Recently one of my classmates Lauren Telford wrote an interesting article on Lululemon’s recent public relations disaster, millions of dollars of inventory in the form of see-through pants. Lauren touched on a couple of topics that I found particularly interesting, specifically what Lulu will end up doing with the wasted inventory.

* This is where I would typically post a picture of the see-through pants. However, I have deemed them as inappropriate for my blog so please perform your own google search! *

One option would be to simply throw them out, which as Lauren pointed out may not be the best for their marketing strategy. Lululemon has marketed itself as a brand based on quality and sustainability; throwing millions of dollars worth of yoga pants in the trash does not provide much support for either aspect of this marketing claim. The other option would be to offload the pants to a discount retailer like Winners, but I strongly believe this would be an awful proposition. If they were to sell them to Winners to salvage this economic loss, these products would eventually be seen and purchased by consumers. This would prolong the exposure of this blunder while in my opinion it needs to be handled quickly and efficiently.

Throughout the years, Lululemon has invested considerable time and capital into promoting its marketing mix based on high quality and premium prices. The company was able to effectively convey this to consumers, but the market is now more competitive and it is more difficult to sustain a competitive advantage. Lululemon’s stock was down almost 9% this week, and I believe it was with good reason. Not only has the company wasted millions in inventory, but it has also suffered the opportunity cost of not selling these products. In addition, letting these kind of products get to market has trashed its marketing proposition, and it really makes me question Lululemon’s ability to demand premium prices for their products going forward.

McKayla Maroney is best known as the Olympic gymnast that was terribly unimpressed when she achieved only a silver medal in the Vault event at the London Summer Olympics. Since then, the picture of her reaction once she received her medal has gone viral online. Her popularity increased substantially as her picture resulted in the creation of an infamous Internet meme, an example of which is pictured below, and she has even performed her signature expression with Mr. Obama in the White House. Now, she is the newest spokesperson of Dr Pepper Snapple Group (DPS), the huge underdog to Coca Cola and Pepsi.

I believe DPS getting Maroney on board as one of their spokespersons is a great tactic to position themselves favourably amongst Coke and Pepsi in the minds of the younger demographics. Maroney’s face has crossed millions of peoples’ computer screens, and she has even started acting on the CW show, Hart of Dixie. Needless to say, she is a popular girl with a lot of potential, and her saying that she is finally impressed with something will catch the attention of consumers.

Original article from Seeking Alpha

Maroney’s 7UP Ten Picture from Just Jared