Recently, Lululemon did not appear in the top four on the Tmall fitness pants hot list, and was replaced by brands such as Fila, VFU, GIGT and Decathlon. What is particularly noteworthy is that VFU and GIGT, as affordable alternatives to Lululemon, have successfully attracted a large number of consumers with a price range of about 100 yuan. In today's increasingly competitive sportswear market, Lululemon, as a former leader in the yoga industry, is facing unprecedented challenges.
Image source: Weibo
新兴国产平价品牌反攻"Lululemon"
In the field of sportswear, Lululemon once became the go-to brand for yoga enthusiasts with its high quality and unique design, and was known as the Hermes of the yoga world. However, with the intensification of market competition and the diversification of consumer needs, Lululemon seems to be facing unprecedented challenges. In the past, low-priced counterfeit products have tried to encroach on market share through price advantages, but have failed to pose a substantial threat to Lululemon due to quality issues. However, with the rise of domestic brands, this situation is changing.
These domestic brands, such as "Rampaging Loli" and MAIA ACTIV, are not only comparable to Lululemon in terms of design, fabrics, and cuts, but are also more affordable. Founded by fitness blogger Chen Nuanyang, "Runaway Loli" attracts consumers with its sleek design and high-quality fabrics, at one-third the price of Lululemon. MAIA ACTIV meets consumers' demand for cost-effective products with its modification of Asian women's body and discounted price range of 200 yuan to 500 yuan.
Image source: Rampaging Lori
此外,VFU、粒子狂热、FLYYOGGA、焦玛、Tenth Active、COCOFIT等主打伽裤的百元品牌也是较为热门的Lululemon平替。
Under the current trend of consumption downgrading, consumers are increasingly inclined to choose products with reasonable prices and uncompromising quality. This trend is evident not only in domestic markets, but also abroad. For example, CRZ Yoga, as an affordable alternative to Lululemon, sold more than 80,000 pairs of yoga pants per month on TikTok, earning about $2.84 million, showing the strong competitiveness of affordable alternatives worldwide.
The challenge for Lululemon is how to maintain its premium brand image while keeping up with competitive pressure from domestic brands and other affordable alternatives. I don't know if it is in response to the demand for "consumption downgrade", the whole people have started to seek replacement, and the yoga pants economy is also fermenting under the influence of this.
Domestic brands compete for middle-class female consumers
The yoga pants industry is showing an explosive economic boom, which can also be seen from the data. From 2016 to 2021, the market size of the domestic yoga industry increased by 25.1 billion yuan. The scale of the yoga industry is expected to reach 56.1 billion yuan in 2023, with an annual growth rate of 11.6%. Specific to the yoga pants category, it also maintained a positive growth trend. According to QYResearch, the size of China's yoga pants market exceeded $1.6 billion in 2021 and is expected to reach $3.507 billion in 2028. For new brands, it is a fact that the yoga pants category still has growth dividends, but the track has gradually shown a more fierce competition situation.
When analyzing Lululemon's success, we cannot ignore the core competitiveness that is constituted by the value of its brand. While domestic brands still have some way to go to catch up in this space, they are learning from Lululemon's brand ethos to attract female consumers.
In the case of MAIA ACTIVE, the brand has successfully appealed to middle-class women by creating an image of "pleasing yourself and caring for women" and conveying the concept of "every size has its beauty". Most of the mannequins in its stores are slightly chubby, which not only shows the brand's emphasis on diverse aesthetics, but also conveys a unique insight into female beauty to consumers. In addition, MAIA ACTIVE invited women of different ages and sizes to share their stories through a commercial, which enhanced the brand's affinity and empathy.
IMAGE CREDIT: MAIA ACTIVE
Through the story of the founder Chen Nuanyang, "Runaway Loli" conveys the challenge of traditional aesthetics and the affirmation of women's power, wins the support of feminists, and promotes the warm emotional core as the heritage of the brand, which is also the meaning and value of the brand's existence.
Domestic brands are engaging consumers by reinforcing their brand story, philosophy, and connotation in order to achieve a brand premium. THE ACQUISITION OF MAIA ACTIVE BY ANTA GROUP IS A STRATEGIC WIN-WIN FOR BOTH PARTIES. For ANTA, this marks an important position in the women's sports market, helping to strengthen the brand portfolio and bring growth potential. MAIA ACTIVE can make up for the lack of offline community and brand penetration with the help of Anta's resources, and is expected to become a strong competitor to Lululemon in the future.
Image source: Chief Business Review
At the same time, brands such as Li Ning, Nike, and Xtep are also competing in the yoga pants and yoga clothing market, making this field increasingly fierce. Domestic brands such as Bosideng, Perfect Diary, Huaxizi, etc. are on the rise, and the gap between them and Lululemon in product design, research and development, brand building, product quality, and after-sales service is narrowing.
In the face of these emerging and established competitors, Lululemon's market position is being challenged. Domestic brands are gradually changing consumers' perception of domestic products by strengthening brand value and improving service quality, which undoubtedly brings new market pressure to Lululemon. What we need to admit is that domestic brands are becoming stronger and independent, and new domestic representatives such as Bosideng, Perfect Diary, and Huaxizi have emerged. Whether it is in terms of product design and R&D, brand building, product quality, or after-sales service, the gap between domestic brands and Lululemon is gradually narrowing.
It is difficult to break through the male market
In July 2022, Lululemon once exceeded $40 billion in market value with its iconic yoga pants, becoming the world's second largest sportswear brand after Nike, which attracted widespread attention in the industry. However, heading into fiscal year 2023, Lululemon's performance growth has not met expectations. In the earnings report, the company admitted that revenue and profit growth have slowed, and expects revenue growth to further slow to 11% to 12% in fiscal 2024.
Faced with the challenge of slowing growth, Lululemon began to seek new growth points. The Chinese market is a key focus for Lululemon due to its strong growth potential. To this end, Lululemon not only opened a flagship store on Douyin, but also opened its first independent menswear store in Beijing, trying to expand the sinking market and male user base.
Image source: National Business Daily
However, in the sinking market, Lululemon faces no small challenges. Lululemon's consumers tend to buy its high-priced yoga pants for show-off motives, which is similar to the consumption logic of luxury goods. But in order to pursue revenue, Lululemon began to take the initiative to reduce prices and compete head-on with affordable brands.
Since the beginning of this year, Lululemon has frequently launched preferential activities, such as online discounts, full discounts, vouchers, etc., making the price of yoga pants as low as 460 yuan. On the offline side, Lululemon has not only opened new stores in lower-tier cities, but has also entered a number of discount stores, such as Qingpu Outlets in Shanghai, where some products are sold at half price.
Lululemon's founder, Chip Wilson, has said that he wants to sell yoga pants for three times the price of a regular product, without discounting. But the current strategy clearly runs counter to that purpose.
图：Chip Wilson
In the men's market, Lululemon also faces challenges. In fiscal 2023, the growth rate of Lululemon's menswear business has slowed. CEO Calvin McDonald admits that male consumers are holding back when it comes to clothing and sports spending.
In China, the sales of men's yoga clothing are much lower than women's, and more than 40% of male users are driven by female users. Although Lululemon has made some innovations with men's products, the performance and quality have not shown to be irreplaceable. Many men are reluctant to buy Lululemon's products because of the sheer female label. They are more inclined to choose traditional men's outdoor brands, such as Arc'teryx, which is more functional outdoors and has a heavier identity tag despite the higher price tag.
As for the shoe business launched by Lululemon, it has also been questioned by some male users. They felt that the design was too similar to women's shoes and was not professional and environmentally friendly enough to be unattractive. From an industry perspective, Lululemon's shoes are really unconvincing compared to shoe giants like Nike, Adidas, Under Armour, and more.
Image source: lululemon
Overall, Lululemon still has a long way to go on the road to being a full-category sports giant. In the sinking market, Lululemon lacks the cost-effectiveness to compete with affordable brands. Lululemon is in a dilemma. In addition, the full-category operation may dilute Lululemon's professional image in yoga clothing, and at that time, Lululemon may face greater challenges.
In the face of fierce market competition, both Lululemon and domestic brands need to constantly innovate themselves to adapt to the development of the times. Lululemon needs to find a balance between maintaining a high-end image and pursuing value for money, while making more efforts in product innovation and brand positioning. Domestic brands need to further strengthen their brand value and improve the quality of their products and services to win more consumer recognition.
With the increasing pursuit of healthy lifestyles among consumers, the yoga pants and sportswear market still has great potential for growth. Both Lululemon and domestic brands have the opportunity to be more successful in this area. Let's wait and see how the two camps will continue to write brilliant in the future development and jointly promote the prosperity of China's sportswear market.
Sources: Business Economics Review, National Business Daily, Hexun Wealth, etc
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