Lululemon Athletica's PR Gaff Gets Them in a Tighter Spot; Stock Status Drops as Large Sized Women Fall Through the Gap
By Staff Writer | November 15, 2013 04:47 PM EST
Lululemon Athletica is the latest retailer to suffer a PR gaff. The company's news just got worse as an analyst has downgraded their stock to "sell." Sterne Agee analyst Sam Poser changed the status of the Lululemon Athletica's stock from "buy" to "underperform." Why? Because the company admitted that their see through yoga pants bunch up on larger sized women.
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Clothes look better on some people than others. That is especially true for see-through exercise pants. But retail executives are learning the hard way that just because something is true, you shouldn't say it, especially if you're talking to the press.
Lululemon Athletica Inc. sells see-through exercise pants. That works out well for slim women, but the material bunches up on larger women with rubbing issues. Lululemon Athletica's public relations department tried to fix that, but only made the problems worse. This is good news for The Gap, which caters to women of all sizes.
Abercrombie & Fitch was recently slammed by the press for publicly admitting that they don't make clothes for larger-size buyers and their stocks plummeted. Now the founder of Lululemon, Chip Wilson, is apologizing for admitting to Bloomberg that some of his company's pants might be a good fit for larger sized women. He said some people just don't look good in some clothes. He may have been telling the truth, but truth in advertising only gets you so far. Lululemon's shares dropped 2.9%.
The Gap has no problems making clothes for larger sized women, they have specialty stores that cater to them, but they know enough not to use large sized models in advertising. The new Athleta mail-order line is getting popular, but not because of the pictures.
The Gap made $15.65 billion in sales last year. Lululemon made $1.37 billion, proving that the Gap has a much much larger following.
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