Frequent changes in government policies harm business performance by increasing environmental uncertainty. Nevertheless, Dollaramas main competition all strive to reduce prices and maintain exceptional quality, which can be stressful for these companies because when you lower the prices you also lower the profit. - Corporate Social Responsibilities Culture Are Lululemon Athletica present CSR efforts applicable in the new market or does it needs to have new initiative to cater to the prospective market. Leyva, M., Hechavarria, J., Batista, N., Alarcon, J. Managers at Lululemon Athletica need to examine three inter-related environments in order to come up with an effective strategy. Due to limited information from countries' perspective (language barriers), this paper will analyze the European union clothing industry as a whole, in term of the development, the competitiveness and the disparity between top and bottom players in regards to financial performance. It is an WebLululemon Athletica can use psychographic segmentation to divide the potential buyers into different segments based on personality characteristics, buying patterns, consumption opinion, opinion on social issues, leisure activities, hobbies, and many other dimensions. Currently, Lululemon Athletica Inc. is present in different countries, each having own political tensions. However, when there is political chaos, it deters the investors and harms the stakeholders' trust in economic and consequent organizational performance. WebPESTEL Analysis of LULULEMON ATHLETICA EUROPE OR ASIA E Model was proposed by Michael E. Porter in 1979. Lululemon Athletica Inc. operates in a complex and dynamic environment characterized by regulatory changes, growing environmental activism, collective social trends, technological changes and evolving legal system. And change their design with the change of fashion. Economic factors that Lululemon Athletica Inc. should consider while conducting PESTEL analysis are -, Societys culture and way of doing things impact the culture of an organization in an environment. Explain and justify your rating. A., & Gomez, o. Lululemon Athletica Inc. should carefully consider the on-going technological innovations to stay ahead of the competition. This article is only an example By association, should these companies engage in unethical business practices or skimp on quality guidelines, these acts will reflect poorly on the Lululemon brand (Vallester, Lindgreen, & Maon, 2012). Growing economies offer wide-ranging growth opportunities to the Lululemon Athletica Inc. Legal is the sixth factor of PESTEL analysis. - Demand Shifts from Goods Economy to Service Economy The share of services in the economy is constantly increasing compare to the share of manufacturing, goods, and agriculture sector. Lululemon Athletica Inc. must consider these factors to ensure compliance with consumer protection laws. A detailed analysis of the technological environment can help Lululemon Athletica Inc. capture the technological trends to achieve certain business advantages, such as- increasing profitability, boosting innovation process and enhancing the operational efficiency. of the box and hire Case48 with BIG enough reputation. Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. PESTEL stands for - Political, Economic, Social, Technological, Environmental & Legal factors that impact the macro environment of Lululemon Athletica Inc.. Copyright, patents / Intellectual property law. WebThe Pestle Analysis Of Lululemon 966 Words | 4 Pages. - Acceptance of Mobile Payments and Fintech Services One of the areas where US are lacking behind China is Mobile Payments. Trade regulations & tariffs related to Consumer Goods, Anti-trust laws related to Textile - Apparel Clothing, Pricing regulations Are there any pricing regulatory mechanism for Consumer Goods, Wage legislation - minimum wage and overtime, Work week regulations in Textile - Apparel Clothing. If there is arbitrariness in the judicial process then Lululemon Athletica cant be sure of the judgments. With the running of those four brands, the company is collectively targeting consumers of 7 through 35. Service, Dissertation While the consistent $100,000 salary sounds like a promising way to earn capital for Lululemon, the job at Westbeach appears to be too time consuming for Chip to put valuable effort into both companies. International business. (Ed.). Then the core elements of, PESTEL analysis would be considerate and applied to the organizational situations to, assess potential strengths and challenges Lululemon faces being a clothing brand in, Canada and United States particularly. Social factors such as demography trends, power structure in the society, women participation in workforce etc have immense impact over not only the country's economy but also on workforce talent availability and level of consumer demand. that shape strategy and competitive landscape. Lululemon Athletica Inc. need to study data protection regulations to protect the customer data. Accordingly, we never encourage or endorse its direct Key Takeaways The Lululemon SWOT analysis shows that the company needs to improve its business and survive in the current sports apparel market. Common materials used in apparel making such as rubber and cotton are readily available. The external business environment consists of a set of external factors, such as economic factors, social factors, political and legal factors, demographic factors, technical factors amongst others, which are not controllable in nature and affects the business decisions of a firm. Lululemon Athletica Inc. can enter in low taxation markets and benefit from high profits that can be invested in research and development activities. Use research as, 1. The achieve success in such a dynamic apparel stores industry across various countries is to diversify the systematic risks of political environment. Lululemon Athletica Inc. case study (referred as Lululemon Athletica for purpose of this article) is a Harvard Business School (HBR) case study covering topics such as Sales & Marketing and strategic management. Detailed environmental analysis is imperative before deciding to enter a new market or start a new product line. A firm should not only do technological analysis of the industry but also the speed at which technology disrupts that industry. Further, the same PESTEL factors would also be, included in evaluating future prospects and risk that company might face in the future and. SWOT analysis of Lululemon Athletica analyses the brand by its strengths, weaknesses, opportunities & threats. Excessive resource depletion by Lululemon Athletica Inc. can draw the negative response from media, environment protection groups, customers and the general public. Analysis and Comparison of Nike, Lululemon, and Under Armour Under Armours Organizational Function Management The Strategic Differences Between Under Armour and Aritzia Under Armours Target Market: Buyer Behavior and Organization The Internal Strengths and Weaknesses and External Factors Affecting Under Armour With the travel and market competition added together, Chip would increasingly become disconnected with Lululemon, leaving less experienced Lululemon employees to make decisions that could tank the company. The brands set different prices of its product base on design, size and heritage. Lululemon Athletica Inc. must follow the employee/labor health and safety laws as some countries have strict regulations to ensure labor safety. Near the end of November 2013, Lululemon Athletica (Lululemon) became the subject of a viral firestorm after a series of negative events seriously ruptured the company's reputation. Dollarama competes with other stores like dollar tree, which have a similar approach to Dollarama by having prices at approximately $1.25. Similarly, anti-discrimination laws (like equal employment opportunity) also need to be carefully studied when developing human resource practices as discriminatory suits against employer harm the organizational image and affect organizations ability to attract and retain the talent. A firm should carefully evaluate before entering such markets as it can lead to theft of organizations secret sauce thus the overall competitive edge. Technological innovations like this can bring major transformations in the industry and reset the success rules for market players. ), Recent technological developments by Lululemon Athletica Inc. competitors, Impact on cost structure in Textile - Apparel Clothing industry, Impact on value chain structure in Consumer Goods sector, Air and water pollution regulations in Textile - Apparel Clothing industry, Waste management in Consumer Goods sector, Attitudes toward green or ecological products, Attitudes toward and support for renewable energy. 2. A critical study on Various Frameworks used to analyses International Business and its Environment. WebPESTEL ANALYSIS PRESENTATION University Canada West ETHICS, CSR & BUSINESS ENVIRONMENT (BUSI 601) Lululemon Athletica Inc. PESTEL stands for - Political, Economic, Social, Technological, Environmental & Legal factors that impact the macro environment of Lululemon Athletica Inc.. are considered rare or which species are endangered whose excessive consumption can cause trouble for the organization. The power distance within any society shows the acceptance of hierarchy and income inequality. The report also includes a PORTER and PESTEL analysis with the potential impact of micro-economic factors by region on the market. For example an Industry may be highly profitable with a strong growth trajectory but it won't be any good for Lululemon Athletica Inc. if it is situated in unstable political environment. 2. WebLululemon Athletica Inc PESTEL Analysis Posted by Zander Henry on Aug-22-2018 PESTEL analysis is a widely used strategic planning and management tool. WebPESTEL Analysis of Lululemon athletica The Wholesaling Decision A detailed PESTEL Analysis can help managers explore three inter-related environments, i.e., the overall industrial environment where the company is located, the geographic market or country in which it runs its operations, and wider socio-economic factors. Consequently, the employment of additional staff and procurement of new resources to control for technological threats is liable to generate additional expenses. In this situation, the suppliers have a low level of bargaining power. Lululemon is fast growing company that open stores or franchise in market such as America, Japan, Australia and Europe. WebPestel Analysis is a strategic method/ tool used by marketers to analyse and evaluate the organisation's external marketing environment factors that directly impact the They In 2008 International Conference on Information Management, Innovation Management and Industrial Engineering (Vol. - Per Capita and National Carbon Emission What is the per capita carbon emission of the country and what is the overall level of carbon emissions of the country. Entering in countries with high taxation level will directly influence the profitability of Lululemon Athletica Inc. High taxation affects international trade and prevents exports. A detailed understanding of the economic environment can help Lululemon Athletica Inc. estimate the growth trajectory of industry and organization. Integrity, Marketing strategy of Lululemon Athletica Inc, Lululemon Athletica Inc Case Analysis and Case Solution, Lululemon Athletica Inc Case Study Solution. Too new or too complex? The American clothing company is based in Los Angeles, California, United States. Pestel Analysis And Pest Analysis: American Apparel 2014 Words | 9 Pages. As Lululemon Athletica Inc. looks to expand and leverage its competencies and core capabilities, conducting the PESTEL analysis is imperative for developing effective strategies and achieving long-term growth objectives. Registered office: Creative Tower, Fujairah, PO Box 4422, UAE. High unemployment signals the availability of surplus labor at comparatively lower wages. Understanding the demographic trends, power structures, consumers spending patterns and shared beliefs can help Lululemon Athletica Inc. design effective marketing messages and fulfil corporate objectives through informed PESTEL analysis. Following technological factors can influence the business performance of Lululemon Athletica Inc.: The development of information and communication technologies has led towards the adoption of innovative marketing techniques to enhance collaboration with customers. Lululemon sell premium products and they customer are more brand loyal and will stick. Lululemon Athletica Inc. needs to understand the online shopping behavior by considering the generational differences as younger consumers are more inclined to shop online than older customers. What is PESTEL Analysis & its significance for Lululemon. IGI Global. The observation of social class stratification is also important for Lululemon Athletica Inc. Offering luxury products at premium prices to a market where the high-end market is considerably small in number will require Lululemon Athletica Inc. to adopt the niche marketing strategies. It pressurizes the Lululemon Athletica Inc. to develop new products quickly, increase product range diversity, integrate flexibility into the value chain and develop healthy business relationships with value chain partners. While micro environment factors such as competition norms impact the competitive advantage of the firm. Developing a multi-criteria decision making model for PESTEL analysis. Because of Dollaramas mix of alluring prices and exceptional product quality, it remains Canadas leading discount store despite. We believe that Chip Wilson and Lululemon would be better off if Chip remained in his current position at Lululemon. Choosing the vision, mission and the reason of existence for Lululemon Lululemon's. Some of the political factors are governance system, democracy & institutions, military coup chances, probability of armed conflict, law and order in market etc. Number of factories increased throughout the nation, it became one of the leading industrial nations in the world. During the 1960 to 1970 the tennis shoes started to move from games footwear to easygoing footwear and turned into an image for the cheap and grime cultures. Lululemon Athletica Inc. should develop local teams and develop local partnerships for understanding the societal attitudes and norms to tailor marketing strategies according to unique cultural context. The bond rating of national government is investment grade. It must look at regulations and law in each of countries that they operate in. Like all businesses they are sensitive to economic situation on global and local markets. WebPESTEL Analysis is a strategic management tool that Lululemon Athletica management can use to make better decisions. (2009). Johnson, G., Whittington, R., Scholes, K., Angwin, D., & Regnr, P. (2011). Desai, K. J. Furthermore, A&F currently operates four other brands, which are: A&F, Abercrombie Kids, Hollister Company, and RUEHL. Analyze the Lululemon Athletica external competitive environment to identify opportunities and threats. Lululemon Athletica Inc. should consider the following legal factors when exploring a new market. Info: 1099 words (4 pages) PESTEL Example Your Name: _ BUS470 Instructor: Parvathi Jayamohan External Analysis Worksheet: Part 1 (based on Chapter Nike PESTLE Analysis. Entrepreneurial spirit and broader nature of the society. ~ 0.0 Page). Moreover, the business performance of Lululemon Athletica Inc. is also influenced by the extent to which the host country government has spent on core infrastructure development. 4. Amazing Business Data Maps. Since 1960, the company encountered continued financial losses until The Limited purchased it in 1988, when Michael Jeffries became president and chief executive of A&T launching the trademark slogan casual luxury, new style of Abercrombie. - Work Force Productivity Work force productivity in US has grown by 25-30 % in last two decades even though the salaries are not reflecting those gains. Our model papers and solutions are purely meant for Copyright 2023 IPL.org All rights reserved. Help, Academic Lastly, Lululemon Athletica Inc. should study the consumers leisure interests and should focus more on enhancing the customer experience if customers prefer experiential products over traditional product offerings. Dollarama realises that consumers will stand for higher prices on their items so Dollarama has been steadily increasing its prices to keep profits high and as of now this isnt a concern for Dollarama but if they raise the prices of their items too high then it will detract consumers from the product because they can vote with their feet and choose to shop at Dollaramas competitors instead. . With growing market, there will be opportunity to grow. In the startup phase of Lululemon Athletica they had a high bargaining power. Entering in mature industries can be more challenging due to market saturation than industries at the growth stage. If Lululemon Athletica Inc. decides to enter in markets with the corrupt economic, political system, it will threaten the organization's sustainable development by destabilizing the society, harming justice system and endangering the rule of law. Bertels, H. M., Koen, P. A, & Elsum, I. A framework for PEST analysis based on fuzzy decision maps. Lululemon PESTLE Analysis: 6 External Factors Affecting its Business Strategy Under Armour is another example of Lululemon competitors, more similar in size to Lululemon than mega-brands Nike or Adidas. This report analyzes the impact of the pandemic on the Functional Apparel market from a Global and Regional perspective. Send your data or let us do the research. Lululemon Athletica Inc. can benefit from it and invest in renewable technologies to ensure long-term sustainability. If you are looking for additional support andresources related to PESTELAnalysis, please find more PESTEL Analysisresources below: To export a reference to this article please select a referencing stye below: Our academic writing and marking services can help you! A lululemon pestel analysis study on various Frameworks used to analyses International business and its.! Shows the Acceptance of hierarchy and income inequality Angeles, California, United States environmental uncertainty and income.! 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