Case Detail

Case Summary

Lululemon Athletica

Case Number: 5-216-251, Year Published: 2017

HBS Number: KE1010

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Authors: Alice Tybout

Key Concepts

Branding, Consumer Marketing, Customer Service, Distribution Channels, Marketing, Marketing Communications, Marketing Strategy, Service Strategy, Strategic Positioning


The case traces the development of Lululemon Athletica (Lulu) from founder Chip Wilson's first post-yoga euphoria in 1997 through the sale of all his shares in 2015. Officially founded in 1998, Lulu was built on the foundation of its "miracle" figure-enhancing yoga pants made from a proprietary stretch fiber. The case outlines Wilson's early experience in technical performance wear, which gave him the expertise needed to launch the Lululemon brand with its premium-priced, fashion-designed product line targeted at upscale women. The case also highlights the retailing and promotion approach that drove Lulu's first decade of success. The snapshot of how the Lulu brand cult was born and diffused provides the backdrop for assessing whether the brand has already hit its peak or whether it can sustain the explosive growth that effectively created the athleisure category. To aid in this determination, the case presents two competitors as comparative foils (Under Armour and Athleta) to contextualize Lulu's growth prospects.

The Lululemon case highlights the importance of the competitive frame of reference when positioning a brand and describes how this may differ for the three competitors. The case also allows for a discussion of the challenges of maintaining the congruence of a retail brand with a diverse product line. This struggle is unique to retailers who must fit ever-varied product assortments (not just a single product line) under the umbrella of a single brand proposition, and is particularly relevant to vertically integrated brands such as Lululemon.

Learning Objectives

After analyzing the case, students will be able to: analyze a brand's intended positioning and assess its alignment with product, pricing, distribution, and promotion decisions; apply positioning- and product-driven insights to plot and justify growth opportunities; and understand the strategic considerations in extending a successful niche brand into a larger market where it is likely to encounter new competitors.

Number of Pages: 10

Extended Case Information

Teaching Areas: Marketing

Teaching Note Available: Yes

Geographic: Canada, United States

Industry: Sports apparel

Organization Name: Lululemon Athletica

Organization Size: Large

Decision Maker Position: Founder/CEO

Decision Maker Gender: Male

Year of Case: 2015