Case 1 Mystic Monk
1. How strong are the competitive forces confronting lululemon in the market for performance-based yoga and fitness apparel? Do a five-forces analysis to support your answer.
High Supplier Power
There are a lot of suppliers available in the market that want to produce for lululemon because of the increased value of the company
High Buyer Power
Other brands offer the same products
Low cost switching because other brands offer these items at a lower price
Moderate New Entrants
Popular athletic brands such as Nike, adidas and Under Armor are specializing in different aspects such as basketball and outdoor sports which are mainly for men thus, it has a different target market and brand identity as opposed to lululemon.
Brands such as The Gap, Athleta, Nordstorm, Lucy and bebe stores are designed for women use however, they offer clothing for women’s sports in general not solely on yoga apparel.
High Threat of Substitute Products
Although stores such as Nike, Under Armor, The Gap, Lucy, etc. offer sports apparel that are not concentrated on yoga, these can still be easily interchanged with what lululemon offers to its customers.
Some brands offer cheaper sports apparel compared to lululemon.
High Rivalry among firms
Bigger brands have more resources and influence over the people because of its popularity.
Other brands also offer high quality, advanced performance features and innovative apparel that are the same with lululemon’s products.
Popular brands have a larger scope in terms of the number of stores around the world.
2. What does your strategic group map of the performance sports apparel industry look like? Is lululemon well positioned? Why or why not?
Lululemon is well positioned compared to its competitors because of its niche marketing. Since Lululemon is concentrated on yoga apparel, it can better innovate its products in terms of its features and quality because they just focus on one usage. In addition, they can
High Supplier Power
There are a lot of suppliers available in the market that want to produce for lululemon because of the increased value of the company
High Buyer Power
Other brands offer the same products
Low cost switching because other brands offer these items at a lower price
Moderate New Entrants
Popular athletic brands such as Nike, adidas and Under Armor are specializing in different aspects such as basketball and outdoor sports which are mainly for men thus, it has a different target market and brand identity as opposed to lululemon.
Brands such as The Gap, Athleta, Nordstorm, Lucy and bebe stores are designed for women use however, they offer clothing for women’s sports in general not solely on yoga apparel.
High Threat of Substitute Products
Although stores such as Nike, Under Armor, The Gap, Lucy, etc. offer sports apparel that are not concentrated on yoga, these can still be easily interchanged with what lululemon offers to its customers.
Some brands offer cheaper sports apparel compared to lululemon.
High Rivalry among firms
Bigger brands have more resources and influence over the people because of its popularity.
Other brands also offer high quality, advanced performance features and innovative apparel that are the same with lululemon’s products.
Popular brands have a larger scope in terms of the number of stores around the world.
2. What does your strategic group map of the performance sports apparel industry look like? Is lululemon well positioned? Why or why not?
Lululemon is well positioned compared to its competitors because of its niche marketing. Since Lululemon is concentrated on yoga apparel, it can better innovate its products in terms of its features and quality because they just focus on one usage. In addition, they can