Lululemon Case Study free essay sample

Founded in 1998, lululemon has become an extremely successful company. Over the last 12 years of operation, its mission is to improve health, make a difference in all the communities it is located in, and provide guests with quality products to help them live healthy lives. Currently, lululemon still strives to make a difference in each community through the Community Legacies Program. Plans for expansion are also in effect, and its economic responsibilities are continually being met by the income generated each year. Social Responsibility is the backbone of lululemon. It presents many positive aspects for the company such as maintaining a positive image within society, however it may result in potential negative outcomes like possible profit loss. Strategically, lululemon uses non-traditional and unique marketing and business schemes. For example, lululemon relies on social activities for product promotion rather than typical ad campaigns such as print and/or television media. The next step for lululemon is to encourage people to bring families to the in-store yoga classes to better find a balance between work, family, and healthy living, together. We will write a custom essay sample on Lululemon Case Study or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Issue/Problem Statement lululemon athleticas main goal is to provide their guests with products that will help them live long and healthy lives. They ensure quality in their products, as well as recognize customer needs and adapt to meet those needs. Their goal is to demonstrate integrity and ethics in their company as well as create a positive relationship between their stores and the communities they are located in. lululemon constantly challenges itself to maintain these social bonds, ethical and social responsibility practices, while achieving their economic and financial quotas. Background Information  lululemon is a Vancouver based company with over 100 locations worldwide and is valued over $200 million dollars. The company was founded in 1998 by Chip Wilson, who started the company with the idea that his products would help improve the level of health within a community. Responding to the increased number of women participating in Yoga, lululemon has created products with new innovative fabrics and technology to fit, and feel better which helps women improve their fitness goals. They have provided a culture that provides awareness of the health benefits of doing yoga in daily life. lululemon’s mission statement is to help people live long, healthy, and fun filled lives. They focus on ensuring that their products are of the highest quality and that their store experiences are one of a kind. lululemon invests money in training to educate their staff on effective and creative ways to create a unique experience in each individual store. With deep rooted ties in each community, lululemon created the charitable giving program, where guests of each location decide which local charities they would like to support. Klululemon then chooses up to eight of these charities to be part of the program. Current Information lululemon has established their popular Community Legacies program which is a â€Å"5-year vision that is based on the belief that every person we hire, garment we create, store we open, customer we educate and yoga class we attend contributes to building a legacy in our communities. In 2009, lululemon’s net income generated about 58. 3 million dollars. Their earnings have topped the Streets consensus for seven consecutive quarters. It is also bringing U.S stores to the same level as Canadian stores. The 44 stores in Canada (35% of the total) generated 60% of revenues last year. For the year of 2010, lululemon has plans on opening 12 to 15 new stores this year; it aims to open 25 showrooms by June of the following year and 20 by August. â€Å"CFO John Currie projects a possible 300 stores in North America, with Asian expansion likely into 2012. † Data Analysis lululem on athletica has become a strong and successful company which can be measured economically, as well as by social responsibility. By being socially responsible and utilizing their strong code of ethics, lululemon has created a prestigious reputation for itself by effectively serving the interests of the customer by creating new, quality goods that helps benefit the customers’. lululemon has also fulfilled customer interests by letting them choose which charities in the community they want to support. lululemon also acts in a socially responsible manner by having in store yoga classes for customers to fulfill their mission of helping people live healthier, longer lives. Although lululemon athletica is a very strong company, it has some weaknessness. By acting in a socially responsible manor, this may cause a halt in the company’s economic increase. Profit loss may be a main consequence of investing so much money for training, hiring yoga instructors, and supporting charities. In a short-term perspective, resources such as intellectual capital, money, and time are used on educating the public about the yogi lifestyle. In the long-term, the company is able to effectively use social responsibility as a competitive advantage, as resource utilization and â€Å"waste† is a necessity to running a successful business. This is redeemed by the company’s high prices on their product, which then is redeemed by the positive and unique in-store experiences. This allows lululemon to have a strong economic and prestigious reputation, making it a successful company with a high competitive advantage compared to its opponents. Current Business Strategy and Results lululemon executes an innovative non-traditional business strategy which can be seen in the marketing strategies used. Since lululemon does not use traditional advertising techniques, it relies on running clubs and other social activities for their products to gain attention. The stores also provide free products to yoga teachers, fitness instructors and others to spread the word to people who have the same personal interests. lululemon is also known to spend money on in-store yoga classes where they can stick to their mission statement and inspire and build trust and loyalty among guests by concentrating on providing quality products, and providing a positive and memorable experience. Through this innovative marketing strategy lululemon is able to maintain a competitive advantage over other brands that create a similar product for half the price. Just like their marketing style, lululemon’s business strategy is non-traditional. Before opening a store the company opens a â€Å"showroom† where educators interact with guests through yoga and fitness classes to understand what customers in the area need the most, therefore management differs from store to store, however the results are similar; the guests have a place to be challenged, relax and achieve personal goals. Each store also creates a positive work environment for the educators creating an extremely high quality of work  life because the company cares about all of the educators’ health. An educator at a lululemon location in Toronto was shocked by how much the company cared. â€Å"Ive never before worked for a company that cares so much about my life. They genuinely want you to be proactive in your own life. At head office, employees are encouraged to display professional and personal goals on posters over their desks† Lululemon also uses a proactive strategy as it meets all of the economic, legal, ethical and discretionary responsibilities. These responsibilities are met since the company is valued at over $220 million; they operate legally; want to help people live healthier lives; and is committed to supporting charities. As a result of the strategies used, lululemon has remained to be a successful business with loyal customers because of the unique experience in every store and by giving customers what they want. Recommendations and Implementation Plan The company’s next step is to focus on providing their customers with a better lifestyle where they can find a balance between work, family and health, as it is part of their core values. This could be accomplished by expanding their in-store yoga classes from just the guests, to their entire families. This would allow lululemon to bring in more customers as more people will be involved with the in-store experience. This also would not dilute the main purpose of the business as their focus is to create healthier communities by improving balance between work, family, and life. Conclusion Through being socially responsible can lead to economic downfall, lululemon has become an extremely successful company. This is shown in how it serves the interests of the customers by providing them with quality products and how it meets its mission to help people live healthier lives by providing in store yoga classes. People also have a say in which charities they want lululemon to support, which encourages people to use their products since they will know that money will go to charities. It is evident that lululemon meets its economic and discretionary responsibilities as the company is valued at over $220 million and are still opening stores, and how they support charities in every community the company is located in. Its ethics and legal responsibilities are also met as lululemon does not partake in any unethical practices and obeys the laws set in place. The company also advocates that they will keep their promises. With lululemon entering the global market, it will continue to achieve major success by being socially responsible in any location it operates in.