Fashion Management Design Lulu Lemon Brand - Essay Example

STRATEGY FOR LULULEMON by Table of Contents Introduction 3 Lululemon brand 4 Social pillar for Lululemon 6 Potential Results of Implementing Sustainability Strategy 8 Conclusion 9 References 11 Introduction The problem of sustainability is gaining more importance every year. The main reason to this is that the progress and evolution along with positive changes have raised some critical moments, both on the local and global scale. Sustainability as phenomena can be defined as a certain condition with social justice and environmental integrity. In this respect, scholars have outlined the toolkit which is used in defining sustainability, intended to assist a company in determination its successful and sustainable path. Table 1. Three pillars of sustainability Source: Slideshare. 2015 The toolkit is implied by the Three Pillars of Sustainability, which contains Economic, Ecological and Social dimensions. The term ‘sustainable development’ was born in 1987 by United Nations Commission on Environment and Development (Brundtland report). Since then socio-ecological issues had to be addressed with a variety of methods by companies and governments (Cordray, 2014). The idea of equal attitude towards the three pillars is grounded on the hypothesis, that human needs cannot be met by one single pillar; economy, ecology and social issues are the three interconnected systems which are to remain stable. In reality, such equality doesn’t exist and economic side tends to be more convincing. Ecological and social pillars are less disputed, but ironically, they are the ones to be stressed in the first place, and the profitability is to follow naturally. In case of Lulu Lemon brand, the past experience and failures in particular need to be traced and analyzed; they are the indicators to show the direction to be followed in order to develop a sustainable strategy. Lulu Lemon Brand The brand known as Lululemon Athletica was established in early 1998 by Chip Wilson. It is a Canadian company, specialized in yoga and athletic clothing. The targeted segment is the educated woman leading healthy and active lifestyle. Basically, Lululemon has developed a community-based strategy, promoting healthier, longer and fun lives (Machelot, 2014). Among the core elements of the company’s strategy are: Design and development of athletic apparel, a combination of style and high quality; Integration into local community; Creation of educational and inviting store atmosphere to encourage repeated visits Promotion of healthy lifestyle with the help of influential fitness practitioners through social media. Basically, the Lululemon brand is not just about selling clothing, it is targeted at building loyalty by means of grassroots marketing, encouraging dedication and involvement in the culture of the company to go far beyond the purchase. The brand sells the invitation to desired healthy life via the creation of the network of fitness and yoga instructors as hosts of various events. According to the chosen strategy and the policy of the Lululemon, being green and eco-friendly is one of the fundamentals of the company as the lifestyle propagandized comes hand-in-hand with the perception of the healthy planet. Due to the website Lululemon is pushing sustainable agenda, and the extensive language is used to describe the anxiety about the reduction of the carbon footprint, huge investments into new technologies and safety. However, the Carbon Disclosure Project revealed that the level of carbon reduction is one of the lowest within the industry. There is one place, though, where Lululemon can be viewed as a leader – it is the stance on healthy forests (Horan, 2011). The company is engaged into Canopy Planet project, aimed at ending of forest fibre use in apparel manufacturing. Thus, the relationships with the environment are considerably satisfying; there is still a lot to be done (Yohn, 2014). Lululemon has a number of dark pages in its history (Machelot, 2014). The situation with the Carbon Disclosure project and the failure of disclosure of relevant information obviously are to indicate, there is a problem with the ethical matter within the company. But much more damage to the brand image was caused by the founder of Lululemon, Chip Wilson, and the comments he made, which were totally inappropriate and were of racist and sexist nature. Also, the company was involved into a scandal concerning the poor quality of the product through a huge number of complaints on the official website and Facebook page. Rather than apologize, the company defended their product quality and suggested the problem lay with clients, not with the product (Machelot, 2014). Table 2. Lululemon’s sales rate after the scandal Source: Yahoo Finance As it can be seen from the figure above, the connection between social and economic aspects is obvious; it is not the quality problem that had the impact on the overall sales rate, but the ill communication that occurred further which consequently led to unsatisfying results. In general, the problems within the company are connected with the ethics, and approach to the social responsibility tenets can be viewed as ‘average’ and leaves much to be desired, which is not enough in pursuit of success. There are internal issues that deteriorated the reputation and they still present a threat for the company’s future. In this respect, of the three pillars of sustainability, Lululemon is highly recommended to dwell on social dimension as the weakest aspect of the company. Social Pillar for Lulu Lemon Despite the theory that the three-pillar concept is the system of interdependent ingredients such as social, environmental and economic concerns; it is globally acknowledged that the social dimension has been neglected. Many scholars have argued that sustainability is an ethical concept rather than the scientific one (Tsang, 2013). Obviously, it is a mixture of both concepts. Practically, the ethics lie to a greater extent in the commitment to sustainability and sustainable development rather than what is needed for the achievement of it. In other words, the social dimension stands for providing the conditions for human existence, potentially welfare, which is similar to the manner ecological pillar provides appropriate conditions for life in general meaning. Taking into account the fundamental level of the social pillar, it goes without saying that all humans have a certain set of needs they want to be satisfied; whether these are the inborn needs aimed at being healthy in every sense – mental, physical and emotional. According to the statement of World Business Council for Sustainable Development, business cannot be successful in the society that fails (Tsang, 2013). A comprehensive corporate sustainability strategy to be found and applied in the Lululemon company goes far beyond the environmental and economic capital, which are supposed to be considered secondary, it must be able to encompass social and human capital. The strategy embraces every aspect beginning with satisfaction of the employee along with productivity up to community and society, protection of health and safety; at the same time addressing the higher level and issues such as fair labour and trade and protection of the wages and the right of the employees. Each aspect taken into consideration cannot but have a rapid effect on the overall success of the company, and in terms of Lululemon and its cases, social dimension is to be regarded in each detail (Machelot, 2014). The roots of the company’s problems go deep into the basis, where the values and core principles are doubtful, due to the behaviour of the head; these cases have created a void of miscomprehension between the company and its customers (Yohn, 2014). The public relations of the company are crucial for the business success on the contrast to the proverb that the bad publicity doesn’t exist. Risks management to a reputation of the brand is the major driving force for the company that adopts practices of sustainability (Tsang, 2013). Lululemon company needs to realize, that implementing comprehensive corporate sustainability strategy leads to attraction and retaining talent of the highest level by means of recognizing the necessity of life and work balance for the workforce along with appealing to human’s desire to feel his importance and contribution to the good. This is to contribute to the employee’s morale and the overall performance. According to CSR Hub, the Lululemon company is ranked considerably low in terms of Community and Governance and the Human Rights section as well (Tsang, 2013). As for the employment issue, Lululemon gets very high marks from CSR Hub, the company is ranked as one of the leaders for Compensation and Benefits. Again, there are red flags concerning diversity – a company gets 27th percentile for the diversity aspect, which is to be referred to as ethnicity more than gender. As for the labour issue, here Chip Wilson managed to make inappropriate comments, referring to child labour (Gamble, 2015). In his interview he noted he supports it, thus helping the poor Asian families. This comment is not just an irresponsible sentence, it is complete neglect of paradigm of the company, which is to be generated by the founder. The manufacturing outsourced to Cambodia and Bangladesh are reported to be operating in extremely bad working conditions. And these conditions are not what investors really want to see. Looking at the present-day picture, it is obvious there are preferable investments (Tsang, 2013). Potential Results of Implementing Sustainability Strategy The social dimension of the sustainability is to be focused on the balance between the needs of the group and the needs of the individual. The strategy, as well as the methods and tools, are to be chosen individually, and the tools used must tie in well with the corporate missions and goals (Machelot, 2014). Table 3. Social pillar. Approaches for Lululemon. The figure displayed above discusses six possible approaches, recommended for Lululemon. The company has to be focused on establishing sound feedback and healthy relationship with the society on a wider scale. Locally, this can be practically fulfilled by means of integration into the community, as this aspect is currently underdeveloped. Corporate philanthropy, as well as community volunteering, would create favourable surroundings for the company to build up its image. Establishing and implementing health and security standards on each and every production phase might play a positive role in the destruction of the image of slavery and working children, which Mr. Wilson successfully created. Numerous surveys and questionnaires tend to show the growing importance of social responsibility of the company. Due to increasing sustainability awareness, the expectations of current employees are increasing at the same time (Tsang, 2013). Competitive wages, safe workplace and job security are just a few factors that aspire to a net positive effect on the society. By taking social pillar as the guidance, Lululemon is to ensure productivity and satisfaction of the employees through providing green buildings and maximizing natural light. It is proven the fact, that ‘daylighting’ in the retail industry does improve sales rate. In case of Lululemon company, social initiatives are sure to have an impact on the behaviour of consumers (Machelot, 2014). The policy of the company must be turned around, from the idea that the problems are with clients, but not the company. All the available social resources of the company are to be targeted at those disappointed clients, who flooded the Lululemon’s website with criticism; at those clients who were accused of being problematic (Yohn, 2014). These measures are to be seen by a company as a getting acquainted with a new, socially healthy brand, ready for healthy relationships in a healthy environment. The specific case of Lululemon company is to show that in the dominant majority of companies, the social pillar is core fundamental which builds up the solid ground for further environmental and economic dimensions development. Before dealing with the environment on a global scale, Lululemon must take care of the inner environment and relationships on a local scale (Tsang, 2013). Conclusion In pursuit of success, a company is to make a difficult and important decision. The choice of the path is to change the further events within the company in a positive or a negative way. There is no lesson better than the bad experience, and Lululemon is the company to learn from (Tsang, 2013). In general, the company didn’t cope with the challenge, created by itself. The primary idea was to build a brand, based on healthy lifestyle and leading to healthy society and environment. The founder of the company failed to realize, that ethics and a respectful attitude are the essential parts of the health. The findings of this study have showed, that the social dimension should not be neglected; billions of companies gained their success with the help of people, working for these companies and buying their products. Thus the three pillar system is not to be viewed as the system, it is a link, where everything starts from the details. Healthy social dimension in the beginning added by healthy environment are sure to result in high profitability of any company. References Anon, 2014. Lululemon Stock Tumbles As Company Cuts Outlook On Disappointing Sales. The Huffington Post. Available from: http://www.huffingtonpost.com/2014/01/13/lululemon-cuts-4q-outlook_n_4587820.html [Accessed June 2015]. 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