marketing, and before that they were using generational marketing. Target marketing is essentially a refinement of these ideas.
    1. Generational marketing
    2.Cohort Marketing

    At the bare minimum, these are the things you should know about your target customers:-
    What is their gender?
    How old they are?
    What are their interest or hobbies?
    Where do they live?
    How much money do they make?

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  3. i think the company i said is doing very well , however to stay ahead of competition it can use MDS (multidimensional scaling). as MDS helps to know the similarity between us and our competitors and also which aspects do the customers weigh the most further we can know which aspect are we good at and which aspect do we need to work upon. hence, by taking correcting measures on the unfavorable aspects on time can keep us invincible!

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  4. Sounds like LuluLemon have it covered in terms of knowing their market, but I guess it is always pertinent to stay on top of the game by looking around at whatever other market research methods they can use or adapt to serve their purpose. The word-of-mouth advertising from shanynp had me intrigued – sounds like the kind of exercise gear I need – yet I have never heard of LuluLemon until this blog. I don’t tend to frequent the places where I would be more likely to encounter the brand. I will also confess to not being the world’s greatest shopper of anything really – don’t have the right combination of time and money – but if I do happen on a brand I like I tend to stick with them. What else could they do? Maybe tackle the horde of those like me who tend to walk around the local neighbourhood in pretty awful clothing hoping we aren’t recognised. Why don’t we do something about ourselves?

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  5. @lferguss
    Supposedly, I find your comment more humourous than any other comment i have read in marekting management blog. Good work on the policy of “Being Honest”. Frankly speaking, even this is my first time when i have come across a brand ‘LuluLemon’. Then i did some research on them, and the first thing i noticed about them is their high price, and what i personally feel if they want to target more customers who are already loyal to a different brand like me and @lferguss and rest of the crowd, I suppose, a decrease in their product price could help.

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  6. I also love Lululemon stuff but haven’t bought any as they are very expensive. I heard about them via word of mouth from one friend who wears their products. So I guess the word is getting out there and it is not costing them much at all!

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  7. Looking at their high prices and no ads obviously they are targeting a niche market of women and focusing on them to deliver everything they expect
    Two way communication and partnership with gyms are sufficient to understand their customers’ needs, and going beyond with their online collaboration in shaping their new products is great
    Perhaps having an app that targets their segment where they can choose the colour, size, shape, features … of a pants for example, will help in understanding the customer’s requirements more

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  8. Hi there, the heylululemon site is very interesting!! And it’s good to know the lululemon has probably done some great market research, including a segmentation study, which has given them such a clear target of customers.

    I agree with @kdhawan2015 that customer information is definitely important, which could help forecast demand and determine responses to marketing changes (Iacobucci 2014), but I don’t quite think MDS is needed at this stage, as suggested by @askamboj, because MDS is more useful to reposition a brand. Given lululemon has been quite successful so far, there is no need for them to reposition. That said, an attribute based perceptual mapping will probably help to clarify what lululemon’s target customers think and what variables are important. Combining this with social media monitoring will probably help bring lululemon to the next level, as social media could in a way bring context to what the perceptual map find. You may want to find out more about this method from one of the largest market research company in the world:
    http://www.tns-opinion.com/expertise/social-media-analytics

    Cheers,
    Nathalie

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  9. I just read an article about Lululemon saying that it has entered the menswear business in order to attract male segment especially who wish to have more bike-seat comfort. Lululemon’s yoga pants have shifted its focus from butt-boosting black tights to package-protecting pants for men, indicating that Lululemon is evolving and the sales continue to increase. According to the product description, the new pants intend to give ‘the family jewels room to breathe’, therefore the ‘anti-ball crushing’ (ABC) pants advertise a slim-fit style to ensure ‘your pants and your bike chain won’t cross paths’. This may come as good news to men who have not yet heard of the ABC pants and want to experience a ‘wide panelled gusset’ themselves. However, despite the fact that the pants are considered to be anatomy-friendly, the price of $128 seems to be high. Also, a key consideration in such expansion is that size will matter in the long term, if the marketing falls short. Therefore, if Lululemon puts the right marketing strategy behind its ABCs, they could become its crown jewel of menswear.

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