Lululemon plans to double sales from mens' products, sets sights on footwear market
Traditionally women-focussed athleisure retailer announced ambitious plans Wednesday
The traditionally women's athleisure retailer Lululemon Athletica Inc. announced ambitious plans to double revenues from men's products and digital sales, and quadruple international earnings by 2023.
"We really are in the early innings of our full potential," said CEO Calvin McDonald at the company's first analyst day in five years held in New York City on Wednesday.
Lululemon anticipates its annual revenues will grow more than 10 per cent for the next five years with product innovation, omni-channel guest experiences and continued market expansion being primary drivers.
The company sees great potential for growth in men's clothing.
"We have very low brand awareness with men," said McDonald, explaining there is a huge opportunity to increase that, showing men how Lululemon's clothes can be a good choice for their athletic and other pursuits.
The brand will soon launch a new running apparel line dubbed Fast and Free aimed to help men achieve both those feelings with clothing that contains thermal-regulation properties as well, said Sun Choe, the company's chief product officer.
Growing the men's offering will be part of Lululemon's ongoing product innovation.
Moving beyond yoga
Lululemon wants to help outfit people for activities other than yoga, she said, and will focus on growing its offerings for runners, as well as people who do strength training. That means adding more high-support bras in addition to its popular lighter-support ones with strappy backs, for example, and creating more durable, flexible fabrics for the demands of a cross-fit workout.
The company will expand its accessories line as well, which it still sees as a start-up business, said Choe. It will focus on purses, as well as equipment such as fitness rollers and training gloves. Lululemon sees accessories as a way to bring younger people into the brand thanks to lower price points and boost sales that spike around holidays as people purchase gifts.
Lululemon will also roll out its self-care line to 50 stores this June, said Choe. It initially tested the products, which include a deodorant, dry shampoo and lip balm, at more than a dozen stores in Chicago, Orange County. Calif., and Toronto.
McDonald said the company also has plans to create some new products in the footwear space, but said more details would come at a later date.
The company says its loyalty membership program, which is currently being piloted with plans to roll it out nationally, will help double the company's digital revenue.
For an annual fee, the program provides members with access to exclusive products, a personal development curriculum, a dozen fitness classes each month run by Lululemon ambassadors at local studios and other perks. It is currently being tested in Edmonton and Denver, with plans to launch in Austin, Texas, in May and one more North American market later this year, said Celeste Burgoyne, executive vice-president of Americas retail.
While the company thought die-hard Lululemon fans would make up the bulk of membership, she said the program's proven to be a way for the company to acquire new customers. In Edmonton, 10 per cent of memberships are a customer's first purchase from Lululemon, while in Denver that figure is 13 per cent.
Lululemon's plan to quadruple its international revenue within five years comes with a focus on China.
It projects its revenues in the country will exceed those from Europe, Australia and New Zealand combined by 2023, said Stuart Haselden, chief operating officer. That potential comes from the country's level of urbanization, as well as its number of online users and millennials.
Lululemon still sees considerable growth potential in Canada and the U.S., but expanding across China and other international regions will continue to be an area of focus.