Chip Wilson vs. Lululemon - how should this brand grow?

For some context, the original founder of Lululemon (who is no longer actively involved in the day-to-day operations of the business), Chip Wilson, recently made some comments in the press criticising his old company for their 'inclusive choices' of models being used in their promotional activities.

Here's what Chip said:

During an interview with Forbes published Jan. 2, he blasted the company’s “whole diversity and inclusion thing.” He also sounded off on Lululemon’s ads because they featured people he called “unhealthy,” “sickly” and “not inspirational.”     

“They’re trying to become like the Gap, everything to everybody,” Wilson said. “And I think the definition of a brand is that you’re not everything to everybody. You’ve got to be clear that you don’t want certain customers coming in.”

Does Chip have a valid point?

Yes. On a very basic level Chip's alarming comment does have some grounds of logic to it. A well-constructed brand needs to be distinctive to stand out from its competition, but also to be memorable and easily recognisable to potential busy buyers.

Great brands do this by owning a colour, a slogan, having a strong visual identity and owning a certain 'kind of look'. They take a stand, own a particular position in the marketplace and niche themselves so that there is clear difference between themselves and everyone else.

This is Branding 101.

However, brands also need to evolve; and only thrive if an increasing number of people become buyers of the brand.

This point is obviously key.

If you attempt to grow a brand by just appealing to a small niche, subsection of people - the brand will die.

Growing brands succeed by constantly generating a increasing volume of mental bandwidth in the marketplace.

They need to be seen to be everywhere, to be constantly available in people's minds. If you are restricting your raw material imagery to just a certain kind of person in hopes of 'shutting out everyone else' - you're not going to have the necessary content runway grow that brand very much with such a limited pool of themes to choose from.

[BTW - luxury brands can plausibly follow a mass marketing drive with the intended purpose of highlighting how unavailable a brand is to mass consumption effectively, but Lululemon is not following a luxury brand model.

Why Chip is wrong

By the sounds of it, Chip is a great founder. but not a very effective grower of a brand. And as we have outlined in a lengthy post last year, Lululemon has a need to grow their brand pretty aggressively.

They might have built their brand so far on the back of a very particular image of athleticism, but that tight constraint is not what is going to give them easy passage to the next stage of the brand's growth.

Niche brands (like Lululemon started out being) suffer from having a limited numbers of people choosing to support them coupled with statistically lower levels of customer loyalty than brands with higher levels of marketshare.

This statically difficult position to be in means that no brand worth its long-term potential should strive to remain a niche brand.

Lululemon know this and are doing the right thing by opening up the opportunity to build the brand with a much bigger market by choosing to be more inclusive in their choice of featured athletes in their material.

Chip might not like it, but it's the right route to take given Lululemon's strategy.

Political correctness aside - DEI is a no-brainer if the long-term commercial viability of a brand is to be taken seriously.

What takes a brand from zero to somewhere, is not the same as what is going to take it from there to its maximum potential.

Here's a look at the Lululemon strategy: