Analysts say they are particularly impressed that Lululemon eschews the traditional marketing strategy of hiring high-priced sports celebrities to model its outfits. Lululemon spends almost nothing on advertising beyond occasional print ads in yoga and running magazines.
Instead, it recruits the type of athlete who tends to influence active women: fitness instructors who lead yoga, spinning, Pilates and running classes. The cost of this stealth strategy—Lululemon declines to call it marketing campaign—is minimal.
Lululemon provides apparel stipends of varying amounts to local fitness stars who model the apparel not only in their regular classes but also in sessions held inside Lululemon stores. [via wsj.com]
It seems to be working and lululemon is cashing in on the $15 billion market for women’s fitness clothing. The article gave us some stats, which I don’t understand, as proof: “Lululemon posted second-quarter earnings of 30 cents per share, far above the 24-cents-a-share mean estimate of analysts and more than double the 13 cents a share posted in last year’s quarter. The earnings gain came on a 56% rise in revenue, and a 31% boost in sales at stores open more than a year.”
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News to me: lululemon only runs “occasional” print ads in a handful of yoga and running magazines. Basically, they have eschewed traditional advertising strategies in favour of getting into the local community and marketing through word of mouth and local influencers.
What I find interesting about this is that while lululemon is basically operating on a grassroots model, the rest of the yoga industry is operating on the big sports brands model (think: Seane Corn for Lucy, everything that YAMA promises, the list goes on…). I don’t know how much a high-priced yoga celebrity would cost, but I assume it’s much more than the $1000 stipend that lululemon gives its community ambassadors.
Photo: A yoga class in a Washington DC lulu store (via washingtontimes.com)