- Lululemon introduced a series of new strategies to bring shoppers back to physical stores in the third quarter, including virtual wait lists and a series of holiday pop-up stores.
- The athletic-wear company reported impressive earnings on Thursday, with a 19% increase in total comparable sales for the quarter, which included a 93% uptick in comparable online sales.
- “In e-commerce, our investments are paying off as our sites have demonstrated the ability to more than handle the anticipated spike in volume,” Lululemon CEO Calvin McDonald said.
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Lululemon is identifying unique ways to bridge the gap between the physical and digital shopping experience to bolster sales during the pandemic.
The athletic-wear retailer reported Thursday that comparable sales grew 19% in the third quarter to $1.1 billion, outpacing Wall Street expectations. E-commerce sales also skyrocketed by 93% amid rising coronavirus cases in the US, according to the company.
While executives touted record digital performance on Thanksgiving and
in terms of sales, Lululemon also highlighted its introduction of virtual wait lists in efforts to aid physical-store transactions.
According to CEO Calvin McDonald, Lululemon’s virtual wait-list system gives customers the option to be notified by text when it’s their turn to enter a store instead of requiring shoppers to line up outside. While this technology has long been used in the restaurant industry — and among grocery stores during the pandemic — Lululemon is one of the first major apparel brands to use the tool.
“In our store channel, we will leverage our seasonal stores, virtual wait list, mobile, point-of-sale, and appointment shopping to ease capacity constraints and continue to protect the safety of our store teams,” McDonald said on the company’s quarterly earnings call with analysts in regard to Lululemon’s in-store strategy.
Read more: Lululemon bet big on Mirror, an in-home workout rival to Peloton. Its CEO explains why in-store retail is the secret ingredient for getting inside consumers’ homes.
Celeste Burgoyne, Lululemon’s president of the Americas and global guest innovation, said that while 97% of Lululemon’s physical stores were open, rising coronavirus cases in some regions across the US had led to tighter capacity limits. In turn, the virtual wait list has helped alleviate stress around crowds and prevented shoppers in some states from being relegated to standing in the cold, she said.
“While these constraints can lead to lines outside stores during peak shopping times, I’m proud of how we have successfully implemented several strategies to improve the guest experience and reduce wait time,” Burgoyne said on the call.
Additionally, Lululemon is operating its “largest number of seasonal stores this holiday” in the form of 70 total pop-up locations across the nation, with goals to reach 100 total in the fourth quarter, according to Burgoyne. These stores have not only helped to bring in new shoppers but also assisted with coronavirus-related capacity stressors at heavily trafficked malls where Lululemon was already operating.
“In total, we have opened 14 pop-ups within close proximity to existing stores, and we’re also operating nine gifting hubs in malls where we already have a mainline location,” she said. “These temporary locations not only help support an improved guest experience, but they also attract new guests into the branch.”
Other additions, such as digital point-of-sales operations outside stores for returns and quick purchases, have also aided the company in bringing more shoppers back to its physical stores.
These brick-and-mortar innovations also support Lululemon’s robust enhancements to its e-commerce business, including “investments in IT infrastructure, fulfillment capabilities, and our guest education center,” as well as a recent partnership with Afterpay, Burgoyne said on the call.
Ultimately, McDonald said doubling down on e-commerce helped the company meet overwhelming demand for Lululemon products, as many Americans continue to work remotely and sequester in their homes.
“In e-commerce, our investments are paying off as our sites have demonstrated the ability to more than handle the anticipated spike in volume,” McDonald said.