By South China Morning Post | Created at 2024-09-22 01:33:06 | Updated at 2024-09-30 05:27:44
1 week ago
A bestselling pair of Lululemon yoga pants costs nearly 1,000 yuan (US$141) in China – three to six times more than similar products from local brands. Yet, the Canadian activewear company stands out as a bright spot in China’s sluggish consumer market, posting strong mainland sales in its latest earnings.
Lululemon’s performance is uncommon but not unique. While many international brands struggle in China amid a downturn in consumer spending and stiff local competition, a select few premium brands have bucked the trend with solid gains in the world’s second-largest economy.
“[Chinese] consumers with real spending power still have a strong demand for products that are high-end, experiential and relatively niche,” said Richard Lin, chief consumer analyst at SPDB International, who stressed that all three criteria have to be met.
Lululemon Athletica, which recorded a 34 per cent year-on-year rise in net revenue in China in the second quarter, sells more than just pricey apparel. It also sells a lifestyle of personal development and fitness. For example, it hosts community events like yoga sessions with local instructors and it partners with inspiring ambassadors – the latest being actor Jia Ling, who shed 50 kilograms for her role in hit boxing film Yolo.
The brand “takes a very localised approach” that is “grounded in wellness” in the mainland China market, CEO Calvin McDonald said on an earnings call in August.
