Business Strategy

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Q. What does a SWOT analysis reveal about the overall attractiveness of lululemon’s situation?

A. Strengths:

- Company’s product lineup of stylish, premium-priced yoga and fitness apparel that offers performance, fit, and comfort.

- The company’s wide distribution strategy which had its retail and company owned store in countries like Canada, North America, and Australia etc.

- The company’s marketing strategy of educating customers through local yoga and fitness instructors which increased the sales and improved the brand recognition

- Increase in direct customer sales through the company’s website.

Weakness:

- The company’s credibility has been proved low with the damage created by the quality of black Luon pants.

- Limited product line compared to Nike, Adidas and Under Armour.

- Problems faced due to the inconsistency of the company leaders creating a negative impact on the company’s business model.

Opportunities:

- Spreading its footprint to more countries.

- Providing fitness solutions for all segments of customers with all age groups.

- Offering discounts on left over inventory though outlets and company websites

- Increase models sold at the company website to gain growth through sales.

Threats:

- Complexities caused through increasing growth rates of new entrants like GAP, Lucy and Bebe stores.

- Confining to only a small segment of customers

- Competitive pressure from other industry giants like Nike, Adidas and Under Armour who has more capability in grabbing the attention of customers by providing equal quality design for a low price. This occurs mainly due to ample resource capability of the rivals in the same industry.

The overall situation for the Lulu lemon the company seems to be un-attractive and it very hard for the company to maintain a sustainable strategy. Some of the company’s advantages were its marketing strategy in choosing its customer segments and meeting its mission though its product line. The problems faced due to the inconsistency of the management which is had a lot of changes in its strategy throughout its journey and the damage created by one of the company’s product has brought some major issue for the company’s credibility. Moreover, the competitive pressure created through both new entrants and by the existing rivals has been gradually increasing creating a narrow scope for the company to survive. So, by considering all these factors influencing the company’s growth it is hard for Lululemon to sustain over the future.

Reference

Thompson, A. A., Peteraf, M. A., Gamble, J. E., & Strickland, A. J. (20th ed.) (2016). Crafting and executing strategy: The quest for competitive advantage. New York, NY: McGraw Hill Education