Soon, trusts became a new form limiting competition. Similarly, it is important to understand the industry lifecycle stage. You can download Excel Template of PESTEL / PEST / STEP Analysis & Solution of Lululemon Athletica Inc. (2012). - Types of Immigration & Attitude towards Immigrants Given the latest developments such as Brexit and Immigrant detention on Southern border of United States. 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. It requires Lululemon Athletica Inc. to prioritize and focus on marketing the eco-friendly nature of their products over customary value propositions. No plagiarism, guaranteed! - Paris Climate Agreement and Commitment of National Government under the Agreement What are the commitments of the country under the Paris Agreement and what is the general level of consensus regarding Paris Climate Agreement in the country. This will help in better predicting the environment policy of the country. - Level of Consumer Activism Regarding Environmental Concerns Lululemon Athletica needs to know the level of consumer activism regarding environmental concerns is. Check your email - Waste Management What is the policy of waste management in the prospective market and how Lululemon Athletica can adhere to the waste management requirements in that market. - Birth Rate Birth rate is also a good indicator of future demand. Lululemon Athletica Inc. case study PESTEL analysis includes macro environment factors that impact the overall business environment Political, Economic, Social, Technological, Environmental, and Legal factors. 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. 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. 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. - Property Rights & Protection of Technology Oriented Assets Lululemon Athletica should analyze the legal status of various property rights and intellectual property rights protections that are common in US. - Consumer Disposable Income The household income of the country has increased constantly in the last decade and half, compare to the USA market where household income is still below 2007 levels and not increased in real terms since early 1980s. 24-27). This will enable the Lululemon Athletica to determine if required can it hire talent globally to work in that particular market. 3. Studying the demographic characteristics can help Lululemon Athletica Inc. in choosing the right market segment/segments with high growth potential. The Essay Writing ExpertsUS Essay Experts. The marketing department of Lululemon Athletica Inc. can use the information retrieved from social, environmental analysis to target the consumer groups and increase the appeal of offered products to potential buyers. Analyze the Lululemon Lululemon's external competitive environment to identify opportunities and threats. - Unrest within the Country & Chances of Civil Unrest We dont think that Lululemon Athletica business operations are facing any dangers from any kind of civil unrest or internal militant operations in the country. Why consumers' aesthetic sensitivity matters in apparel design evaluation. Lululemon Athletica Inc. must study and predict the labor market conditions to understand how it can attract talented workers and leverage their skills to improve business performance. The PESTEL analysis model supports strategic management by identifying the external factors that present opportunities or threats, based on the remote or macro-environment of the fast-food business, pertaining to the political, economic, sociocultural, technological, legal, and ecological factors (the PESTLE factors). Competition Levels *You can also browse our support articles here >. The late 1800s was an important time for America in business and industry. Is the "Yoga Bod" the new skinny? Some of the environmental factors that a firm should consider beforehand are -, In number of countries, the legal framework and institutions are not robust enough to protect the intellectual property rights of an organization. WebEnvironmental forces could disrupt Lululemon directly or via one of its key suppliers. This strategy ensures that consumers do not capitalize on the low switching costs. Lululemon Athletica Inc. is operating in Textile - Apparel Clothing in more than dozen countries and expose itself to different types of political environment and political system risks. The American clothing company is based in Los Angeles, California, United States. Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. Another threat to Lululemon is increased foreign costs. As Lululemon heavily relies on foreign manufacturers to make their products at a lower price, they have a greater risk of losing those high margins if foreign costs rise. - Price Fluctuations in both Local and International Markets Compare to the level of quantitative easing in last decade the prices of Lululemon Athletica products and prices of overall products have remained sticky in the US market. Some of the legal factors that Lululemon Athletica Inc. leadership should consider while entering a new market are -, Order custom Harvard Business Case Study Analysis & Solution. This gives Lululemon a lot of choice in picking who they want to buy supplies from. Registered office: Creative Tower, Fujairah, PO Box 4422, UAE. 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. Course Hero is not sponsored or endorsed by any college or university. It can lead to uncertainty and suppression of consumption in both short term and long term. Choosing the vision, mission and the reason of existence for Lululemon Lululemon's. Lululemon Athletica can make strategies based on the stable political environment. 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). Below is a demonstration Moreover, considering the development and maturity level of technology in the respective market is also important. A strategic framework for technology evaluation. 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. For example in United States Texas and Florida have different liability clauses in case of mishaps or environmental disaster. The American clothing company is based in Los Angeles, California, United States. Developing strategies that can capitalize on Lululemon Athletica strengths and help mitigate weaknesses and impact of threats of macro-environment. Attitudes (health, environmental consciousness, etc. Entering in countries with high taxation level will directly influence the profitability of Lululemon Athletica Inc. High taxation affects international trade and prevents exports. Lululemon Athletica Inc. must consider the following social factors to conduct macro-environmental analysis: Changes in demographic patterns like aging population, migration trends and socio-economic variables have paramount importance for international business organizations like Lululemon Athletica Inc. With the running of those four brands, the company is collectively targeting consumers of 7 through 35. WebAccording to a survey conducted by Channel Advisors 43% of the consumers in United States of America are discovering products through browsing on various market places 33% of the consumers found products via social media posts on platforms such as Instagram, Twitter , and Facebook . University of San Carlos - Main Campus. Desai, K. J. Attitude towards immigration has come under sharp focus. The companys logo and monogram being seen on their products is something which is easily recognized by every customer. Help, Academic Environmental factors are fast gaining traction not only among consumers but also among regulators and policy makers. Similarly, market segmentation based on social class may be ineffective where social class stratification is low. 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. The growing inequality in many countries is altering the power structure, which has serious implications for international business organizations like Lululemon Athletica Inc. Lululemon Athletica Inc. need to study the traditionally assigned gender roles to align its marketing and communication practices accordingly. In fact, a proper understanding of these factors helps organizations to identify potential business opportunities and threats in the international market (Baines et al., 2011). In some countries, recycling has almost become a business norm. 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 Such an attack could take Lululemon's digital marketplace offline temporarily or cause permanent damage to its information assets (Lululemon, 2017). because now a days all people not buy alder fashion product. Study for free with our range of university lectures! The local business that has been selected to conduct PESTEL analysis is one of the most, renowned clothing brand in North America i.e. Amazing Business Data Maps. Lululemon Athletica Inc. can take it as an opportunity and adopt green business practices to win the trust of stakeholders. Pestel Analysis And Pest Analysis: American Apparel 2014 Words | 9 Pages. - Intellectual Property Rights and Patents Protection Before entering new market Lululemon Athletica should focus on the environment for intellectual property rights. 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. WebView Lululemon External Analysis Worksheet Part 1.doc from MGT 472 at Salem State University. Abercrombie & Fitch brand focuses on offering apparel that reflected the youthful lifestyle for a target audience, which was college students, designed to encourage teamwork and creativity On February 2007, A&F retailer operated 944 stores in 49 States, District of Columbia and Canada. The first Converse All Star shoes was made in the middle 1900 as a shoes for basket ball players. Social factors that leadership of Lululemon Athletica Inc. should analyze for PESTEL analysis are -, Technology is fast disrupting various industries across the board. 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. The purpose of this assignment is to give a close attention to the financial perspective of the Mdelic Wasatch Outerwear as we examine past and current financial data and evaluate company's performance and financial position. Proposal, Assignment Writing In addition, the company's chief executive officer had stepped down. Yksel, I. Technology analysis involves understanding the following impacts -, Different markets have different norms or environmental standards which can impact the profitability of an organization in those markets. Use of social media has become common in a modern business environment. - 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. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. To achieve such aims, data were collected, reviewed and analyzed within the industry. Louis Vuitton is known globally and has a strong image in Singapore, China, Hong Kong and Japan which are leading financial hubs and individuals with high net worth. Lululemon Athletica Inc. can benefit from it and invest in renewable technologies to ensure long-term sustainability. Copyright 2023 IPL.org All rights reserved. - Mobile Phone & Internet Penetration Lululemon Athletica should assess the level of internet and mobile phone penetration in the country as it will it in building a requisite business model based on local needs and realities. Dollarama competes with other stores like dollar tree, which have a similar approach to Dollarama by having prices at approximately $1.25. so there is a big opportunities for converse from these companies. This report will provide useful information which can be guidelines for Uniqlos strategy to enter a new market. after sometime converse launch the denim ,t-shirts cap and everything related to sports. Financial Times Prentice Hall. Lululemon Athletica Inc. needs to consider the investments made by competitors on a micro and macro level to understand how new technologies influence the firms value chain and prevailing cost structure. Springer Berlin Heidelberg. But the business was later expropriated by the Left Wing government. Alternatively, Lululemon's business activities abroad are also subject to the rule-making of local political leaders (Bertels, Koen, & Elsum, 2015). - Gender Composition in Labor Market Lululemon Athletica can use gender composition of labor market to understand the level of liberal nature of the society, women rights, and womens say in matter of societal issues and consumption decisions. If there is huge income inequality in the society then the likelihood of conflict and crime increases. All the regulations about design patent need to be monitored by company. The low-priced products policy could widen the customer group and attract more buyers to boost the sales. 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). It is sensitive to business law regulation in different countries, and they tax regulation. 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. 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. Example in United States later expropriated by the Left Wing government nature of their products something! Competitive environment to identify opportunities and threats where social class may be ineffective social! A new form limiting competition because now a days all people not buy fashion... Opportunities and threats it as an opportunity and adopt green business practices to win the trust of.. 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