Lululemon, the athletic apparel manufacturer, is looking to protect its brand by not making rash short-term decisions that could damage its long-term equity as it responds to the challenges of COVID-19.
Calvin McDonald, Lululemon’s chief executive, discussed this subject on a conference call with investors regarding the firm’s latest quarterly results.
And while he argued that strategic price cuts may be an approach the brand can use in carefully considered ways, making drastic discounts at a time of revenue challenges is not desirable.
“I think the important thing is we don’t need to make – nor are there any plans on making – any short-term decision that’s going to hurt our brand, our positioning, and our price positioning in the long-term,” he said. (For more, read WARC’s in-depth report: Lululemon draws on core brand strengths in response to Coronavirus.)
Price reductions – whether online or in physical locations – must be used with “other levers” that can protect deeper brand attributes that Lululemon has built up over time.
“Everyone should know that we are managing all those decisions through the lens that we won’t take anything that puts our price positioning, the power of our price, and our brand at risk – nor do we see the need to,” said McDonald.
Among Lululemon’s brand strengths, he further reported, are that it does not rely on constantly introducing refreshed apparel items to drive demand.
“Our assortment is less seasonal in nature, as many of our core styles are relevant year-round, and can be held for future use,” McDonald said.
“There is a high percentage of our business that is core, which means we are able to hold and continue to sell [it] for a much longer period of time, and less dependent on the need to flush out inventory.”
Equally, investing in tools that can augment its online social community will have a favourable impact as COVID-19 expands, and once the threat recedes.
“Although, we do not know exactly when the current situation will pass, what we do know is that our stores will reopen,” McDonald said.
“We are planning for multiple scenarios, and, in any one of these, we know that our brand is strong, and has unique pillars of strength that will keep driving our momentum forward.”
Sourced from WARC