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Lululemon's Market Segmentation Strategy

Read the attached case study and answer the following:
1. How would you describe Lululemon's market segmentation strategy? Who do you think are Lululemon's typical customers?

2. What generic business-level strategy is Lululemon pursuing? Does this strategy give it an advantage over its rivals in the athletic clothing business? If so, how?

3. In order to successfully implement its business level strategy; what does Lululemon need to do at the functional level? Has the company done these things?

4. How might the marketing and product missteps cited in the case impact upon Lululemon's ability to successfully execute its business-level strategy? What should Lululemon do to make sure that it does not make similar mistakes going forward?


Solution Preview

1. The target market for Lululemon are those who are sports minded and need sports related clothing that is dependable and comfortable. The market segment also includes those who want quality above pricing and are willing to pay the premium price to get the quality they want or need. The typical customer then would be a middle or upper class sports or yoga enthusiast with more disposable income and a need for high quality materials in their clothing. The buyer does not want to have to replace their clothing due to wear, but will regularly buy new items because of fashion or new technology applied to the clothing.

2. The company pursues differentiation. They provide a high quality product with ...

Solution Summary

This response discusses Lululemon's business strategy and marketing plans.