Lululemon’s Reputation at Risk
Jan 18th, 2013 by Nadia Gunderson
Known as a company that exudes success by advocating healthy living through the sale of athletic wear, Lululemon faced a brand crisis in November 2007.
Earlier that year, Lululemon launched “VitaSea”, an enticing new fabric that claimed to release minerals and vitamins into the skin upon contact with perspiration. Lululemon claimed that VitaSea would “reduce stress and provide anti-inflammatory, antibacterial, hydrating and detoxifying benefits”. Athletic and health enthusiasts were drawn into Lulu stores to buy VitaSea products.
Although Lululemon’s manufacturers claimed these benefits, Lululemon had not tested the fabric and later faced questions about whether VitaSea’s benefits were real, thus creating an ethical dilemma for Lululemon: do they try to discount the claims or ‘reconfigure’ them but keep the product on the shelves, or take a different approach?
How Lululemon addressed this situation was an opportunity to affirm or a potential risk to the company’s reputation as an ethical operator and trusted retailer.
Soon after the claims were made, Lulu’s (then) CEO, Chip Wilson apologized for the misunderstanding, took full responsibility for the issue and stated that Lululelmon will, in the future, conduct its own fabric testing and not rely solely on the manufacturer’s word.
Chip Wilson’s direct, candid and forthright approach sent a huge message to the market and to Lululemon. An issue that could have called into question Lululemon’s credibility and brand instead confirmed Lululemon’s commitment to ethical dealing in all contexts. Clearly it’s not only high-quality stretchy pants that have taken the company to the top of Wall Street!
Society often criticizes companies for mistakes. However, I believe it is more constructive to analyze how a company responds to its faults and owns up to its mistakes. Lululemon showed how ethics come into play in the face of a marketing dilemma and how an ethical approach is always the right approach.
Article Sources:
Picture Source:
http://www.lululemon.com/community/blog/a-guide-to-lululemon-product-lingo/