Believe it or not, lululemon athletica (NASDAQ:LULU) and the Gap's (NYSE:GPS) Athleta brand have been competing for women's yoga-wear sales for 16 years. Although lululemon has been opening stores throughout North America and abroad since its founding in 1998, Athleta did not open its first full-sized store until 2011 after Gap acquired it in 2008. While both athletic apparel brands heavily involve themselves in the community by offering yoga classes and hosting various fitness events, lululemon sets itself apart from Athleta in three key areas.
If you walk into an Athleta store, you're unlikely to see any men's apparel. This is because the yoga-wear retailer has almost no products that target men at all. Unlike Athleta, which only carries apparel for women, lululemon offers athletic apparel for BOTH men and women. While it has not been the company's main focus, lululemon has always carried a men's collection in its stores.
Men can shop either in stores or on www.lululemon.com for any of the following clothing items to suit their workouts: shorts, pants, tees, jackets, socks, and underwear. In performance gear, lululemon provides hats for men along with yoga mats, water bottles, and bags. Time will tell if Athleta will add its own men's line, but for the time being lululemon clearly has the edge in catering to men. This will become even more important in the years ahead as lululemon plans to open up stores that mostly cater to men by 2016.
Larger selection of accessories in stores
While both Athleta and lululemon sell yoga mats and other performance-driven accessories, lululemon stores provide greater selection than those of Athleta. For instance, when you step into a lululemon store, your eyes are immediately drawn to the wall of yoga mats in different colors and sizes. This feature within the store instantly tells the customer, "We are about yoga". Then, customers can browse bags, water bottles, and hats while they shop for apparel as the store displays all of its products on tables and shelves.
While Athleta also sells yoga mats, they do not jump out at you when you walk into one of its stores. Athleta stores display their mats below the check-out counter, and only a handful of yoga mats are present in your choice of about three colors. Furthermore, the store places its bags together rather than staging them around the store on tables and intermixing them with the apparel like lululemon stores. To see Athleta's full assortment of accessories and yoga gear, customers must go online to shop, which means paying a shipping fee unless the item is over $50. If you need yoga gear fast as well as greater selection, lululemon is the place to go.
Active sales associates
Lululemon prides itself on its corporate culture and business model through actively promoting its products. Not only are lululemon sales associates into yoga and exercise themselves, they also wear the brand while they are on the clock. The company educates its sales associates on its products and classes. Furthermore, they reach out to every customer to help assist individuals with items that would most benefit their workouts, sports activities, and lifestyles.
Have a question about what apparel to purchase? Just ask a lululemon associate who will advise you on the fabrics used and the special features of the product's design. With great enthusiasm and confidence, lululemon sales associates will also talk to customers about upcoming classes, events, and programs so they can get involved in meeting others who also enjoy yoga while getting in tip-top shape.
At Athleta stores, you won't get the same type of customer service and immediate engagement. Not surprisingly the store runs more or less like a Gap store only with yoga wear instead of khakis and T-shirts. While Athleta associates also believe in their stores' products and are there to assist, they do not go out of their way to help customers in their search; rather, they give the customer space. For this reason, lululemon gets customers to spend a little more on yoga wear because customers understand the product more thanks to the company's excellent customer experience.
Lululemon has a lot going for it with its men's collection, larger selection of accessories in store, and its aggressive sales people, aside from the popularity it has already gained among women. In terms of selling its brand, lululemon goes above and beyond whereas it could be argued that Athleta does the basics to meet company goals. Foolish investors interested in lululemon should consider these points while evaluating the company's shares as they give luluemon an edge in the increasingly competitive active-wear space.
Natalie O'Reilly has no position in any stocks mentioned. The Motley Fool recommends Lululemon Athletica. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.