SWOT Analysis of Lululemon
If you are an aficionado of loungewear such as leggings, trousers, tees, or shorts, then you might have heard of Lululemon. It is a popular apparel brand in the world with quality apparel and accessories. How do they achieve immense success? We are here to find out the answer to this question by conducting a SWOT analysis of Lululemon. It is headquartered in Vancouver, Canada but was founded in Delaware, USA. Both American and Canadian people are involved in its management. Chip Wilson founded this company in 1998 and opened its first store in 2000.
At the start, the company only sold yoga pants. But now, they sell everything including undergarments, jackets, pants, sweaters, tops, athletic wear, accessories, lifestyle apparel, etc. They also have a wide variety of personal care products. They are actively present in Asia, North America, Oceania, and Europe.
Currently, the company has more than 490 stores across the globe. They have a strong online presence where customers can buy their products. As compared to other retailers, Lululemon is not that old in the market. But, it has managed to secure its position in the market. By conducting its SWOT analysis, you can easily analyze Lululemon’s strengths, weaknesses, opportunities, and threats. Here’s the complete SWOT analysis of Lululemon,
SWOT Analysis of Lululemon
Company Name: Lululemon Athletica
Founders: Chip Wilson
Founded: 1998, Vancouver, Canada
Headquarters: Vancouver, Canada
CEO: Calvin McDonald (Aug 20, 2018-)
Type: Athletic clothing retail
Sector: Lifestyle and Retail
Tagline: Jealousy works the opposite way you want it to
Unique Selling Proposition: Yoga clothes for people who want to live a healthy and long life.
Customers: Sports enthusiasts, health-conscious men, and women.
Target Consumers: Urban upper middle-class individuals.
Revenue: Annual revenue for 2021 was $4.402B, a 10.62% increase from 2020.
Net Income: Annual net income for 2021 was $0.589B, a 8.78% decline from 2020.
SWOT Analysis of Lululemon
Strengths of Lululemon:
These factors give a competitive edge to an organization. Strengths are the real support for any business and provide a competitive advantage. As a result, an organization can handle difficult situations with ease. Here are some strengths of Lululemon,
- Raw Material:
Running an apparel business is not a difficult feat when you have raw material in excess. Lululemon has excess raw material and its products are available everywhere. Moreover, the quality of raw materials is high which makes the brand highly notable. They introduced a fabric named Luon in 2015 which has more nylon microfiber. They have different varieties of raw materials and they produce unique and trendy clothes.
- Product Portfolio:
As we have already discussed in the introduction that Lululemon has a wide range of product portfolios. This kind of extensive product line gives the company a competitive edge. As a result, they target a range of different customers.
- Marketing and Promotion:
The company has a strong website and presence on several social media platforms. They spend millions of dollars every year on marketing and promotion. So, they have a strong brand image all around the world. Currently, they have approx. 3.8 million followers on Instagram. So, they easily promote their brand and products on these platforms to customers. They are utilizing other digital marketing tactics to get more popularity. They use different strategies and tactics to promote their products.
- Research and Development:
The company has a strong R&D department which enables them to manufacture trendy products for trendy users. They have built “white space” which is actually their research center. This effort provides Lululemon a constant growth and innovation. That’s why it is a market leader when it comes to loungewear or workout clothes.
- Global Reach:
Even though Lululemon is not present in every corner of the world but its products are available in every country through different retailers and websites. Moreover, the company has a lot of outlets in different countries which gives it an international position. Due to its outlets in different locations, Lululemon is considered as one of the most sustained retailers.
SWOT Analysis of Lululemon
Weaknesses of Lululemon:
Every company has its own weaknesses and weak points. Lululemon is lacking in some areas. The company can convert its weak points into strengths. How? Read the following points,
- Brand Recall:
The company has a strong online and physical presence in different countries but its brand recall value is relatively low as compared to its rivals. When it comes to sportswear or athleisure wear, the first names that come to your mind are Nike, Puma, and Adidas. It is a major weakness of the brand.
- Costly Products:
Lululemon is considered the most expensive brand due to its prices, while most of its competitors are selling the same products at attractive prices. Although, their quality is also top-notch; however, some customers are price-conscious. They should manufacture less costly apparel in order to attract more users.
- Network Gaps:
The company is competing in the global market but it has gaps in the network. There are some areas where it doesn’t even exist. Even in the 2022 and the advanced era, some people don’t know about Lululemon. They should work on it to fill such gaps.
- Political Influence:
Involving in social and political campaigns can destroy the whole image of the brand. Moreover, the brand has been involved in many political factors that can disturb its brand image and perception in the eyes of customers. The owner of the company has also been involved in several controversies. This thing can destroy the image of the brand globally.
SWOT Analysis of Lululemon
Opportunities for Lululemon:
An industry provides much growth opportunities to a company. Lululemon can use these opportunities in the right way to enhance its sales and productivity.
- Expansion in Network:
Honestly speaking, Lululemon is not a global apparel brand. It doesn’t have a global reach. They have to work really hard in order to attain global status. The brand has so many growth chances in several countries such as China, India, and more. These countries can provide the right expansion and reach. Moreover, they can also increase their customer pool by targeting other markets.
- Increase Product Line:
Yes, they have a wide variety of products but they can increase their product line. They can offer inexpensive products to attract every type of customer. An affordable product lines can help the company to increase its sales and customer base. Affordable products will help the company to attain a global presence.
- Online Platforms:
In this era of social media and the digital world, the brand can utilize digital retail space to enhance its profit and revenue game. However, Lululemon can compete with other big players effectively. Moreover, online shopping is a big thing since the global pandemic has hit.
SWOT Analysis of Lululemon
Threats to Lululemon:
Brands like Lululemon are highly prone to threats. It is important for the brand to identify the threats and fix them as soon as possible. Threats can give a serious dent in the company.
- Intense Competition:
Every company or brand in the world faces competition. Lululemon is surrounded by many big players such as Puma, Amazon, Nike, Adidas, Under Armour, and Gap. They are threatening each other’s market share and profitability by offering better products. In short, the competition in the retail sector is very tough and there are many companies making authentic sportswear and accessories. On the other hand, Lululemon’s competitors are operating globally while the brand has a limited global presence.
- International Expansion Requires Several Resources:
It is really overwhelming to penetrate into new markets because it requires plenty of resources and hard work. Right now, the brand does not have enough resources. It is facing several challenges in the form of pandemics and global recession.
To Conclude:
Generally speaking, the brand is doing well in the market. It has plenty of good strengths and opportunities that it can utilize to expand its business. Moreover, the company should not ignore its weaknesses and threats. They are not as popular as their competitors but make a decent profit from limited markets.
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