Breakout

Lululemon: A Recall Scheme You Can See Right Through?

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It would either have to be a miracle or a self-imposed media blackout to have not heard about Lululemon's (LULU) see-through yoga pants debacle by now. Check out this chart on Google Trends for the phrase "Lululemon pants" that went from 15 to 100 (the maximum) in the blink of an eye. You just can't buy publicity like this!

As my co-host Jeff Macke and I discuss in the attached video, not only has the company reclaimed its role as premium purveyor of high fashion and high priced workout gear, it has also devised a scheme that brings existing customers back into its stores for a free refund. We may never know the exact answer, but I'd bet at least half of the exposed yogis who actually decide to return their unacceptably sheer pants will end up buying something else while they're in the store.

So, while the company has now put a tangible dollar estimate on what it thinks the see-through pants problem (promotion?) will actually cost it this quarter and this year, the truth is, it's really hard to say. What is perfectly transparent, however, is the fact that this Vancouver-based retailer is still in hyper-growth mode, with less than 200 total stores in the U.S., Canada and Australia, as well as a thriving online business.

Will they forever more be known as the see-through pants company? Maybe. But at the same time they'll simply be known by millions of more people who might never have gotten beyond the funny name.

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