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Lululemon tries to get past transparent pants-gate

Yoga apparel giant LuluLemon Athletica appears to making some big life changes and getting in shape. The company announced it has appointed a new CEO, Laurent Potdevin, former CEO of TOMS Shoes. He will replace CEO Christine Day. What's more, Dennis “Chip” Wilson, the chairman and founder, is stepping down.

LuluLemon has taken heat recently for a high profile recall of transparent pants (not to mention Wilson’s remarks that some women’s bodies aren’t made for said pants). That would be an issue for any brand, but for LuluLemon, its brand and its culture are indistinguishable.

"The company is about a culture, a mindset. And I think their brilliance was being able to tap into that mindset and nurture it for so long," says Candace Corlett, President of WSL Strategic Retail. 

That mindset of health, wellness….and other things.

"Brian Tracey CDs were huge. 'Good to Great was on the book club list," recalls writer and journalist Elizabeth Licorish, who worked at LuluLemon in 2011, while attending grad school. She says she was surprised at some of the material the company encouraged her to read.

"It culminated in Atlas Shrugged, which nobody had read," she says. "Nobody had read Ayn Rand, but you would mention her and their eyes would kind of glaze over, like Ayn Rand and objectivism and we believe!" 

Licorish says employees were also encouraged to join Landmark, a well-known series of self-help seminars and that there was a lot of pressure put on eating right and taking the company’s free fitness classes. "That know that sounds great," says Licorish, "but that kind of translates into pressure to go to cross-fit at 5:30 in the morning before you work all day."

Licorish says customers felt the pressure, too. She says the store didn’t treat plus sized customers very well. I called LuluLemon to ask about this… they didn’t respond in time for broadcast.

"At times these corporate cultures can run amok and I think a little of that happened at LuluLemon," says John Horan, founder of Sporting Goods Intelligence. Horan says LuluLemon’s a strong corporate culture inspires employees, but when a culture starts to get exclusionary, it’s bad for business. Still he says, while the company's brand image clearly needs some remodeling, there's a lot of good there.

"They have terrific people in the stores, people who really are committed to the brand and to the products. That’s the upside to their culture," he says.

Horan says the new CEO needs to be careful not to throw the baby out with the transparent yoga pants.

About the author

Stacey Vanek Smith is a senior reporter for Marketplace, where she covers banking, consumer finance, housing and advertising.
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