Last updated on February 16th, 2024
In an era where fashion and comfort are becoming more intertwined, athleisure brands like Nike and Lululemon are poised for success.
Stroll down the fashionable streets of SoHo in New York or Oxford Street in London, and you'll spot numerous trendsetters confidently sporting styles that were once deemed unconventional just a few years ago.
Nowadays, it's not just acceptable but even encouraged to don grey sweatpants with a matching hoodie and dad sneakers. It's even better when paired with an oversized trench coat and a beanie. What might have seemed unkempt and unfashionable in 2017 is now regarded as the epitome of post-pandemic fashion—effortless, comfortable, and chic.
No brand has capitalized on this trend more than Lululemon. Its women's yoga pants have remained a favorite for over a decade, signaling to a diverse demographic—from college students to stay-at-home moms—that its wearers are active and financially capable of investing in both premium workout classes and accompanying boutique outfits. Lululemon embraces this reputation wholeheartedly.
"We do not drive our top line growth through discounts or promotions, and we have no intentions to do so." - Calvin McDonald (CEO)
Rather than pushing its merchandise at all costs, Lululemon has prioritized expansion into new markets. In 2022, it revealed plans to enhance its menswear line, tapping into a relatively untapped market for the female-centric brand.
Although it doesn't provide specific figures for shoe sales, Lululemon is clearly excelling in some areas. The company consistently impresses investors, with its stock rising by 48% during past year. Additionally, in January, it revised its net revenue expectations from $3.17 billion to $3.19 billion, marking a 15% increase compared to the previous year.
However, how do its customers feel about it? While the success of the shoe rollout may not be easily quantifiable, online forums are brimming with nothing but positive reviews.
This suggests that Lululemon is onto something. Furthermore, in February, Lululemon expressed its plans to further extend the line into the men's department, indicating confidence in its product's reception.
"At Lululemon, every product we make is designed to embody our feel-first philosophy, which is rooted in the belief that when you feel your best, you perform your best — and our new styles and men's footwear offerings are no exception. With new performance running shoes and our first-ever casual sneaker added to our lineup, we can now outfit both men and women in versatile gear from head to toe." - Lululemon Chief Product Officer Sun Choe
Yet, menswear still accounts for approximately 30% of Lululemon's revenue, which is not insignificant. However, CEO Calvin McDonald acknowledges that brand awareness among U.S. men stands at just 13%. Additionally, Lululemon faces stiff competition from other major players like Nike and Adidas in the men's market.
It's not that men are more selective; in many respects, they're simply oversaturated. With Nike producing footwear for numerous competitive sports and activities, not to mention their trendy streetwear offerings, breaking into this market seems like a formidable challenge.
Lululemon earned its reputation through word-of-mouth and partnerships with high-end workout brands such as SoulCycle and Peloton. While these brands have a devoted female following, they predominantly cater to women.
Given its lower revenue share, limited brand awareness, and the already crowded sneaker market, Lululemon might be better off focusing on its core strengths and gradually introducing a men's shoe line.