Does Lululemon need a teen strategy?
Lululemon continues to gain popularity with teens, despite not directly targeting the demographic.
According to Piper Sandler’s “Fall 2022 Generation Z Survey,” the yoga-themed chain reached the number two favorite apparel brand spot behind Nike, moving ahead of American Eagle Outfitters, Pacific Sunwear and Adidas since Piper’s fall 2021 survey.
Among upper-income female teens, Lululemon surpassed Nike as the favorite athletic apparel brand. Among males across income ranges, Lululemon improved to number six from number nine in Piper’s spring 2022 survey.
Lululemon has benefited as leggings have replaced jeans as teen girls’ favorite bottoms. The athleisure trend has also boosted the teen cred of Nike and Adidas, although both aggressively court youth, including through collaborations with musical artists.
At its Analyst Day held in August, Lululemon officials spoke of focusing their marketing goal on raising brand awareness without unveiling any strategies to reach specific age demographics.
In the U.S., unaided brand awareness is 25 percent, including 38 percent among women and 11 percent with men. Said CEO Calvin McDonald, “We are still a hidden little secret.”
To raise awareness, Lululemon will borrow from the playbook of major athletic brands by making “smart investments” across earned and paid channels as well as in sports marketing, such as through athlete endorsements. Nikki Neuburger, chief brand officer, said at the event, “We plan to leverage a tight roster of incredible people with a large reach frequently.”
Entering categories such as footwear and supporting more activities (e.g., running, golf, hiking) to make Lululemon “a bigger part of our consumers’ wardrobes” is another expected awareness driver, according to Ms. Neuburger. Lululemon’s “authentic” positioning around personal wellbeing, she added, has become more relevant post-pandemic.
Getting the word out, however, remains largely a grassroots approach, including signing up fitness trainers and yoga instructors as local ambassadors and supporting community events. Partnering with local studios is a core driver of its new paid-membership program. Said Ms. Neuburger, “Strong relationships have been a critical ingredient of our secret sauce since the early days of the brand. It started in our stores and now membership will allow us to do the same digitally and at scale.”
- Piper Sandler Completes 44th Semi-Annual Generation Z Survey of 14,500 U.S. Teens – Piper Sandler
- Lululemon 2022 Analyst Day Webcast (webcast) – Lululemon Athletica
- Lululemon Analyst Day 2022 (PowerPoint) – Lululemon Athletica
DISCUSSION QUESTIONS: Should Lululemon adjust its marketing strategy to capitalize on its newfound popularity with teens? Does a largely grassroots-driven customer acquisition approach still make sense for Lululemon?