Lululemon follows key crisis-management strategy, reverses sheer pants problems


Lululemon has such a dedicated and affectionate following, its customers felt betrayed and almost jilted in March when the Vancouver-based yoga clothing company produced pants whose sheerness showed too much.

Company stock sunk to near lows, consumers blasted the manufacturer on Twitter, Facebook and in endless emails and photos and the brand — previously impregnable — seemed to founder.

But with so much at stake, it’s instructive to see how Lululemon turned around the crisis and may emerge from it stronger than before, its image and brand restored and is leadership strength reinforced.

The crisis management strategy is well-tested: Act quickly; stay transparent and proactive in discussing the problem; admit the mistake [C+ on this part as it initially tried to blame the Taiwanese fabric maker]; apologize; fix the problem; and resume normal business activity with an enhanced ability to avoid making the same mistake twice.

The company posted an apology letter on Facebook and announced reorganization of its product structure. It communicated well and often through blog and video posts.

Lulu now tests its products more thoroughly and hired a person to respond to and help the company benefit from customer input — a major need for a retailer in today’s interactive marketplace, where brand affection is so crucial.

The company’s stock hit a record high last week, proof that at least investors think Lulu weathered the storm and emerged on top. The proof will come in long-term purchasing by yoga practitioners and others who appreciate Lulu’s athletic wear, and guerilla retailing practices.

What was particularly smart in the meantime, however, is how the company handled this crisis.

And, finally, from the no good deed goes unpunished file, Lulu’s board apparently held CEO Christine Day responsible and yesterday she said she was leaving. High stakes these crises.

The content of this blog is about crisis management and mismanagement in a digital age. It originates with Steve Bell, who spent 30 years as a journalist for the Associated Press and in four top editor positions at The Buffalo News. He is now Partner/Director of Public Affairs at Eric Mower + Associates, one of the nation’s largest independent advertising, integrated marketing and public relations agencies, with seven offices in the Northeast and Southeast. Learn more about EMA at http://www.mower.com. Steve’s blog is based on his own opinions and does not represent the views or positions of Eric Mower + Associates.

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About steveoncrisis

The content is about crisis management and mismanagement in a digital age. It comes from Steve Bell, who spent 30 years as a journalist for the Associated Press and as managing editor and editorial page editor at The Buffalo News. He is now Partner/Director of Public Affairs at Eric Mower and Associates, one of the nation's largest independent advertising, integrated marketing and public relations agency with six offices in the Northeast and Southeast.
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