Product innovation, omni-guest experience, and market expansion could be the growth pillars for almost any company in the world. Much like the “Conjoined Triangles of Success” by the fictional Jack Barker, the Power of Three appears at first glance to be mind numbing, corporate jargon at its most boring. One cannot find a statement by a lululemon exec since 2019 that fails to mention the Power of Three. The Company’s recent success in its international markets demonstrates that the “sweatlife” translates across cultures and geographies and presents considerable growth potential for the brand. Market expansion: The Company plans to quadruple its international revenues by 2023. Omni guest experiences : The Company expects to more than double its digital revenues by 2023. In addition, its plans call for continued expansion in the women’s and accessories businesses, in particular by offering more sizes for women of all shapes. Product Innovation : Double the size of its men’s revenues by 2023. Management will say it’s about the “Power of Three,” its 5 year plan that was “unveiled” in 2019: The chart below shows us the rise and fall and rise again of lululemon over the past ~10 years. In 2018 lululemon’s revenue growth rate exceeded 20% for the first time since 2012, and its market cap as a percentage of Nike’s market cap (a metric we invented) went from 8% in the middle of 2017 to 26% today. It’s not often talked about as a turnaround story, but that’s exactly what it is. Since 2018, the company has been on a tear. If someone had told me then that my dad would be wearing lululemon every day, I’d have imagined a late-middle-life crisis involving yoga retreats in Bali. In fact, around 2014-15, the company was starting to stall out, its stock price was on life support, and its CEO was being ousted for fat-shaming women who didn’t quite fit into lulu’s overly tight customer segmentation. And now the company is acquiring futuristic home workout tech companies.īut it was not at all obvious that this is where the brand was heading, even as recently as late 2018. Outerwear, work-pants, and of course, workout clothes of all types, for both men and women. Lululemon (yes, with a lowercase ‘l’) has become the go-to brand for much more than just yoga pants. When lululemon acquired Mirror this past summer, the joke was that now lululemon customers finally have an overpriced mirror to go with their overpriced leggings.
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