Marketing decoding | winter down jacket ones with fire, $270 billion of lululemon not selling yoga pants
At the opening ceremony of the 2022 Beijing Winter Olympics, lululemon was the biggest winner among fashion and sports brands.The 24th Olympic Winter Games officially opened at the Bird’s Nest national Stadium in Beijing on Feb 4.In addition to the breathtaking visual feast, the appearance of the delegations of various countries in the Winter Olympics will evolve the opening ceremony into the “World Down jacket Expo”, “World Down jacket Fashion Show”, “down jacket Grass Conference”.The Chinese team is made by anta, while The American team, South Korean team, German team, Italian team and Swedish team are made by Ralph Lauren, The North Face, adidas, Armani and Uniqlo.Are all well-known clothing brands to Chinese audiences.Without exception, they were upstaged by Canada’s Lululemon.That night, after the Maple leaf-red Canadian winter Olympics team took to the stage, the phrase “Team Canada uniform” quickly became a trending trending topic on Weibo, and Lululemon instantly became an Internet sensation.Lululemon has sold out of winter Olympics clothing as activists go into buy-buy-buy mode.Lululemon’s Canadian website crashed several times due to the influx.Some international students said they were woken up early in the morning by relatives and friends in China to buy goods on behalf of them.Lululemon may not be what you’d expect — Team Canada wears Canada geese — but as a Canadian sportswear brand founded in 1998, Lululemon’s market cap hit $40 billion in 2020, making it the most valuable sportswear brand in the world than Adidas at the time.Lululemon was valued at $60 billion at one point in November.Lululemon shares closed at $336.37 as of Feb. 4, giving the company a market cap of $43.491 billion.Down jackets are not Lululemon’s strong suit.It is best known for its yoga pants, dubbed the “Hermes” of yoga, which retail for 750 to 1,000 yuan per pair in China.Last September, Lululemon beat out Hudson’s Bay Company, the official apparel sponsor of the Canada Olympics for 16 years, to become the official apparel supplier for the Canadian Olympic team,For the 2022 Beijing Winter Olympics Canada team opening and closing ceremonies, award ceremony, daily wear and other equipment products.Despite making its Olympic debut in Beijing, Lululemon’s innovative design and fashion style have not only opened up brand awareness but also created recognition for its products beyond yoga wear.Lululemon has been a model for many of the country’s new consumer brands in recent years, and now it has a new example to learn from.What makes Lululemon stand out from the crowd?Lululemon’s down jackets have made a splash at the Start of the Winter Olympics partly because of their trendy design.In the past, down jackets were synonymous with being bulky and bulky, and it was often difficult to have fashion as well as temperature.Nowadays, with the pursuit of all the young people on the trend of warmth, down jackets also began to roll toward fashion.Each big down jacket brand has already embarked on the road of chasing fashion, in order to win the young group in the design, version.For example, Bosideng, a domestic down jacket brand, has returned to the mainstream in recent years thanks to the improvement of fashion of its products.Lululemon chose a more youthful maple red for its opening dress, rather than the Canadian flag red, which is stylish, elegant and not conservative.The down coat can be detachable, and athletes can switch between long, short and waistcoat freely through the zipper according to the changes of real-time body temperature. The removed part can be used as a scarf or hat.The inside of the clothes is equipped with straps, which is convenient for athletes to carry on the body when the temperature is high. There are two kinds of sports pants with and without printing under the clothes.For the first time in fabric technology, Lululemon uses 3D knitting to keep it warm.Lululemon Special Projects Creative Director Audrey Reilly said, “The Olympic Opening Ceremony is a long process, with athletes often wearing the same outfit for up to eight hours, but their body temperature changes with their location, movement, and even state of mind.Modular clothing designs allow athletes to customize their wearing experience based on their preferences, body type, thermal preferences, and more.”In addition, this modular form of clothing design, breaking the previous Olympic clothing too serious, unified tone, provides a variety of personalized, similar to the way young people fold fashion wear choices.There’s no harm in contrast, and when paired with the uniform uniforms of other countries, Lululemon, beautifully designed and functional, has fashion flowing from the screen, supported by the tall bodies of athletes in all shapes and sizes.Traditional sports events have been trying to solve the problem of younger Canadian teams for many years, so the Olympics also introduced new sports that are popular with young people, such as street dancing, skateboarding and surfing.Last year’s Tokyo 2020 Olympic Games, the Internet discussion reached an unprecedented height, shooting for The Chinese team won the first gold medal of the Olympics Yang Qian compared to the heart, as well as the popular yellow duck hair clip, all show that the young generation has become the main force for watching the games.It is also a reference point for the sports brands involved.In the past, sports marketing sponsorship was more about exposure and promotion of brand goodwill. Now, once the interactive connection with young people is established, marketing activities and consumption scenes can be directly transformed to achieve the dual function of integrating quality and effect.Lululemon appeals to a young, active demographic on social networks, who drive brand buzz.Some netizens revealed that this kind of down jacket has been launched in Canada for some time, but no one bought it in the store for less than half a year, and it was sold out after the opening ceremony.Let’s just say the Olympic effect lives up to its name.It’s not hard to understand why a world-class sporting event like the Olympics has become such a hot marketing spot for sports brands.Lululemon uses almost no advertising and spends just 2% of its revenue on marketing, according to public data.How does an unknown company make its mark on the sportswear Red Sea without advertising?Lululemon’s rise is inseparable from its market positioning. Inspired by yoga, lululemon has entered into the segment of yoga sportswear, targeting middle and upper class female users, and can reap high profits by selling yoga pants worth nearly 1,000 yuan per pair.Now its target consumer group has a more precise definition — Super Girls, 24-34 years old, unmarried or engaged, childless, possibly pet owners, highly educated, with an annual income of more than $8W, own their own apartment, and like sports and travel.Lululemon has made a lot of research and development in design, tailoring, design and technology, just like the down jacket that attracted the attention of the audience at the opening ceremony. Lululemon has solved users’ pain points such as transparent and ugly yoga pants, making them more comfortable, stylish, breathable, soft and skin-friendly, and finally achieved rapid breakthrough.It’s worth noting that Lululemon doesn’t limit its brand positioning to yoga, which is why so many women are using it as a stylish everyday wear.In addition To its precise market and user insights and innovative product design, the biggest contributor To Lululemon’s growth in recent years has been its Direct To Consumer (DTC) business.DTC refers to a sales channel or a marketing model that enables brands to directly reach consumers and enable them to complete purchases on official websites. Warby Parker, the American Internet eyewear giant, is the originator of DTC.Lululemon’s DTC mainly includes its own online channels such as its official website and official stores on e-commerce platforms.Lululemon reported 52 percent of DTC revenue in its 2020 full-year earnings report, up from 29 percent in 2019.Although Lululemon’s DTC does not include offline stores, it also belongs to D2C to some extent, considering that most of its stores are directly managed.As of October 31, 2021, Lululemon had 552 directly operated retail stores worldwide, an increase of 37 from a year earlier.It is reported that lululemon stores will not only sell products, but also organize many activities, inviting yoga teachers, fitness instructors and other Kols as brand ambassadors to develop courses and establish stable interaction with consumers.This immersive brand culture experience not only helps users make purchase decisions, but also builds brand loyalty.It is said that some foreign media described Lululemon as “like a moth to a flame”.Based on the success of the DTC model, Lululemon has a lot of followers: In 2017, Nike raised D2C to the group’s strategic goal;Anta started the transformation of DTC mode in 2020.Adidas placed D2C strategy at the forefront of its next five-year plan, announced in 2021.According to the plan, The DTC business of Adidas is expected to contribute about 50 percent of the group’s turnover and lead more than 80 percent of revenue growth by 2025.Lululemon has proven its brand power with a single line of yoga wear for women, but that has limited its ability to gain market share.Lululemon is also aware of this problem and has been expanding its product portfolio from yoga wear to its entire sportswear collection, from women’s apparel to men’s apparel, and from apparel to personal care products to create a more comprehensive product matrix.Lululemon also bought Mirror, a smart fitness Mirror company, for $500 million last year.Lululemon’s multi-category approach is already paying off.In the third quarter of 2021, men’s wear sales rose 44% from a year earlier, and women’s wear sales, the main revenue source, rose 25% from a year earlier, making it lululemon’s second growth curve for the second year in a row.But it’s not enough. Lululemon’s other categories remain unfamiliar to consumers because its women’s yoga line is so popular.So when team Canada was wearing Lululemon, not Canada Geese, some were surprised that lululemon sold down jackets, while others were wondering what Lululemon was.Lululemon, Team Canada’s Winter Olympics outfit, has a growing list of competitors.Brands like Nike, Adidas, Under Armor and Anta have all jumped into the yoga niche, which means Lululemon is at risk of eroding its core territory, as well as competing with them in other categories.Lululemon is increasing its investment in China, a competitive market for international sports brands and an important engine for lululemon’s international market growth.According to its third-quarter 2021 financial results, Lululemon’s sales in China, both online and in stores, have grown at a compound rate of 70% over the past two years, significantly outpacing the overall growth in international markets.”We are very happy with the 70 per cent compound growth in China.The company continues to invest in new stores in China and in its China headquarters in Shanghai.””Lululemon CEO Calvin McDonald said during a q3 2021 earnings call.As of October 31, 2021, Lululemon had 71 stores in China (including Hong Kong, Macao and Taiwan), an increase of 16 stores since the beginning of the year.Whether it’s to increase brand influence and reach a wider audience, to build user mindsets in other categories, or to accelerate the development of the Chinese market, everything will be easier to get on the Train of the Winter Olympics.As a powerhouse in snow and ice sports, the Canadian team will no doubt provide lululemon with more exposure and a huge advertising boost.The opening ceremony down jacket may just be a warm-up.