Updated: Feb 15
Lululemon could use Mirror to develop post-COVID local communities.
Mirror/Lululemon could leverage health plans to install a pipeline into high earning households around the world.
Mirror could offer systemic solutions to private schools & premium real estate developers.
Lululemon could establish a uniquely consumer-focused product development model that would allow it to create the best-fitting apparel in the world.
Commonly credited with the creation of the athleisure market, Lululemon enjoyed double digit sales growth before COVID-19. The Q1 2020 revenue drop of 17% also outperforms many of the industry peers. According to Kantar’s annual BrandZ ranking, Lululemon’s brand value grew by 77% in 2019 alone, the second-fastest rise across all categories measured.
Founded in 2016, Mirror raised $74.8m from VCs and had a valuation of $300m. Its sales doubled by CV-19, the company is expected to break even in 2021. Mirror offers a connected, interactive device that allows participation in live and pre-recorded fitness classes across a wide range of activities. Costing around $1,500 for the hardware and $39/month for subscription, Mirror boasts a strong celebrity following and a growing base of “tens of thousands” of users.
At the end of 2019, Mirror founder and CEO Brynn Putnam painted ambitious plans for the company to become “the third screen” — a universal, connected device that would support a wide range of services — from ecommerce to telemedicine. She will now answer to Lululemon’s CEO Calvin McDonald.
Why would a founder with a Napoleonic vision, who managed to raise first-round funding with a non-functioning prototype, whilst seven months pregnant, sell a relatively successful startup early? That’s currently unclear.
Lululemon CEO Calvin McDonald has already mentioned plans to dress Mirror instructors in Lululemon gear. One would assume this will be supported by a retail engine, allowing users to instantly purchase everything they see on the screen.
Lululemon is one of the few brands that has managed to establish its stores as functioning community hubs. The new mega-store format pushes the experiential components further — offering a full fitness studio, mediation spaces and “a fuel bar”. However, even the original plan envisioned “a future” with only 10% of these stores in the portfolio and who knows how CV-19 will affect consumers’ passion for in-store workouts?
Mirror could help develop and expand local communities — by facilitating live classes of local trainers for local groups, complemented by occasional bonding workouts in the open. While the $1,500 fitness system is, undoubtedly, expensive, with 40% of the devices financed, the Mirror audience is wider than it may seem.
Mirror could strike deals with progressive employers in high-earning industries to partially subsidise the devices as part of the employees’ health plans (the way gym memberships are sometimes subsidised). Direct sales aside, that would essentially install a Lululemon pipeline into high earning households around the world, making the brand their default choice for sport and casual fashion.
Mirror could offer private schools a way to allow households that own their device, alternative physical education programmes for the kids — more adaptive to the individual needs, abilities and preferences. Obvious human benefits aside, it would introduce Lululemon/Mirror to a highly promising consumer base at an early age.
Finally, Mirror could approach premium real estate developers that often introduce boutique gyms in new developments. How many post-COVID consumers will want to sweat in close proximity to strangers? New premium flats could come with Mirrors pre-installed — and a Lululemon store around the corner — to deliver all the gear one may wish within the hour.
Next level idea
The 2023 Lululemon strategy focuses on creating innovative technical products.
Nulu, Lululemon’s new lightweight fabric, has been developed following an observation of how consumers change sizes to vary garment fits.
The idea: Lululemon could use Mirror to run continuous product testing and produce the best fitting apparel in the world.
Unbiased, real-time data
Unprecedented testing scale
Ability to micro-test innovations
Ability to develop a working subscription model
Lululemon could introduce a product testing subscription where participants would share their body parameters and receive lower-priced products to wear during Mirror workouts. Feeding off the Mirror camera, a computer program would analyse the video stream (without recording it) and make recommendations to the Lululemon product team based on how the clothes fit, are worn (e.g. rolled up) and/or accessorised. This would create a continuous, unbiased, real-time, product performance review at unprecedented scale.
The scheme would inspire iterative changes to existing products, new product development and small scale experiments with immediate feedback loops — offered exclusively to testers.
Obvious privacy concerns could be lessened by the lack of human involvement in data capturing and transparency about what the system actually captures (not video footage). Restricting the scheme to higher fan tiers would make participation more desirable as would an exclusive early bird access to new products.
The scheme would establish a sense of co-creation, leading to higher consumer loyalty, and help develop a Lululemon subscription model that could be offered to a wide consumer base.
The approach would establish a uniquely consumer-focused product development model, supporting continuous testing and improvement, translating into the best-fitting apparel in the world.