Lululemon Athletica Store Front
Lululemon is a 20-year old successful yoga wear company founded with the goal of providing technically athletically hip clothing to yogis and aspiring yogis around the globe.
By the very nature of Lululemon's founding vision, the company actively designs with innovation, specifically the use of technically-smart, innovative fabrics, in mind. Innovation is a great way to create a sustainable competitive advantage as oftentimes smaller, start-up companies are slow or financially unable to invest the time and money required in the R&D process.
An organization taking advantage of R&D as a competitive advantage also establishes a niche market of expert wearers, such as yoga instructors, whose opinion on appropriate yoga wear is highly valued by their eager students which for the case of Lululemon has turned into the sound of ka-ching. At least ka-ching has been a popular sound ringing out in Lululemon Athletica stores until fairly recent.
Everyone knows that yoga is not a sport, but rather is considered a physical, spiritual, and/or mental practice. As a practicing yogi, I typically describe my practice as a moving meditation and so....the last thing one associates yoga with is sexiness. Yoga and yogis, like myself, take ourselves way too seriously to ever want our twists and bends to be viewed as sensual or erotic...and so we find ourselves asking how did these super sheer, super sexy, butt-revealing yoga pants ever find their way to market? How did things go so wrong, so fast for Lululemon Athletica?
Sheer Black Yoga Pants
In tracing what went wrong with Lululemon's signature Luon yoga pants, we've found ourselves pointing the finger at recently displaced Chief Product Officer, Sheree Waterson. Waterson has been with Lululemon since 2008 and I will wager has probably seen a lot of technical black yoga pants pass her way during her tenure.
Well after a while, folks, one black pant starts looking a lot like another black pant and so on. But is the quality gaffe seen with these black, sheer yoga pants really Waterson's fault alone or rather indicative of a company who during the last few years has turned its back on its own quality stand?
I would imagine the truth lies somewhere in the middle between a chief product executive pressured to meet the growing demands of a rapidly expanding business and a chief executive office pushing for ways to deliver product that satisfy both the consumer and the profit-driven stockholder.
Black Sheer Yoga Pants
Indulge my rampant imagination for a moment and allow me to demonstrate the day(s) in the life of a product debacle:
Day 1: Today started same as any other day, the product managers have reviewed and approved the fabric swatch sent from the Taiwanese supplier and so it looks like I'm a go...I will soon be sewn into one of the millions of athletic black pants sold to millions of happy, wealthy, and zen-driven Lululemon yoga customers. I'm so very excited.
Day 15: While waiting for the fabric to arrive, the factory, luckily, had some sample yardage of the approved luon fabric and so now, my fit prototype is in Vancouver being worn by one of the company's fit models and specs are being double-checked for final production. I'm pretty sure the company's fit room is well-lit and the fit model is not only just expected to wear the prototype, but to also stretch and bend in the fit sample using some of the same moves as most yogis who will be wearing me. Or at least I hope so:)...can't wait to be made into bulk production and become one of the many pants worn by millions and millions of Lululemon's dedicated customers.
Day 17: We've all just heard the fit has been approved...great news for those of us waiting to be turned into Lululemon's popular luon pants...I think I overhead the factory manager saying that markers have been set and bulk fabric is due to arrive in just a few days. I'm not sure, but I think, I may have also heard the manager say something about finding a cheaper fabric alternative...very similar to the approved luon, but much cheaper. I hope the factory has passed this tidbit of information on to Lululemon as it would be a shame for the factory to jeopardize both their reputation and Lululemon's. I think based on Lululemon's checks and balances, the factory will have to pass the fabric alternative on to Lululemon for their final approval. Ok, fingers crossed that this all goes ok...so ready to be a fancy-dancy techno yoga pant:)!
Day 21: Looks like we are back in business and on schedule for bulk production! The factory manager received approval from Lululemon's product development team to proceed to bulk with the luon fabric substitution. The cost savings was too attractive to pass up and the factory will forward the substitute fabric tests to Lululemon for record once the bulk fabric arrives. 'Sides this is a fairly basic item for Lululemon and so should not be a problem...at least that's what "I" think I heard one of the factory managers quote back the words from the Lululemon's product development team. So all systems are a-go and tomorrow with a new and "hopefully" improved fabric, but definitely "approved" fabric, I will begin my life as a Lululemon techno-savvy, black yoga pant. I am counting the days till I and the rest of the pants are finished and shipped to Lululemon stores across the globe. I will be so happy to have a pant owner and a yogi home to call my very own.
Day 60: Hey! So sorry it's taken me so long to write in you, diary. I've been so busy with the cutting, sewing, tagging, boxing, shipping, unpacking, distributing, I am finally located, for the moment, in a Lululemon Athletica retail store in Santa Monica. It is so beautiful here! The weather is nice and the people who come into the store seem to both have lots of money to shop with and are very interested in yoga as a healthy lifestyle choice. Everyone in Santa Monica looks fit and healthy. I just know I'm in the right place for now and it will only be a couple of days before my owner-to-be finds me and take me to my new permanent home. I've been in the store for about a week and am a little nervous as have heard a few potential yoga pant owners discussing their concerns about how see-through our pant fabric is. I just think to myself no way this is possible especially after all of the testing done for the new fabric. But...you know come to think of it...don't think anyone really tested the look, fit, and performance of the fabric once stretched. This makes me a little nervous, but Lululemon has been making black yoga pants for years and I can't imagine any issue with me and my like-designed friends.
Day 70: It's all hit the fan, dear diary:(! Me and the other black yoga pants that were produced and shipped same time as I are in recall. Recall! I mean why? It's just not fair! I hear that many customers across the country have been complaining about how "sheer" we are and that they don't want to wear yoga pants that will expose them while bending and stretching into poses like downward facing dog or the plow pose. I mean the "sheer" horror of it (no pun intended;0)! How can this be? But, you know I really think this is largely due to switching the fabric at the last minute and "not" taking the time to fully test the fabric for quality and fit. Everyone, including me, was in such a rush to produce, ship, and sell we forgot how important to insure the integrity of our product, to not only keep our promise to our customers, but also the promise we made to our business which states, "Quality is at the heart of what we do...." What were we thinking?! Now I'll never be bought and worn...who's going to wear sheer black yoga pants? Well, I can think of a few types of customers, but not dedicated, loyal Lululemon yogis. I feel this is my demise and very likely my last diary entry. I hope you take good care, diary, and that someone will read my journal and learn the lesson I and Lululemon learned a little too late.
This product management gaffe has been especially daunting for the company as this particular pant on recall represents 17% of women pants sold in Lululemon Athletica stores and has since prompted a shortage in pants which of course, in terms of merchandising, means same-store sales are effected. In fact, same store sales estimated for the first quarter, available in June, have been downgraded from 11% to between 5-8%. In addition to the estimated 67 million in retail sales this big quality misstep has created for the company, stocks value has also recently declined.
There are a lot of opportunities for Lululemon to learn from their mistakes and move forward. I've read, in addition, to the big shake up in the product development department, the company has also begun to review their quality control initiatives looking to take a more aggressive and proactive to insuring that the product shipped matches the company mantra. This is great news and shows the company's commitment to learning and improving from their mistakes.
Many industry professionals are citing the fault lies in too slow of a response from the company, but I ask just how quickly can any organization react once the goods are on the sales floor and selling? At this point, you can really only hold your breath, click your heels, and hope that sheer black yoga pants become the next new yogi craze. In this case, Lululemon was "not" so lucky. The answer isn't quick fixes to an existing problem which I personally think Lululemon has handled quite well by making the decision to recall the product. No, the answer does not lie in creating quicker responding reactionary measures, but rather in implementing checks and balances which safeguard the integrity of the product. Hence, I reference back to my slide presentation on The Importance of Quality Assurance.
This is done by product development remaining, at every step, engaged and involved in the approval of each component of the garment produced. This is going to mean the company spending money on external testing resources and not relying solely on the tests submitted by manufacturers, as well as spending money on expert QC professionals who can travel to the factories to insure the materials and/or garment approved will indeed be the garments produced and shipped. Finally, staying true to the values important to your customers and instead of chasing profits cementing loyal, sustainable relationships with customers who want to "and" are able to spend money on quality products that not only perform technically well, but also represent what's most important to the Lululemon consumer. Lululemon would do well to take careful note of their own manifesto, one of which states, "The most should never give way to that which matters the least." I couldn't agree more. Would love to hear your thoughts!
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4/11/2013 05:22:23 pm
What a fantastic and very realistic story. I fully agree with the point of view. Price should not always have first priority. The key words are definately "staying true to the values".
4/12/2013 03:44:33 am
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