Lululemon to support fuller figures?
It looks like Lululemon has learned a lesson, and is working to develop merchandise to fit the fuller-figured population.
In its fourth-quarter earnings call, Lululemon CEO Laurent Potdevin reiterated that the retailer is a "growth company" and is "focusing on extending our brand operating model to all genders, categories and geographies to fully unlock the potential of strong and sustainable growth."
Potdevin specifically pointed to an evolution in the company's tank tops and a new pant assortment due out in the second and third quarters, respectively, as an example of these efforts.
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When asked by Cowen & Co. analyst Oliver Chen for further details about the tank innovation, Tara Poseley, the company's chief product officer acknowledged, Lululemon has fallen short on offering products for women that want more support in their tops.
"You're going to see a better balance of support options in the tank, which has really been lacking, so we're adding four new styles with medium support, and then by Q3 we'll be adding a full-support tank," she said.
Lululemon currently sells tank tops with support ranging from none to medium, and sells merchandise in women's sizes 2 or XXS to 12 or XL. On the call, Lululemon did not say whether sizing would change with the new tank support and pant silhouettes.
However, a company spokeswoman said, "When we have discussed pants, silhouette is about increasing the variety of styles, fabric, fit and function."
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Looking at customer reviews on Lululemon's website, it is clear shoppers have been asking for tanks with more support.
"I think this brand is going to stay very premium," Chen told CNBC, adding that the new fit "is probably more about styling and features rather than body type."
Chen added, "It's a brand that's needing to offer more choice to fulfill the customer need. They're not trying to restructure the brand; the assortment is just getting better."
While it's not controversial for a company to choose to sell merchandise in limited sizes and fits, it is a problem when a high-profile executive blames a certain body type for a defective product.
In this case, Lululemon's yoga pants were thought to be too sheer, prompting a recall in early 2013. Later that year, the company's founder, Chip Wilson, stirred up controversy by saying, "Some women's bodies just actually don't work" for the pants, and that "it's really about the rubbing through the thighs, how much pressure is there over a period of time, how much they use it."
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Wilson's statement and the massive product recall alienated women of all body types from the brand, hurt sales in the short term and motivated the company to undertake a transformation it's still executing. Ultimately, Wilson stepped down as chairman in December 2013, and he left the board in early February of this year.
Maybe now Lululemon executives feel it's safe to stretch product offerings to a forgiving customer.
In its latest quarter, Lululemon reported earnings per share of 78 cents on revenue of $602.5 million. Comparable-store sales rose 8 percent. All three metrics came in better than analysts had expected, though the yoga wear retailer did issue disappointing first-quarter earnings guidance.