BIGGER THAN `JUST YOGA'
Lululemon goes international
Lululemon Athletica, whose upmarket leggings and sweatpants have taken affluent North Americans by storm, is eyeing plans to more than triple the proportion of revenues from overseas in an intensified global branding push in countries from the U.K. to Japan. In contrast to other clothing companies hit hard by the coronavirus crisis, Lululemon's market capitalization has swelled to more than US$47 billion this year on the back of higher demand from housebound consumers for athleisurewear — items worn casually as well as for exercise.
As some on Wall Street question whether the yogawear brand — sported by celebrities including Meghan Markle — has peaked in the U.S. and Canada, Lululemon is expanding overseas and also into new products.
The Vancouver-based company generated only 14 per cent of its US$1.1 billion net revenues from other countries in the three months to November 1. “There's no reason why that can't be 50/50 in the years to come,” Calvin McDonald, chief executive, told the Financial Times.
If the ambition was realized, it would expand Lululemon's international presence significantly beyond its publicly disclosed target, which is to generate US$1.44 billion in annual sales from overseas by 2023.
Lululemon, which spent US$500 million in the summer acquiring Mirror, an exercise equipment startup, is also seeking to increase its popularity among men.
“A large percentage of them are not aware of Lululemon, or if they are they think of it as a female yoga brand,” McDonald said, adding that Lululemon was “broader than just yoga”.
“We've evolved away from that for many years.”
The company, known for its leggings that sell for about US$120 each, aims to double its menswear revenues to US$1.4 billion between 2018 and 2023.
Menswear had outperformed for Lululemon overseas, where the brand did not have the same gender associations, McDonald said.
Ecommerce sales accounted for about 43 per cent of the group total in the three months ended November 1.