While it’s been a rocky few months for Lululemon Athletica, the retailer is hoping it can work its cult-like magic and unique shopping experience on some notoriously reticent shoppers: men.
The yoga-wear retailer has been grappling with the fallout of a see-through yoga pants fiasco and sudden resignation of the CEO but its new growth strategy to launch standalone men’s stores by 2016 is winning kudos from retail experts.
Men’s apparel currently counts for 12 per cent of Lululemon’s business, according to RBC Capital Markets softlines analyst Howard Tubin. The company has already produced highly popular products for male customers, including regularly stocked items such as underwear, as well as capsule collection pieces for men, such as board shorts. Women may be the driving force behind Lululemon’s success, but the contributions of male customers are still “meaningful,” and likely a focus area for company growth.
Most important in drawing in customers to standalone men’s stores however, will be in replicating the unique shopping experience the company is known for. Lululemon has never been just about selling a product, but in selling an ideal and buying into a lifestyle.
Men’s products need to be “unique and differentiated,” Tubin said, and the running shorts have to be like “like no other running shorts out there,” to ensure the Lululemon experience translates just as well to its new standalone men’s stores as it has to its regular retail locations.
CEO Christine Day made the announcement regarding standalone men’s apparel stores in a presentation at the William Blair & Co. conference in Chicago, several days after she announced she was leaving Lululemon when a successor was found. While the retailer enjoys an almost cult following from its women clientele, it has gone from being a market darling with investors to a pariah after analysts reacted negatively at the gap in the company’s leadership following the release of its recent quarterly report on Monday.
There are no details yet on how many men’s stores the retailer plans to open or where the stores would be.
“There’s always the question with a company like Lululemon: When does all of the growth stop?” said Maureen Atkinson, a senior partner with retail advisors J.C. Williams Group.
“There are natural places to look for new customers, and certainly the husbands of your current customers are probably a good place to start.”
Atkinson also noted that a multi-sports branding approach beyond yoga might be attractive to male customers. While yoga was a passion of Lululemon founder Chip Wilson, the company’s website also emphasizes the use of its men’s apparel for running, biking, and playing golf.
“I think men’s (apparel) will be a home run,” said Jennifer Black, a retail analyst and president of Jennifer Black & Associates.
“It’s going to get a lot of buzz… There’s going to be a curiosity for men that have never been in,” she added, pointing out that the move will likely generate a lot of media attention that will draw new and existing customers into the standalone stores.
While analysts were positive over the announcement, investors have not returned to the stock. Shares of Lululemon are down about 20 per cent since Monday’s announcement that Day would be leaving. Four senior positions in total need to be filled in the company’s boardroom.