Lululemon, a premium yoga-focused retail chain, serves two market segments. One segment consists of consumers who are characterized as “trendy urban” and the other segment consists of “wealthy” consumers. The “trendy urban” segment, in summary, is fashion oriented or active women who live in metropolitan areas. The “wealthy” market segment is affluent women who live in either urban or suburban areas. As discussed below, these two market segments are defined by differences in demographics, geography as well as behavioral and psychographic characteristics.
Despite the differences in the two market segments, demographically there is an important similarity between the two market segments, both market segments focus on young adult females. Demographically, Lululemon’s, “core demographic profile for the apparel was females in the 23-34 age bracket.” (DataSift) What differentiates Lululemon from its competitors is how they have captured a younger customer market consisting of people within the age range of 17-19. Specifically, Lululemon has over 100% more pull within this age range than its nearest competitor. (DataSift)
The identity of and the differences between the segments begin to show in terms of geography. The “trendy urban” market segment is typically located within metropolitan areas. These consumers consist of a mix of both “fashionistas” as well as individuals who have placed a high significance on living an active and healthy lifestyle. Therefore, the metropolitan area can cater to both of these values. For the “fashionistas”, metropolitan areas offer a wide range of hip and trending retail locations of their favorite brands such as Lululemon. For the active lifestyle consumer, the urban geographic location provides many channels to practice yoga as well as other athletic/sporty activities.
The wealthy market consumer segment, however, falls under both urban and suburban geographic locations. Where consumers in this segment live is dependent on the specific wants and needs of their living situation to determine whether they stay inside or outside of a city. However, the main focus of these consumers is to find a geographic area that can provide a luxurious and comfortable living situation while offering an arrangement of areas to shop for high end luxury goods, including athletic wear. Therefore, there is a mix of this target market located within the inner metropolitan area as well as the suburban area just outside of cities.
In terms of behavioral market characteristics, consumers within the “trendy urban” market segment seek out a product that is comfortable yet dependable for yoga, or any other sporting activity that they pursue. These consumers fall squarely under the vision that the founder of Lululemon, Chip Wilson, originally had: “wearing cotton clothes to do sweaty, stretchy power yoga exercises seemed totally inappropriate.” (Hill 2004) These consumers would wear Lululemon to perform athletic activities such as yoga. As far as consumers falling under the wealthy market segment, they value quality over competitive pricing when they seek out a product. As the saying goes, “you get what you pay for”; these consumers fall directly under this statement. The “wealthy” market segment consumers are willing to spend more for “premium priced clothing” in order to get the quality athletic wear that they both want and need.
Regarding psychographic segmentation, the “trendy urban” segment of consumers that Lululemon serves lead a very dynamic lifestyle that focuses on health and fitness mainly derived from yoga. As this consumer group is very interconnected through their passion for fitness and yoga, they also have a shared passion for promoting a healthy, happy, active lifestyle. These consumers also heavily identify with the main point of Lululemon’s manifesto. Lululemon’s public declaration of its policy and aims consists of phrases such as: “The pursuit of happiness is the source of unhappiness”, “friends are more important than money”, and “sweat once a day to regenerate your skin.” (Lululemon Manifesto) Many of these “trendy urban” consumers would identify as a “yogi”, otherwise known as a, “person who is proficient in yoga.” (Google Definition) Their interests and values are consistent with Lululemon’s vision: “a place where people could get a sweat in, we wanted to create a community hub where people could learn and discuss the physical aspects of healthy living, mindfulness, and living a life of possibility.” (Lululemon History)
Due to the fact that the “wealthy” consumer target market is generally affluent, these consumers have the resources to buy high end “activity-based clothing”, which in turn, makes them more prone to spending money on clothing that is designed for many different purposes. These individuals come from educated and sophisticated backgrounds and socioeconomically fall within the middle to upper class. This target customer won’t buy new clothing based on the fact that it might be worn out or too old, they buy habitually in order to keep up with the latest trending styles and innovations that money can buy. “Other than their poise and perfect coifs, you can identify members of this gym robot army by their brand of clothing. You’ve seen them at your gym, at the Whole Foods and in line for green juices; they’re the Lululemon ladies and they’re fancy as fuck.” (Blisstree) This consumer segment is also very brand and status orientated, and therefore views and wears Lululemon as a status symbol of high end and high quality, athletic wear.