Now that Chip Wilson's influence has been minimized, curious to see what the new growth strategy will be for this great brand.
The New York area, a place with a relative high concentration of LULU stores compared to the rest of the country, only has two locations north of Manhattan for all of Westchester and Rockland Counties. Only four locations in all of Long Island. There are millions of shopping hours spent where potential buyers are not within a 30 minute drive of the LULU product line.
Open more stores? Yes. But look at what Ralph Lauren has done with a combination of a store within a store at Macy's and their own stand alone boutiques in high end shopping districts. They've been able to maintain the pricing margins on the clothing while still giving all of those shoppers easy access to the product. This is what Lulu needs to do. Build and maintain the feeling and integrity of the brand at stand alone boutiques where the shoppers get immersed in the brand culture but also giving them the ability to buy the product conveniently.
It's also what's best for shareholders. In the end, LULU has to win the fabric and design race to still be the premium brand in the space. That has to happen whether they have 200 or 2,000 outlets. To me, this notion of scarcity is BS. Scarcity just means you are not capitalizing on your opportunity while the brand is relevant. To stay relevant, scarcity won't factor in. The brand is already a mass market brand. $125 pants is accessible to nearly every woman. This isn't Rolex with a $4k entry, Jimmy Choo with an $800 entry or Range Rover with a $100k entry. It isn't a luxury brand in the pricing sense and the company should recognize that and try to be Ralph Lauren of workout gear.
agree that they need to increase distribution points, but disagree that macys or other department stores are a good fit. the focus should be on international markets. not sure which ones have the greatest potential for saturation, but i assume europe and china and japan would head the list.
I think most people feel the way you do. But if you are in say, White Plains, a central location in Westchester County, NY, you would have to drive 45 minutes to Greenwich, CT, or Rockland County or Manhattan to get to a LULU. This in an upscale county with two dozen shopping malls. There is huge growth potential in the US. You want shoppers to see your product when they're shopping, not make a special trip once a year to the store. I know my gal will see something, hold off buying it and then think about it for two days and go back and buy it. Millions of shoppers never see LULU on a day to ay basis. It's a problem. A good problem because it's fixable and now that Advent is on board, I suspect a problem that will be addressed.
Yes there is Europe and Asia. But distribution here is not close to adequate, yet.