Little Black Stretchy Pants

by Chip Wilson

  Vertical retail comes with its own challenges, however. There are more moving parts in a vertical retail operation. Because people are involved, a great retail company must love people. Hiring, paying, and maintaining staff can be arduous. The overhead expense of operating retail stores must be added to the price of the goods sold. Paying rent, storing inventory, making tenant improvements, and store infrastructure all represent major capital expenditures—and unfortunately, so does theft.

  My new business philosophy would skip the sporting goods stores. I would own my own stores and take both the manufacturer and the retail store revenue. I would make enough money to be able to develop and pay highly-educated people. I would make women’s technical athletic apparel beautiful, and then sell it at a premium. I would do what had never been done before.

  Yet again, the time had come for me to risk everything.

  Defining the Target Market

  My experience taught me that if I saw something three times within a short period of time, it would show up in the mainstream public five to seven years later. In 1998, I read an article about yoga, heard a random person mention yoga in conversation, and saw a poster on a telephone post promoting one of the very first yoga classes in Vancouver.

  But those three things were not the only trigger points for me. That year, I also read a statistic that said 60 percent of the graduates from North American universities were women. I was stunned. When I’d attended university in the seventies, it seemed like female graduates numbered about 20 percent.

  Before 1998, a common assumption was that most women in North America would get married, then pregnant, and leave the job market before the age of twenty-four. That was the case with many of my friends. But, because I’d read articles about eliminating poverty in Africa through educating women to affect lower birth rates, I saw a different future. I believed that a new demographic of highly-educated women would wait much longer to have children.

  I believed this would be the new North American order; a specific market segment that had never before existed. This market segment was the twenty-four- to thirty-five-year-old woman who was single or engaged, had no children, was highly-educated, media-savvy, athletic, and professional. These women travelled, owned their own condos, earned $80,000 year, and were very stylish.

  The more I considered them, the more of an identity, context, and social history unfolded in my mind. I believed this entire pool of women would be untapped by other businesses because the prevailing thought was still: “Why invest in a female employee if she will just leave our business at age twenty-four to start a family?” I knew I was on to something.

  Power Women and Super Girls

  I often develop a sort of “thesis” as a means of truly identifying and understanding various market segments. It’s a branding exercise that provides a historical context for me and enables me to design into the future of that specific target market. I have also found that there is power in giving market segments a name as other social scientists have done (e.g. Generation-X, Millennials, and so forth).

  As I considered this particular group of women, I looked first at their family history and who their parents might have been. It occurred to me that in the sixties and early seventies, the birth control pill had come into widespread usage. The pill immediately transformed the sex lives of anyone under the age of forty, sparking what is commonly known as the Sexual Revolution.

  Women suddenly had significant control over conception. If they did want children, they could decide when, and how many. There was a newfound sense of independence in this ability to delay childbirth. There was also the opportunity to pursue careers that had, to date, been dominated by men.

  Meanwhile, men’s lives did not change with the arrival of the pill, and they had no idea how to relate to this newly independent woman. Thus, came the era of divorce, with divorce rates peaking in the late seventies and early eighties (rates that have since undergone a steady decline).9

  With all the publicity around divorce and equality, a new female market segment was created in the 1970s and 1980s. I came to think of this segment as Power Women. These women put in twelve-hour workdays, kept a clean and orderly home, and did their best to give their children all the love they’d had pre-divorce. What they gave up was their social life, exercise, balance, and sleep.

  Unfortunately, I read that the hormone dosage in the original birth control pill was too high. That dosage, combined with the Power Women’s lack of sleep, work-related stress, poor eating habits, and three-martini lunches worked together to cause the terrible upswing in breast cancer rates in the nineties10. Too many Power Women had looked to their fathers to define business success, emulating both their drive and their toxic lifestyles. Regretfully, for many Power Women, this would ultimately cost them their health and, in some cases, their lives.

  With the rise of the Power Women came a societal shift. These women wanted to be invested in, to rise to the top, and to be treated the same as their male counterparts. The belief that all women would leave their careers at twenty-four to have children had become a thing of the past.

  The 1980s also produced new fashion trends and Power Women were seen in the boardroom wearing power suits with big shoulder pads, a look that spoke to their confidence and their new-found place in the business world.

  The daughters raised by these Power Women subconsciously knew that education was essential because divorce seemed inevitable. They knew that education and a substantial income were critical to managing both a household and a career simultaneously.

  Many of these daughters spent weekends with a newly-divorced father who had no manual for how to be a single dad. These fathers did what they knew best: they got their daughters into sports and became their coaches and mentors.

  As youngsters, I suspect these girls were influenced by Saturday morning cartoons, which traditionally featured men, wearing capes and stretch fabric outfits, running around and saving the world. By the eighties, most of these cartoons had incorporated a female superhero—also wearing tight, stylish, form-fitting suits and capes.

  I felt these powerful cartoon women became iconic to these girls, who were doing what most adolescents and teenagers do: dress in a manner opposite to their mothers. They did not need to look like boys or men to compete with them; cartoon superheroes were depicted as equal to men. I coined this market segment, The Super Girls.

  In my mind, Super Girls didn’t have any context for gender inequality. It just didn’t exist for them in the way it did for their mothers. They knew they were just as well-educated as men and had been brought up in an era that, if anything, favoured girls in education. The Super Girls that I knew had no use for Women’s Events or Women’s Achievement Awards. They were playing in a bigger pool and were the “best of the best,” not the “best of the women.”

  The thesis I created for these Super Girls worked for design and branding purposes, so brand and design had only one person on which they needed to focus. I defined a single Super Girl to be thirty-two years old and born on the 28th of September. I called her Ocean. Each year, since 1998, Ocean never got a day older or a day younger. Every Ocean in the world would be our sponsored athlete, just like Nike choose a few specific men to sponsor. If Nike or lululemon couldn’t make sponsored athletes excited about their product, then the rest of the market wouldn’t be excited either.

  For twenty-two-year-old university graduates, I speculated utopia was to be a fit thirty-two-year-old with an amazing career and spectacular health. She was travelling for business and pleasure, owned her own condo, and had a cat. She was fashionable and could afford quality. At thirty-two, she was positioned to get married and have children if she chose to, and to work full-time, part-time, or not at all. Anything was possible.

  For forty-two-year-old women with two to three children, her former thirty-two-year-old self represented an era when time seemed so available—a time without the pressures of motherhood and when keeping fit was easy.

 
; As my ideal customer and demographic, the thirty-two-year-old in 1998 did not yet exist. In 1998, she was twenty-four. Essentially, I imagined who she would be eight years before her thirty-two-year-old self existed. I then designed for who I knew she would become in eight years’ time. Because Super Girls were iconic to women of all ages, I felt they would best represent the perfect way to dress for a busy life.

  The Church of Athletics

  The stage was set for yoga wear in 1998. The Super Girls had just graduated from university. They averaged twenty-four-years-old but would soon become the thirty-two-year-old urban professionals I’d envisioned. Super Girls were determined not to fall into the health trap of their mothers.

  Yoga was a great way of maintaining balance, and because it was feminine, non-competitive, time-saving (in comparison to surf and snowboarding), and mentally calming, it struck to the centre of what women wanted. I’d experienced the endorphin rush of yoga for myself—I knew it would be on par with other great endorphin producers of our age: sex, drugs, Starbucks, surf, skate, snowboarding… and the soon-to-be-developed “ding” of a smartphone.

  Why Women Would Pay Three Times More

  Even though my product would be three times the price of the most popular existing brand, I could deliver a quality product the customer would buy in volume by going with a vertical retail model. Starbucks was doing the same thing with coffee.

  At first glance, no one could believe a person would pay three times the average price for better quality, but I knew the Super Girls would have the professional jobs that would pay them well. I knew they would invest in their wardrobe. I knew that after owning a lululemon piece for five years, women would know it was the best investment they ever made.

  They would have money, devotion to health, organic food, and athletics. They were fit and were waiting four to eight years longer than previous generations of women to have babies, so they could invest in their wardrobes without any concern of how their bodies might change with pregnancy. There was a propensity for Super Girls to buy fewer, better-quality wardrobe staples that would stay in style longer. Quality material and fastidious construction would cost more.

  The clothing was also designed so that it could be worn outside the gym. Workout clothes could now be worn to go for coffee. Before lululemon, people had never felt comfortable walking around all day in athletic clothing.

  I had met my ideal customer, at least theoretically. To take this to the next level, we had to speak with the Super Girls themselves and ask them to help us create a new future for athletic apparel.

  While I believed women would respond positively to the designs taking shape in my mind, my experience told me it was imperative to contact my target market and listen to what they had to say. My tried and tested way of connecting was to host design meetings and find out exactly what women wanted.

  Initial Design and Formation of lululemon

  Female athletic fashion seemed to die after the short run of Reebok’s step classes and Jane Fonda workouts in the early nineties. Athletic companies were making most of their apparel money from t-shirts with big logos on the front. There was no such thing as an athletic, technical apparel designer. Finding a designer who was 99.99 percent focused on the technical was nearly impossible. Most designers went to design school so they could showcase their individual creativity and design flair on the runway. Design was all about the look. There was no glamour in technical function. If it was good, technical function was virtually invisible to the naked eye. Lastly, yoga was rare in big cities. I was entering unchartered territory.

  Amanda Dunsmoor was a designer I had hired at Westbeach to design outerwear jackets. She was athletic and had the perfect style of a fresh, healthy Vancouver athlete. From my kitchen table in a decrepit one-bedroom Kitsilano apartment, we developed samples in anticipation of conducting focus groups.

  In Amanda’s words: “There was Nike, there was Adidas, there was Reebok, but there was really nothing that catered to women who wanted workout clothes that actually fit and felt good. Chip was really keen on finding the perfect technical fabric.”

  I would sketch something on paper and give it to Amanda to expand into a design. Even though my sketches were usually rough, I made sure I was very specific about certain aspects. I would tell Amanda: “I want reflective here; I think it’s important that the seams are flat and away from underneath the arms and inner thighs so that there’s no chafing; I think it’s important the pants have a diamond crotch gusset to solve for camel-toe and make pants palatable for women to walk to the studio in public.”

  Even in the beginning, the most important item was the pants. Most of the pants in the marketplace at that time were high-waisted, non-gusseted, and shiny with open seams in the worst places. They were just dance tights women only wore when other women were around. Women did not yet wear running tights. I wanted something with a bit of a flare at the ankles so that it was more flattering to women with rounder hips.

  I was adamant that the rise of the pants would mimic that of men’s surf shorts. I knew athletes had a bigger butt and a higher thigh-to-waist ratio. That meant the back rise had to be significantly higher than the low-rise front. Then athletes could bend over or squat without exposing their butt cracks and without having to put up with the doubling up of fabric in the front. I wanted crop tops to vent body heat as yoga classes had moved to dedicated heated rooms. This was a radical departure from the high-rise front and back of the mid-nineties and of styles since 2014. Pants with high-rise fronts in 2018 are in response to women wanting their pant to shape them. In 1998, fit women did not want a high-rise front and wanted a low rise to expose more skin to the air to control sweat in hot yoga.

  The first line was simple. We had two pants, a pair of shorts, and three tops. There were six designs and around four or five sizes of each style. As the fabric was so expensive and a dye-lot was about two thousand metres, we could only buy one colour. That colour was black.

  Even with those constraints, I developed an idea to make the pants with black thread or multiple coloured threads and then multiple colours of fabric trim taping around the neck and armholes of tops. From one black fabric, we created various colour-ways to give the customer options.

  The more we reworked the styles for fit, the more confident I was we had a great product, but I still needed a name for my new company. The Westbeach name had been vital to the success of my surf, skate, and snowboard brand. I needed something for the new line that would have the same iconic and memorable feeling.

  The Name

  I came up with about twenty name and logo possibilities, including Athletically Hip. Another name, lululemon, has a history attached to it.

  At Westbeach, we purchased a skateboard brand called Homless Skateboards. We produced Homless for two or three years, and it was becoming very popular in Japan, so I proceeded to trademark the name. But through the trademarking process, I found there were already countless variations on the name—mainly since hom (or homme) means man in French. Trademarking the name was not a viable option.

  Skateboarding had crested, and snowboarding was blowing up, so I told all our distributors and salespeople that Homless Skateboards was done. It didn’t make sense, I thought, to put any more resources into the brand or skateboarding.

  To understand the Japanese psyche, when you deliver something they love for two years, and then you stop, it becomes doubly valuable, like rare art. That year—1990—as I brought Westbeach’s new snowboard apparel to our Japanese buyers, they said, “Mr. Chip-san, where is Homless?”

  “We’re not doing Homless anymore,” I told them.

  The next year, even as snowboarding apparel exploded in popularity in Japan, the Japanese buyers asked me the same thing. “Mr. Chip-san, where is Homless?”

  Again, I had to tell them we weren’t doing it anymore. At that time, the Japanese yen was its very pinnacle, and Japanese people were buying up hotels, property, and brands in North America as fast as the Chinese a
re in 2018. We got a call from my Japanese buyers.

  This time, it was an offer to buy the Homless brand name. This surprised me, especially since I couldn’t trademark “Homless” and Westbeach didn’t own it. So, when I gave the Japanese a price I thought was ridiculous and they came back after mere seconds to say “okay,” I was astounded. This felt like the easiest money I’d ever made.

  After that, I often thought about why my Japanese buyers liked the name Homless so much. I could see how the big Japanese trading companies were coming up with North American/Western-sounding names because the Japanese consumer at the time wanted “authentic” Americanism.

  On further consideration, it seemed the Japanese liked the name Homless because it had the letter L in it, and the Japanese language doesn’t have that sound. Brand names with Ls in them sounded even more authentically North American/Western to Japanese consumers, especially the twenty-year-olds.

  This felt like a neat idea, so over the next few years, I played with alliterative names with Ls in them, la la la, jotting down variations in my notebook. This continued until the time came to develop a brand name for my new yoga apparel concept, and during this creative experimentation, lululemon was one possibility I wrote down.

  It came out of nothing. Absolutely nothing. And it was risky at the time because the word “lemon” was attached to poor-quality 1980s Detroit automobiles. However, the word lemon also represented freshness. Either way, I would have to see how the focus groups responded to it.

  I wanted a lower-case L to start the word lululemon because I wanted a less in-your-face men’s athletic name. Meanwhile, I sketched a bunch of logos for the focus groups to discuss, then worked with a graphic artist, Stephen Bennett, who put a circle around a stylized “A” that I had sketched. The “A” was made to match the name Athletically Hip.

  The Focus Groups

  As I only intended to be a vertical retail operation, I hired a woman named Amrita Sondhi to assist me in dealing with the hundreds of operational details involved in opening a retail store, including assembling focus groups.