Lululemon Consumer Insights Report

Lululemon
No Sweat Research
Joe Fraser, Zach Lipson, Claire Mirsky, Cat Proulx

Introduction
No Sweat Research is a research company that focuses on holistic and
accurate research methods and results that help ensure that your newest brand
initiative is no sweat.
We decided to work with Lululemon because we were originally very
intrigued by their recent attention in the media. We wanted to see if their recent
controversy was having an affect on consumers, but we also wanted to explore
trends, as well. So though we focused on exploring the reputation of Lululemon in
college students’ eyes, we also tackled the task of how to increase brand loyalty and
there is support for the trend of wearing athletic wear for your day to day routine.
Secondary Research
The first insight that we made was that Lululemon is in a booming
industry. “The global sports apparel market — which includes women’s active wear
— is set to grow to $178 billion by 2019, according to Boston-based research firm
Trefis. In 2013, in the US, sales of women’s active wear alone reached $11.5 billion, a
9 percent jump from 2012, according to market research firm NPD1.” Sales of
athletic apparel are steadily rising, in particular women’s athletic apparel. The
fitness industry continues to grow as exercise itself increases in
popularity2. Lululemon is fortunate enough to find itself in the middle of a
marketplace that is trending upward.
1 (http://www.businessoffashion.com/2014/01/activewear-lululemon-nike-hm-sweaty-betty.html)
2 (http://www.businessoffashion.com/2014/01/activewear-lululemon-nike-hm-sweaty-betty.html)

Our next insight was that Lululemon’s products are much more popular with
women than with men. In fact, menswear accounted for only 12% of the company’s
sales as of January 20133. The company is looking to draw more male consumers,
even going so far as planning men’s only Lululemon stores for the future. Time will
tell if they’re successful in this venture, but as of right now their consumer base is
mainly female.
Another insight we discovered was that the brand hasn’t completely
separated itself from its see-through yoga pants controversy4. Chip Wilson’s
response to the situation only served to exasperate the controversy, one the
company would like to distance itself from as much as possible.
The core challenge that we identified for Lululemon was overcoming the
damage to the company’s reputation caused by Former LuluLemon CEO Chip
Wilson’s controversial statements about his brand as well as the company’s see-
through yoga pants controversy. When large groups of customers continued to
express their dissatisfaction with Lululemon’s yoga pants, Chip Wilson responded to
the controversy by claiming that some women’s bodies “just don’t actually work for
it.5” Lululemon is an expensive brand in the category, and as such many people
consider it an exclusive brand. When the CEO of an exclusive brand proclaims that
plus size women should not be wearing his products, exclusive can start to border
3 services, Bloomberg, with. (July 29, 2013 Monday). Oh look, he's wearingLululemon!; NowVancouver-based 'women's
brand' is courtingAmerican men. thespec.com, Retrieved from www.lexisnexis.com/hottopics/lnacademic
4 STRAUSS, MARINA. (September 13, 2013 Friday ). Delays prompt Lululemon totrimoutlook; Steps toimprovequality
followingsee-through-pantscrisis result in shippingissues and risingexpenses. The Globeand Mail (Canada), Retrieved from
www.lexisnexis.com/hottopics/lnacademic
5 http://www.businessinsider.com/outrageous-remarks-by-lululemon-founder-chip-wilson-2013-12

on elitist. Chip Wilson is gone now, but the ramifications of his actions can still be
felt in the marketplace.
What information did you set out to gather through your primary research?
With our primary research, we hoped to gather qualitative as well as
quantitative data that would give us a more intimate knowledge of our client and
their situation. Our focus group would allow us to talk directly to consumers, in a
comfortable environment where they could speak freely and share with us their
perspectives. Our in-depth interviews would give us the opportunity to question
participants individually, and our surveys would allow us the chance to gather
valuable larger-scale data. Ultimately, we hoped to learn more about consumer’s
thoughts on Lululemon as a brand, and see if that would help us make a
recommendation to the company, which would help them overcome their core
challenge.
Methods
Our focus group took place February 17th in Ithaca College’s Park School of
Communications, specifically in room 279. We were in a medium sized classroom,
one designed to hold about 30 or so students as well as a professor. We had thirty
minutes to conduct our focus group, which ran from about 10:55 AM to 11:25
AM. Our research team was comprised of 4 team members, three of us taking notes
and one person serving as the moderator.
Cat (the moderator) sat down, and we had our participants shift their desks
so that they were in a half circle, all of them facing Cat to help facilitate

conversation. Our participants were four female students here at the college, all of
them between the ages of 19 and 21. Similarly, our team consisted of four college
students aged 19-21. However, our team consisted of two men (both of whom
served as note takers) and two women. The participants were about 2 or 3 feet
away from Cat, and the note takers sat off to the side about 3 or 4 feet away from Cat
and the group. Claire recorded the entire focus group using her laptop, but put a
piece of paper over the laptop screen so the participants wouldn’t have to watch
themselves on camera and feel uncomfortable. Zach left his phone on his desk to
record what was being said, and after a couple of minutes the phone was moved
closer to the participants in order to get better audio quality. I left my phone on my
desk for the duration of the focus group. On top of that, the three note-takers all
took hand-written notes while paying close attention to the proceedings.
The moderator guide was structured the way it was in an attempt to have the
conversation flow easily and make the most of the time we had to work with. At the
top of our guide was our focus group purpose statement, detailing what we hoped to
achieve. Next up we had a few “probe” questions written down for quick
reference. These questions are open ended, used to get the conversation flowing
again or back on topic. Then, there’s the discussion guide. The discussion guide
sliced our allotted thirty minutes into a few 5 or 6-minute chunks of time, each for a
different topic of conversation. We started out with an introductory phase, laying
the ground rules of the focus group and starting the conversation out with a couple
easy questions. From there, we spent six minutes asking about the relationship the
participants have with fitness, and how they view workout clothing in non-workout

settings. Then we spent six minutes discussing how they viewed our brand’s
competitors, and six minutes discussing what they all thought about Lululemon and
their personal relationship with the brand. Then we dedicated five minutes to a
conclusion, wrapping things up and making sure we covered everything. Our
moderator guide left two minutes open, giving our group some leeway in case one
part of the conversation ran too long.
For the interview portion of the primary research, in total, 8 people were
interviewed for No Sweat Research.
One interview was conducted on Thursday March 5th 2015 at 7:45pm at 214
S Albany, Ithaca NY (the interviewees home) at the kitchen table. The first
participant was chosen out of 3 potential participants in the home, based on the fact
that she was known to the moderator to be the most familiar with Lululemon (the
moderator had seen the participant wear lululemon as well as talk about it in the
past). The participant is a female Environmental Science Major at Ithaca College who
is 20 years old. Before the interview began the moderator gave the participant some
background on the project by introducing the project and research objectives as
well as the parameters of the interview itself. The moderator explained that a timer
would be set for 15 minutes in which they would discuss the research objectives.
The moderator asked permission to record the interview on a computer. The
moderator sat across from the participant in order to easily facilitate the
conversation.
Another interview was conducted on Monday March 9th, 2015 in Rochester
NY at 24 Turning Leaf Drive (the interviewees home) once again at the kitchen table.

The participant was chosen out of the other potential three participants in the home
because she best fit the target demographic as she was a female age 45 compared to
two males. The participant is a 45 year old Pilates Instructor/Mother. Before the
interview began the moderator explained the background of the project as well as
the parameters of the interview itself. Once again, a timer would be set for 15
minutes in which the research objectives would be discussed. The participant was
encouraged to ask questions or for clarification at any point throughout the
interview and was asked for permission to be recorded. The moderator sat across
from the participant in order to easily facilitate conversation.
Both of the interviews mentioned followed the basic structure of the
interview protocol which started with a question about the participant’s childhood
in order to capture their interest as well as to get them talking about themselves and
feeling more comfortable. The questions were purposely laid out from general to
specific in order to ease the participants into the more Lululemon brand-directed
questions. The interview protocol was based on questions that outlined the six
research objectives that had previously been established before the interview
began. First, the interview protocol asked about any physical activity that was done
by the participant as a child. Then, the protocol led to the participant’s personal
attitudes and fitness habits. Next, the specifics of how often the participant worked
out was asked as well as the correlation between weather and the participant’s
workouts. After, the convenience and comfort factor of workout clothes was
addressed. Then, the protocol asked about brand preferences in addition to brand
awareness of Lululemon’s main competitors, Athleta, Nike, and Underarmour.

Lastly, the participant was asked about their awareness of Lululemon as well as
their personal experience with the brand and its products.
Another set of interviews took place on March 20th, both in the afternoon,
and both in the Pub area on campus. Each interview lasted approximately 20-25
minutes. The two participants were chosen based off of their interest in fitness and
their knowledge of pop culture, as well as their interest in fashion. Participants were
both female, 19-20, and white. The interview was recorded with the interviewer’s
phone, and notes were taken with a laptop. The interview protocol was structured
pretty closely with the research goals, and the probe questions were both prepared
beforehand and thought of during the first interview, and then similar questions and
structure were followed in the second interview. The questions for these interviews
had a focus on brand reputation and loyalty, and also the acknowledgement and
participation in trends on campus. The research goal was mainly to find if college
students cared about brand reputation and corporate social responsibility, and to
what extent.
Another set of interviews administered by a different member took place on
Tuesday, March 3rd in Ithaca College’s Roy H. Park School of Communications room
#279. The interviews were fifteen minutes each, pairing up two randomly selected
students from our class two at a time. The pairs would conduct one interview, then
switch roles as the interviewer became the interviewee. Interviews began around
10:55 AM and ran until about noon.
The first interviewee was a woman between 19 and 21 years old, and the
second was a man in that same age range. Both were students at Ithaca College,

sophomore and Junior IMC majors respectively. The interviewer was nineteen
years old and also a student and IMC major at Ithaca College. Notes were taken on
the interviewer’s MacBook Pro laptop, using the Garage Band app to record
audio. There was slight background noise from other people in the classroom, but
not enough to disrupt the overall quality of the audio. The interview protocol is
structured in an attempt to facilitate conversation easily at the beginning, and then
ask more specific questions about the brand itself. It’s laid out in straightforward
format, having an introductory statement and then listing the main questions we
want the consumer to answer. Underneath all of these broader questions are a few
possible probe questions to ask, just to keep the conversation going.
For the last set of interview procedures, both were conducted in different
settings. The first interview took place in one of the hallways on the second floor of
the Park School at Ithaca College. It was at approximately 11:00 a.m. The physical
environment was quiet conditions with limited outside noise. The second took
place in one of the meeting rooms at the Park School at Ithaca College at
approximately 11:30 a.m. There were other students in this room that could have
served as background noise. Both interviews lasted approximately 15 minutes long.
Participants for the interviews were two females both chosen at random but
from the same research class. Both interviewees were female, 19 and 20 years old
respectively. The interviews were recorded with an iPhone recording app. Notes
during the interviews were taken by pen and paper on participant’s key phrases and
expressions to specific questions.

The research goal of these two interviews is to find out where Lululemon is
and isn’t connecting with their consumers. We also want to collect information on
how to help Lululemon be a more successful brand in the future.
The purpose of the interviews is to gain a better understanding of
Lululemon’s student demographic, and understand the public perception of
Lululemon’s brand and products. We want to know the consumers personal
relationship with fitness and workout habits. We also want to understand the
purchase decision-making process of consumers and what drives people to buy, or
not buy Lululemon products.
For our survey portion of the research, we chose to test all of our hypothesis
via correlation because it implies that there is a relationship between two variables.
Correlation can reveal whether scores on both variables increase or decrease, scores
on one variable increase while the other variable decreases, or if there is no
relationship present. In addition, the correlation coefficient (r) reveals to what
extent the two continuous variables are related. Our hypothesis are as follows:
i. *H1: Women are more inclined to purchase Lululemon clothing than men
1. Independent Variable: Gender: Female
2. Dependent Variable: Purchases of Lululemon clothing
3. Predicted Direction of the relationship: Positive
4. Statistical Test Used: Correlation
5. Explanation: We predicted that there would be a positive
correlation between being a female, and purchasing lululemon
clothing.
6. R Value: .227 P Value: .286

ii. H2: People who work out more frequently are more likely to wear
fitness apparel
1. Independent Variable: Workout Frequency
2. Dependent Variable: Likeliness of wearing fitness apparel
3. Predicted Direction of the relationship: Positive
correlation between workout frequency and the likeliness of
wearing fitness apparel.
iii. H3: People who enjoy fitness activities are more likely to be concerned about
their appearance while working out
1. Independent Variable: Level of enjoyment of fitness activities
2. Dependent Variable: Level of concern about their appearance
while working out
3. Predicted Direction of the relationship: positive
correlation between the level of enjoyment of fitness activities
and the level of concern about their appearance while working.
iv. H4: People who work out more frequently are more likely to wear workout
clothing during the day
1. Independent Variable: Workout Frequency
2. Dependent Variable: Likeliness of wearing workout clothing
during the day
3. Predicted Direction of the relationship: positive
correlation between workout frequency and the likeliness of
wearing workout clothing during the day.

v. H6: In colder months people are more likely to wear athletic clothes as daily
wear
1. Independent Variable: Temperature
2. Dependent Variable: Likelihood of wearing athletic clothes as
daily wear
3. Predicted Direction of the Relationship: Negative
5. Explanation: We predicted that there would be a negative
correlation between temperature and the likelihood of wearing
athletic clothes as daily wear.
vi. H8: People who have a higher income are more likely to wear Lululemon
1. Independent Variable: Income Level
2. Dependent Variable: Brand Loyalty
3. Predicted Direction of the Relationship: Positive
correlation between income level and brand loyalty.
vii. H10: Consumers who view Lululemon as an exclusive brand are less likely to
wear the product
1. Independent Variable: View of Lululemon as an exclusive
brand
2. Dependent Variable: Wearing Lululemon clothing
3. Predicted Direction of the Relationship: Negative
5. Explanation: We predicted that there would be a negative
correlation between people’s view of Lululemon as an
exclusive brand and the likelihood of wearing Lululemon
clothing.

viii. H11: Consumers who consider fashion a priority when purchasing workout
clothing are more likely to consider purchasing Lululemon clothing
1. Independent Variable: Level of Priority that Fashion Plays
2. Dependent Variable: Likelihood to purchase Lululemon
clothing
3. Predicted Direction of the Relationship: Positive
correlation between the level of priority that fashion plays
when purchasing workout clothing and the likelihood to
purchase Lululemon clothing.
6. R Value: -.525 P Value: .008
Results
Our focus group had interesting results because we luckily had a very brand
loyal consumer of Lululemon. According to her, what the media was saying about
LuluLemon and the controversy there didn’t matter, because what she cared about
was the quality of the clothes and the customer service in the store, which in her
opinion, was excellent. The other students in the focus group didn’t shop at
LuluLemon very often, if at all, and one student wasn’t aware of what LuluLemon
was. For those students, brand controversy did have more of a weight, especially for
more expensive brands, because if there was controversy it would especially not be
worth the money. On the whole, because the students didn’t wholly participate in
the trend of wearing active wear as daily wear, what they wore to work out had to
be effective, but also inexpensive.

In our interviews, college students showed that a large part of the purchase
decision was the price of the product. Consumers really wanted to find “the best
quality for the lowest price,” as one participant said. There also was a theme of not
particularly brand loyalty, but store loyalty: “I buy Champion leggings because all
my workout clothes from Marshall’s and that’s what they sell there, and it’s
cheaper.” When asked about the reputation of the brand and how that affects their
purchase decision, most students wanted to be brand conscious, but found that they
“can't always afford to boycott companies if their prices are lower than others.”
However, that doesn’t necessarily apply in LuluLemon’s case because their brand in
controversial and expensive.
From our survey research, from our supported hypothesis, we concluded
that people that work out more often are more likely to wear and buy fitness
apparel, as well as be concerned more about their appearance while working out,
and wear more fitness apparel during their day to day activities. We also found that
the more exclusive Lululemon comes off as, the more likely people are going to buy
it, which was particularly interesting because it
From the hypothesis that weren’t supported, we found that women are not
more likely to purchase workout clothing than men, in the colder months people are
not more likely to wear workout clothes as daily wear, those with a higher income
are not more likely to purchase Lululemon, and also those that consider fashion a
priority are not more likely to purchase Lululemon.

Discussion
No Sweat Research has found that, typically, those that are brand loyal to
Lululemon will purchase the clothing regardless of the reputation of Lululemon or
the price, as seen by the participants in our focus group. As seen in our surveys,
consumers that work out purchase work out clothing that they think is trendy,
because they not only want to wear it as daily wear, but also want to look good
while working out. Because of these conclusions, No Swear Research suggests that
Lululemon continue to be trend focused, and design clothes that work with
everyday apparel, because the emphasis on trendiness will continue to attract their
brand loyal customers as well as hopefully bring in those that want to look their best
while at the gym.
Because our surveys concluded that people are more likely to shop at
Lululemon if they see it as an exclusive brand, making the brand too accessible by
the public isn’t a good idea for those that like the luxury aspect of it. However,
making the brand a little more accessible by opening more stores or launching a
campaign that emphasizes the wear-ability of the clothing might help with brand
awareness, which was a little bit of an issue we noticed with some college students.
It will also appeal to the store loyalty that a lot of college students experience by
continuously shopping at Marshall’s, if LuluLemon were available there, it might
help the brand image. Though price is a factor for college students, and ideally
Lululemon should lower the price of it’s clothing if they want to really attract a
larger audience, college students are not opposed to shelling out money if they
know they are getting quality clothing, as seen from our interview results. Because

of this, a quality focused campaign would not only help fix the bad PR gotten from
the Lululemon see-through pants scandal, but should boost sales with the younger
demographic as they commit to investing in the brand. From there, if they enjoy the
clothing, they will develop a loyalty to Lululemon, and as they get higher incomes
they will be more willing to purchase clothing.
Conclusion
Throughout the semester, we gathered an extensive amount of primary data
for Lululemon. In the focus group and the interviews, we experienced some people
who were unaware of the Lululemon brand. Because of this, we were able to extract
useful information from an outside perspective. Since we used convenience
sampling for our surveys, consisting of 22 females and only 3 males, it was hard to
get an accurate reading for the entire student body, much less the American
population. We also realized the importance of creating hypotheses that could
actually be tested and weren’t easily repeated by similar questions.
We started this project with a goal of making Lululemon a better brand by
with the results yielded from our research. Though our research goals did shift
somewhat throughout the semester, in the end I think we accomplished what we
were looking to do and were able to help make real suggestions. When this project
started, in our focus groups and interviews, we discussed more of people’s thoughts
on Lululemon and their competition, while in our surveys we went more in depth
about peoples workout habits and what they wear to workout versus what they
wear casually during the day.

By carrying out these projects we learned the amount of work it takes to be a
market researcher. Every individual aspect of each project must be well thought out
be understood by our test subjects. If there are just some minor mistakes, or if
someone we are testing doesn’t understand a question or what we are talking about,
the data becomes skewed. We learned the art of coding research information and
using SPSS to understand the statistical probability and relevance of our survey
hypotheses.
Research is one of most important aspects of strategic communications
because it is a starting point for all marketing and advertising campaigns. Research
acquires target demographics for companies and their products. We learn who the
target market and audience should be based off of the data collected, and how
different people respond to different products and different messages. All of the
things we learn in market research is used to create ideas to target the correct
people to gain the most revenue and success. None of the success of advertising
campaigns can happen without effective use of market research.

Lululemon Consumer Insights Report

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