How can niche brands gradually become popular and attract more and more consumers to follow?
A Canadian sports brand, Lululemon (NASDAQ: LULU, also translated as "Lululemon Athletica"), which is famous for producing women's yoga clothes, is driving greater market potential by infiltrating a "small group" of customers. It not only establishes long-term emotional ties with customers through community operations, but also achieves "profit growth" in 2016 after expanding the men's clothing product line, with revenue increasing by 14% to $421 million year-on-year, Net profit increased by 14% year-on-year to $2.3 billion. At present, the brand has a total of over 300 stores worldwide.
With outstanding performance, Lululemon stands out in the field of professional leisure sports. Behind them are not only international giants such as Adidas and Nike chasing after them, but also fashion giants such as Victoria's Secret (hereinafter referred to as "Weimi") in the food distribution market.
The success of Lululemon has brought imagination to domestic brands: in the fiercely competitive sports and leisure market, trendsetters far surpass catchers. That is to gradually break through the single attribute of "sports" and become a necessity for the mainstream lifestyle.
Precise positioning, "prying open" the female yoga clothing market
Chip Wilson, founder of Lululemon, is a yoga enthusiast himself. When he participated in a yoga training in 1998, he found that most of the students were wearing cotton polyester blended fabric Sportswear, neither close to the body nor absorbing sweat; And the women's version is even more simple and rough, to the point of "reducing the size of the men's version and adding feminine colors".
Wilson believed that "women simply don't want to exercise wearing unsuitable T-shirts", so he created a black women's yoga pants using lightweight and snug textile materials. In the same year, he founded Lululemon in Vancouver, which includes a small design studio, retail store, and yoga training center.
Subsequently, he personally developed the product and extensively collected customer feedback from Lululemon Yoga Studio, referencing and improving various body shape characteristics in design. If the tight vest is stretched out and worn with yoga pants, it can cover some of the buttocks; With unique designs such as "dark pockets", "double sided wear", and "night flashing", Lululemon quickly stands out in the monotonous cotton yoga suit market with practicality, comfort, and a sense of technology.
Lululemon has won substantial returns by providing precise services to the vertical segmented market of women's yoga suits during its start-up period. Listed on NASDAQ in 2007, sales jumped by 85% within 9 years to $275 million; Net profit surged 300% to $31 million.
After its launch, Lululemon began its first round of expansion to attract more yoga loving women to know it. In 2008, it had over 100 stores, and in addition to Canada, the United States, Australia, and Hong Kong, China, it can also be seen.
"When I was in the United States, most of the people in the yoga classroom I went to wore Lululemon, all of whom were living models. Because its products were comfortable and beautiful, they were completely different from the traditional Sportswear, which was' more function than fashion '." Shi Yi, a returned girl, is Lululemon's "iron powder". She often patronizes many stores to find suitable size sportswear.
But unique products alone are not enough. Due to Lululemon's exclusive yoga training center, Wilson naturally values the influence of yoga coaches on student consumers. In store operations, Wilson requires store staff to act as "educators" (trainers) to enhance interaction with customers. They will ask each customer 'what kind of exercise they like' and 'how often do they exercise regularly' to help them choose suitable products, and serve as exclusive coaches in regular sports courses held by the store. In these perennial training courses, Lululemon has gained a large number of fans by promoting the concept and methods of health sports. In addition, the precise positioning of channel marketing has resulted in almost no investment in promotion costs.
Wilson firmly believes that good products themselves require "story" support, and at that time there were not many sports brands that could accurately capture the "emotional demands" of female consumers for sports products, which gave Lululemon more opportunities. We strive to create a warm and happy 'community' feeling for our customers, so that consumers and brands are no longer just buying and selling relationships, but more like girlfriends. They come here like 'gatherings', and shopping is just a daily habit, "Wilson said.
 
Community operation, building competitive barriers for lifestyle brands
Speaking of this, do you feel that Lululemon captures the emotional demands of female consumers, which is a bit like the "user centric" internet mindset?
In fact, in addition to accurately focusing on the female market and selling the right products, another outstanding feature of Lululemon is its "community operation", which is close to the concept of "community" in China.
In addition to yoga, we are also passionate about helping clients establish a lifestyle attitude they have long enjoyed, "explains Laura Klauberg, senior vice president of community and brand development at Lululemon. We call this attitude" sweet life ", which means sweating profusely through beautiful exercise and conveying a healthy and fashionable lifestyle taste with a sunny attitude.
In terms of marketing, Lululemon does not have a marketing department, does not advertise, and does not hire celebrity endorsements. However, it has also established a strategy that matches the "lifestyle" brand positioning:
Strategy 1: Price=Style. According to research data from market research company ThinkEquity Partners, the price of Lululemon is already high-end in the field of sports goods, with a pair of yoga pants costing $92, Nike products in the same category costing only $60, and Under Armour products costing only $70. Wilson summarized the Lululemon brand tone as a "functional fashion trendy brand", which is more fashionable than UA and more vertical and practical than Nike's "pan fitness" positioning.
During economic downturns, the most high-end clothing brands often have the greatest impact, but Lululemon is a trendy brand at a high price point, especially in North America where many women consider it as their daily wear to demonstrate their level of consumption. When compared to top tier clothing, Lululemon is not very high, which gives it more pricing power among white-collar women aged 32 to 40.
Strategy 2: widely use Opinion leader for promotion. Initially, Lululemon worked with yoga coaches to create a community atmosphere for customers, accumulating a large number of fans in a short period of time, and standing out from numerous sports brands. Later, Wilson came up with a new way to play: every time he developed into a city, he would find 20 local most popular yoga teachers and provide them with free clothes, so that the brand would radiate in the social circle of these individual Opinion leader.
Wilson referred to the above approach as "building a community", which essentially belongs to experiential marketing - allowing consumers to understand Lululemon products, brands, and concepts through yoga training sessions, while delving deeper into new market consumer groups and gaining insights into their consumption habits and lifestyle habits. This is the biggest difference between it and Adidas, Nike, and others who often spend billions of dollars hiring sports stars for promotion: widely leveraging fans and KOL power to make consumers perceive the brand and collect consumer feedback to continuously improve the product.
Strategy 3: Open a temporary experience display store. This also stems from Lululemon's "community culture". Since its main way of promoting the brand is "user community", the experience exhibition stores (show rooms) established in various places can be regarded as an upgraded version of the "Pop-up retail" of "user community", which is specially used to communicate with customers, carry out various activities, provide yoga courses and sell theme products.
The specific approach is to first set up a "show room" in an area and send a team to the local area to carry out activities such as yoga and aerobic exercise; Choose another group of experienced experiential users to drive more consumer participation. In China, Lululemon also replicated this model. Before opening its first community store in China in December 2016, it opened three "show rooms" in Shanghai and Beijing, respectively.
Strategy 4: Develop yoga into a collective activity that attracts everyone to participate. In Manhattan, Lululemon holds two regular open yoga classes per week, with over 400 women wearing branded clothing actively participating each time; At the same time, free yoga, Pilates, and SALSA dance practice classes will also be held year-round. In the Chinese market, Lululemon once launched its first national fitness event in front of the Imperial Palace in Beijing, which was held simultaneously in Shanghai and Chengdu, attracting a large number of yoga enthusiasts and selling out tickets overnight. This makes Lululemon's "fan base" very obvious: since 2011, Lululemon followers on Twitter have increased by 621%, while Facebook followers have increased by 200%.
Unlike the heavy money marketing strategy commonly used by international brands such as UA, WeChat, and Nike, Lululemon has established extremely high user loyalty at a low cost in a way that is close to grassroots, achieving a shift from niche to mainstream lifestyle brands. From 2010 to 2012, there were over 200 global stores with an average annual sales of nearly 1.4 billion US dollars.
Expanding product line to make male yoga crazy?
However, just as everything was going well, a public relations crisis plunged Lululemon into turmoil.
In March 2013, Lululemon's best-selling "leggings" recalled 17% of its products due to user complaints that they "looked empty" and paid a price of $670 million for it. And product issues quickly spread to other categories of sales, causing inventory to rise and revenue to plummet.
In May 2014, Wilson was forced to resign. Shortly thereafter, Laurent Pot Devin, former CEO of TOM Shoes, joined Lululemon and became the new CEO, determined to make new attempts to revive the brand.
In fact, the sports goods market has undergone new changes between 2014 and 2015: with the rise of the fitness trend, local brands such as Under Armour and New Balance in the United States have begun to explore the women's market. In addition, fashion brands such as Weimi have continuously increased their focus on the sports market, and Lululemon's advantage has gradually weakened, exposing a single weakness in its category.
However, no one can stop the Market trend. The new CEO can only start from his own "defense for attack" and start a new round of "expansion strategy" - to expand the target users to the male group while maintaining the relatively mature female market. Starting from 2015, Wilson recommended his son Duke to join the design team in order to stimulate inspiration in the men's product line. Duke was originally a sports expert, and Lululemon men's clothing designers believe that the "portrait" of male customers in the brand should be successful and sporty, and Duke is the best reference object.
Expanding the product line is only one aspect of Lululemon's "expansion strategy", and the other is to enter new overseas markets. In China, Lululemon began building community teams in Beijing and Shanghai as early as 2014, establishing brand awareness by setting up physical display rooms that do not sell products. As of the official opening of the store, this emotional cultivation with Chinese target consumers lasted for three years.
At the IFCLullemon community store in Lujiazui, Shanghai, male products not only occupy an important position in the store, but you will also see more male "educators". To attract male consumers and create differentiation, Lululemon has specially designed black shopping bags for male consumers, replacing the original red and white slogan shopping bags.
Bird is one of Lululemon's earliest "educators" in China, and he recently organized a men's yoga activity at the Lululemon community store in Shanghai. I have experienced all male yoga at the Lululemon North American event, where men and women are unable to relax in class, while men are very engaged together. "Bird said that in Lululemon," educators "like him are mostly good at several sports and not professional coaches, but they need to love the brand enough, and also be enthusiastic about socializing and sharing.
Pot Devin believes that China has become a key player in Lululemon's Asian market development, and the men's clothing product line is a business focus. Men's "educators" like Bird are more attractive to male consumers.
Pot Devin's men's clothing line sales have grown at an average annual growth rate of 20% over the past three years, reaching 330 million US dollars; In 2015, the revenue of the men's clothing line was $1 billion, accounting for 25% of the total business (revenue of $1.8 billion in 2015). Products that consider men's actual needs, such as ABC (anti ball crushing, meaning to prevent men's crotch from being squeezed) casual pants, have become star products that boost sales.
However, women with stronger willingness to consume are still a consumer group that Lululemon will not fall behind. Especially as Nike and Adidas increasingly value the women's market, Lululemon will not abandon this sales core position.
But Lululemon must realize that increasing the category of men's clothing is only the beginning of differentiation, as the new generation of consumers is constantly changing their love for trends and sports. So, how to break free from the fixed image of a "yoga brand" and expand into a broader sports field, continuously occupying new customer groups, is Lululemon's next challenge after completing the mainstream lifestyle leadership.

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