Update: Marketing Mistakes Lululemon Style
“I am pleased to announce a wonderful resolution! In addition to a very generous $10,000 check , Lululemon has committed to work with The Family Place to raise awareness about the warning signs of family violence and educate their staff, guests and community on how to help or get help when needed. We value the opportunity to bring this issue to people who may not be aware of our services. The Family Place staff will also be the beneficiary a Lululemon led wellness education program to help them find ways to de-stress from all the sorrow they hear. I am glad that we have worked out an arrangement that will help us all.”
What’s a Marketer to Learn?
Time will tell if consumers believe the contribution and planned efforts outweigh the marketing mistakes.
To put the $10,000 donation into perspective, the Canadian-based retailer makes $25 in profit on every $100 pair of yoga pants it sells. The company has to sell 400 pairs of pants to cover the donation. It is expected to report net revenue of $1.6 billion for fiscal year 2013.
That’s in addition to new quality complaints that have arisen nationwide, particularly about the Groove Pants and Wonder Under products. Consumers have complained the pants are too sheer, pilling occurs after two months of wear, and seams are splitting on pants.
Up to Consumers
Time will tell. At the end of the day, it’s up to consumers. They’re the ones who get to put their money where their mouth is. As marketers, we’ve got to try to anticipate what that mouth will be saying.
As a certified yoga instructor and lover of what I thought was all things yoga – including Lululemon – a recent incident with the company has given me pause as a woman, community member and marketer.
Partners Card is the signature fundraiser for The Family Place, Dallas’ largest domestic violence agency. A full 100% of the $70 Partners Card purchase goes directly to supporting survivors of family violence.
Partners Card 2013 Supporting The Family Place
When one in three women in Texas have experienced intimate partner violence in their lifetime, it’s pretty hard to not support this
great cause. Plus, those who purchase the card receive a 20% discount at a number of area retailers and restaurants, a program which has been in place since 1993.
Clearly, some retailers will opt to not participate in the program, for whatever reason. Fine.
The Lululemon location at NorthPark Mall in Dallas, however, took it a bit further. Not only were they not participating, they then posted on the glass store-front: “we do partners yoga, not partners card.”
Ouch – why the snark? Begin community outrage.
Tacky. Yes. But, we’ve all stuck our foot in our mouth.
Ability to Avoid Marketing Mistakes Skipped
Insert ability to avoid PR nightmare.
Then things got a bit more…hairy.
Lululemon Accused of Lying by Local Media
Local media suggested Lululemon lied when the company said it had a partnership in place supporting The Family Place. The nonprofit said the athletic wear company came to them after the community outrage and wanted to offer free yoga to women staying at the facility. The Family Place said that wasn’t a top-of-mind concern for battered woman. The Family Place also said the most effective support is the green kind – cash money.
For those unfamiliar with Lululemon (lucky you! It’s a costly addiction) their philosophy is well touted throughout the store and on their bags and website, which includes: “strong ties to our local communities.”
The irony of their behavior, to put it lightly, is a bit hard to miss.
National Media Pays Attention
Yet still the retailer refused to acknowledge its behavior was wrong. When you consider this was about a nonprofit organization that support women, and the amount of women who participate in yoga and have the potential to shop at Lululemon – even for men – the retailers behavior is puzzling.
Since, Lululemon stated on Facebook it was putting in place a program for staff of The Family Place – again, not what the organization requested or needed. Facebook followers began questioning the actions of Lululemon, many discussing a boycott and others requesting the company make a cash contribution.
Lulu Gets Snarky with Fans
Somewhere in the flurry of comments, the company said it would make a financial contribution. “We are respectfully making a financial donation to The Family Place.”
However, the comment is literally buried in more than 100 comments, the number of which is growing by the hour, nearly all of a negative sentiment.
Additional questions or comments on the topic, directed at Lululemon, have been directed back to the buried comment within a litany of commentary. When asked for more information about the donation, the company simply would reply: “The donation is a part of our community giving program and the amount provided is between us and The Family Place.”
It isn’t like the Canadian company has been trouble free. In case you didn’t hear about its bout with see-through yoga pants, which required the company to recall an entire metric ton of pants, the company’s chief product officer then stepped down. Then, the CEO announced she’d be leaving once her replacement was found.
Not surprisingly, the stock is down 7% year-to-date and it trails the S&P 500 by 30 percentage points, according to a Motley Fool article on the company.
So, here’s a breakdown on the marketing mistakes. But let’s start with something positive.
What Lululemon Did Right
- After not responding to a number of well documented media inquires on the subject, the company is now responding to comments from “fans” on Facebook and Twitter in a timely fashion.
- While upping their game and now responding in a timely fashion, said comments lack compassion and are coy, at best.
What Lululemon Did Wrong:
- Lying. It’s never ok. Particularly when you can get caught.
- Refusing to talk to the media.
- Waiting too long to respond.
- Not publicly stating they’ve made a donation, and instead hiding it in a Facebook post, then refusing to disclose the amount of the donation. Curious move for a company that’s publicly traded.
What Lululemon Should Have Done
Although most of this should be common sense, perhaps we need to spell out how the retailer should have handled this situation.
- Transparency is key. And we don’t mean see-through pants!
- State how much money the company is giving to The Family Place – show a photo of the check. It would have made the entire situation die down.
But the company didn’t do that. Instead, it’s only getting worse because Lululemon is acting secretive. Funny, considering it is a publicly traded company that must report financials on a regular basis.
Don’t make your customers and fans feel like shit, particularly all of your female clients on a cause related to domestic violence. Someone has to buy your $100 yoga pants. When there are a number of substitutes for your product, you’ve got to remind a user why they should remain loyal to you. Pissing in their pool is a poor approach.
The company should have simply written a check and told everyone they did so, and shared the amount and showed an image of the check. The Family Place could celebrate the gift and the retailer could have gone about its business instead of spending time trying to defend its tacky behavior.
Clearly the idea of a sunk cost – or even just apologizing and owning a mistake – isn’t their style. So much for yoga being a “practice.” Perhaps they’ve simply outgrown their yoga pants.
So What’s a Marketer to Learn?
Karma is a Bitch