Why Activewear Consumers Are Looking Beyond Lululemon

0:00This episode of the BOF podcast is brought to you by Macy's. Sometimes the accessory is the outfit. This summer at Macy's, we have the Kate Spade tulip tote, which is structured but easy to carry all day. And jelly sandals are the shoe of the summer. Translucent, lightweight and just really cool. Oversized sunglasses and the same clear vibe tie the whole look together. For beauty, Clarins Lip Oil and the new La Vie Belle Body Mist from Lancome. Find it all at Macy's, in-store or at macy's.com.

0:43Hello and welcome to The Debrief from the Business of Fashion, where each week we delve into our most popular BOF professional stories with the correspondents who created them. I'm senior correspondent Sheena Butler-Young.

0:59For the last decade or so, if you were a certain kind of woman, the decision of what to wear to the gym wasn't really a decision at all. It was Lululemon. The aligned leggings, the defined jacket, the top that worked both at brunch and at Pilates. At some point, Lululemon was so popular that the product and the lifestyle became the same thing. But the times they've changed. First, there were brands like Aloe and Viore. As athleisure got a second wind during the pandemic, they built heat through celebrity visibility and a softer, lifestyle-driven cool. Then came a second, faster wave of smaller brands, built almost entirely on TikTok, and run by founders who felt more like friends than executives.

1:43Joining me today is BOF editor Kat Chen to discuss whether activewear leaders like Lululemon are truly ceding share to these emerging labels, And are these brands built to last or are they just next in line? Kat, welcome to The Debrief. Thanks, Sheena. Glad to be here. Okay, so before we get into what's happening right now, I think it's worth rewinding to understand just how dominant Atleisure's old guard actually was. So there was a BOF case study in 2020 that described Lululemon at the height of the pandemic boom that it was experiencing. So it described it this way. The stock was at an all-time high.

2:18there was a strong community model and it had 92 % retention among its top spenders. Kat, what made that version of Lululemon so hard to compete with, as if the numbers don't already make the case? I think what's really important to note is that Lululemon in the past two decades effectively cornered the market on active wear as a status symbol. Like Lululemon was and is to an extent still a status symbol to millennial women and to Gen Z and Gen Alpha teenagers. And they kind of coined the ability for something functional, leggings, sports bras, something that you wear to the gym to exercise. They effectively invented a new version of this functional product to be as much of a signifier as a luxury handbag or a watch or, you know, whatever other status symbols that exist in fashion.

3:23Lululemon created that for activewear. And I think Lululemon walked so that some of these later brands like Aloe Yoga could run. and it's really important to give them that credit. And it comes down to the status symbol of it all. I want to talk a little bit about the how, like how they did that. One of the things that has come up a lot in BOF reporting over the years on Lululemon's dominance is this whole community model, right? Like the yoga instructors as the actual brand ambassadors, having in-store sweat sessions, you know, that they were able to cultivate a sense of belonging and community and then, you know, affiliate that with product.

4:03Why was that so effective? Was that really that novel at the time? I think that a lot of different activewear brands were leveraging this model. I'm sure the giants of this world, Lululemon and Nike, were doing it first. I mean, Nike certainly did with its run club and various sort of local activations. And as working out, exercise, the sort of active lifestyle became more salient among young consumers. Obviously, this community-oriented model became even more effective in driving interest in these brands and giving them credibility as real activewear brands. and you saw Gymshark sort of do their own thing with it and Alo Yoga with its yoga studios, I think this model still very much works today.

4:58The difference is that the number of players in the space has exponentially increased. And by the way, we should probably acknowledge that their product also felt that was probably a bigger deal by some people's standards than the marketing, than the community focus was that it to people felt innovative. It looked, they were black leggings, but they looked more interesting somehow. The logo wasn't as recognizable, you know, as a Nike logo, like it meant something. So I want to talk about, you mentioned like Aloe following a similar marketing and community building strategy. So Lululemon stock actually peaked, you know, it hit the all time high at the end of 2023, which is right around the same time that Aloe and Viore started carving out more meaningful market share.

5:43People weren't just talking about them online. They were growing. What do you think they were doing that started to get them momentum and buzz? Was it just another option or something else? I think a little bit of both. Aloe was much more fashion forward. Aloe was really the first activewear brand, studio activewear brand, to incorporate trendy fashion styles into their performance assortment. And they continue to be sort of that more fashion forward, edgier activewear option. Viori had this laid back California cool, you know, that defined a different type of activewear lifestyle than Lululemon.

6:28Gymshark at the time was all about lifting culture, gym culture, hyperlocal, gifting to trainers. And then you had On Running that was more polished. It had roots in tennis, a lot of high-profile collaborations with brands like Loewe that made on another premium activewear label that really even today, you know, rivals Lululemon and is a big contender to Lululemon market share. It's interesting because you speak about it in a very balanced way that there was, you know, new contenders coming up, Lululemon still being, you know, successful, Nike still being successful in women's. I mean, I think we could also lay some data out here that backs it up.

7:17Like Nike's women's businesses, what, nine point something billion. Lululemon is maybe a billion dollars behind that. These are formidable brands. But in 2025, both Lululemon and Nike, which lead in the women's market, they were waning, right? They were not weaning to irrelevance, but certainly not as dominant as these other players carved out market share. How would you characterize what was happening, why they felt less significant in the court of public opinion than maybe their contemporaries that were coming up? You know, that was the question that I set out to answer when I was reporting my story about this newer, maybe more obscure crop of active war challengers.

7:59And the answer that I got overwhelmingly from my reporting is that, honestly, we're just in this moment of desire for newness. And yes, I do think that both Lululemon and Nike has had their fair share of missteps. And I think that they could have exerted more dominance in meeting the appetite of consumers for newness. But right now, what's happening is that we've had two decades of having an automatic go-to when it comes to dressing yourself at the gym, right? Or dressing yourself to yoga. It's Lululemon. You know, even today, as you mentioned, you know, these are billion, billion dollar enterprises.

8:45You go to a Pilates class and half the women will be wearing Lululemon or maybe even more. But then the rest of the class will be wearing labels with logos that you've never seen before, or I hadn't really seen until recently. Let's talk about them. Let's talk Talk about some of these labels that you wrote about. So this emerging crop, set active, 437, honor, form, splits 59. I love what Anisha Sherman, she's an analyst for Bernstein, how she described it in your story. She said, they're appealing to a new use case with similar products, which I took to mean nothing incredibly radically innovative here, but that they found a new way to speak about pretty much the same kind of product.

9:30What do you make of what she said? Yes, absolutely. What she meant was that the product offering among these brands really is not innovative, not radically new. I mean, I wrote a story last year about the emergence of new workout silhouettes. So like baggy pants and long shorts and oversized tops. Very different from, you know, the studio sort of bra top leggings that look. Except these brands aren't even going after that new aesthetic. They're not reinventing the wheel at all. We're talking leggings. We're talking bra tops. We're talking bike shorts. Wasn't there one with lace? There was like one with lace legs that I have to say, I have to say, when we do our next yoga session, Kat, as a BOF team, I mean, they looked pretty cool.

10:26What was that brand? That's Florida Mall. They're actually a very new entrant into this space because Florida Mall is a lingerie brand. And I wanted to use that brand as an example because I had a really interesting chat with the founder, Jen. and she was saying that she held off on coming into activewear for many years because of how saturated the space already was you know with the aloes and buries and whatnot but she felt something change in the past year or even in the past couple of months this vibe shift where yes there are many options for activewear but she felt like among her friends and herself there was just this need for newness, desire for newness, all of a sudden, and this is a refrain that I heard over and over and over again, all of a sudden people were like, okay, I have Lululemon in my closet.

11:24What's next? I don't want to wear Lululemon anymore. You know, I'm sick of this same offering, the same logo, and I want something new. Even though that's not newness in terms of styles. It is newness in terms of the brands that she's looking at. The other thing that's interesting about these brands, and I'm sure it'll get less interesting over time, is how they're speaking to the consumer, how they're using social media, you know, not the big, buzzy, glossy campaigns, but these very behind the scenes. It's as I said earlier, like the founders, not as executives, but as your BFFs. And even the employees, whether they're working out of a warehouse or a small office, even them trying on the clothes, all that very approachable kind of marketing.

12:11Talk a little bit about how they're approaching social media and selling the idea that they're new and interesting. Absolutely. Yeah. So, you know, what's interesting is that a lot of these brands aren't new. A lot of these brands like 437 and Set Active, they've been around for almost a decade. But what they have done incredibly well is build organic followings on social and be able to capitalize on certain TikTok trends. And so, for instance, you mentioned BTS. That's a great example. An example that, you know, these brands brought up separately in my interviews of doing BTS content, you know, interviewing the employee at the office.

12:54that's the sort of very down to earth, grassrootsy kind of videos that are performing well on social media. And I think these brands have just, they have the benefit of being small brands. They have the benefit of the founder coming in every day, trying on the products herself. And I think it makes a big difference in being visible to the customer who wants something new. And so, you know, a lot of this phenomenon is doing the right things and showing up at the right place at the right time and being able to serve a customer who is simply craving something new, something novel. We'll be back with more of The Debrief right after this.

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16:44The other thing you're reporting brings up is this shift in the way women exercise. I remember reporting on some of this, you know, I think it was Nike that was doing like a big women's revamp around the like 2015s. And I think the headline and maybe it wasn't Nike only, but a lot of the brands were saying, you know, she's not just going to the gym. She's going from the office to the gym. And I think we're hearing a newer version of that, right? So she's no longer doing one kind of workout. Maybe it's Pilates on Monday and tennis on Tuesday and high rocks on Thursday. There's different kinds of physical activity that's coming up that's trending, whether it's paddle ball, all of these things.

17:20How much is that important that a woman is changing her style of exercising? And as I've alluded to, is that true? I think it's absolutely true. Not only are people doing more kinds of exercises, they're exercising more. You know, Jen, the founder of Florida Mall, she was telling me she exercises, she works out almost every day. the the CEO of Honor was saying you know he hears from customers who work out four to five times a week which is still you know a lot of workouts a week and I think that is that alone is fueling some of this desire for newness when you are picking out a workout outfit every single day you want some variety in that wardrobe and a really great analogy that I gleaned from my reporting that unfortunately I wasn't able to include in my story came from Trinalytics, which is this trend analysis company.

18:17And they were saying that what's happening in activewear is very similar to what happened in beauty a few years ago, where the category was dominated by a handful of brands. And maybe there were a couple of emerging newcomers, but we've reached this inflection point where people want something that feels new. And I think that begs the question of what is going to happen to this newer generation of activewear brands that are doubling, tripling sales every year? Are they going to see that momentum carry forward? Probably not. Will they fall victim to an even newer generation of brands popping up?

19:05Probably. Honestly, probably. If the history of what both of us and probably our collective team at BOF has reported on is to be believed, there's usually a shaking out after so much growth. We're not manifesting it for any of these amazing brands, but usually there's some downsizing. And to your point, whether or not the next crop comes up, that would be the most optimistic read. Sometimes it's downsizing and there's a slowdown that sticks for a while. I want to talk about something else that is a potential opportunity that came up in the story, which was brands trying to live at this intersection of fashion and performance.

19:41It's another thing that on its face to me doesn't sound all that new. Like I think that's what Nike had been pushing to do in the last couple of decades, understanding that you can't take the same model that you sell to men and sell it to women, but that she wants, you know, different use cases in her day. It sounds like these brands are saying that they're able to like, you know, this is a lifestyle look versus a workout look. Is that new? Is that effective? How are they doing that differently? Yeah, so you're absolutely right, Sheena. I don't think this idea is new, the balancing act between fashion and performance.

20:18And I think the goal for these brands is to not come off as intimidating the way that hyper sort of performance focused products can be intimidating to someone who simply loves to exercise or too fashionable the way that super edgy trends can be intimidating to consumers. And I think Aloyoga and Nike sort of sit on the extremes of that. And I think what these brands have done a really great job is just being sort of the most approachable lifestyle brand and not just sort of hitting the balance right. They want to also hit this note of being discerning and being tasteful. One thing that I've heard again and again from some of these founders is the idea that their customer is a stylish woman.

21:14She is very judicious about the brands that she wears. She's judicious about the trends that she participates in. She decorates her home in a very tasteful way. And so I think what they are trying to do is be that activewear brand to them. It is be tasteful and resonate with sort of that lifestyle that they're curating. You know, as you were speaking, I thought of the little fledgling startup brand called Skims by Kim Kardashian. Obviously, I'm being hyperbolic. But it's funny when she was one of our BOF 500 cover stars. And in a conversation that we had for that cover, she mentioned, you know, her own journey with lifestyle athleisure brands and saying that either something was too performance driven, and she couldn't take her kids to school or something was too fashionable, and it didn't have the hold she needed for a workout.

22:07So I think we're both kind of saying something similar, which is I think you're right. There's this is like the big test for all of these brands. Can you do both? And if you do both, it's going to be your biggest selling point, probably. Right. Is there something that these brands are doing beyond the social media BTS, which, by the way, Nike can do that if they wanted to. They have multiple amazing HQs that they could take you behind the scenes. Lululemon, the same thing. Skims, the same thing. Is there something that these brands that you wrote about are doing that a 10 billion, 50 billion juggernaut can't?

22:40Is there something that they're doing that is unique that cannot be replicated by a larger company? I feel like, yes, this is the one thing that, you know, we are coming back to again and again is just novelty. But this is like a fun marketing exercise for Lululemon and for Nike. can your brand can your very familiar brand be novel to their consumers like to your consumers right and I don't know the answer to that question I don't I'm not that creative you know but I do think that you know maybe there is a way and also it's like there are some things that the Lululemons and Nikes of the world shouldn't compete on going back to this idea of fashion versus performance I don't think Nike should try to be both or like try to strike a balance.

23:36I think Nike needs to go all in on performance because that's what the brand stands for. Right. And for Lululemon, I think that balance is a little bit more salient. So let's talk a little bit about the longevity of the brands that that you wrote about. So, you know, you have set active and form that are doing the whole founders, influencer model. But that sort of ages out over time. The founders age out of the news feed. People get some kind of fatigue of hearing your rags to riches story or you're in the warehouse, you know, packing up the garments to ship them yourselves kind of thing. At what point does this model become a ceiling, the marketing part of it?

24:16Does that get old? And at what point does it get old? I think newness inevitably grows old, right? And so the tricky part for these new brands is how do they continue to pump out newness? How do they continue to feel fresh to consumers? whether that's through product innovation or following whatever new TikTok trends that emerge. And going from there, I think sort of traditional avenues of scaling will become very relevant to many of them, including wholesale, including retail. And I think many are in a position to start leveraging those distribution channels. But I also, I look at the beauty space and I think about all the up and coming high valuation beauty brands that have passed through in the past decade and how many of them were able to maintain the momentum and how many of them failed.

25:17Only time will tell. And also their best efforts will also have an impact, of course. I want to end this on what I kind of started out with, which is Lululemon. So it's funny that the two big women's athleisure players, Nike number one, Lululemon number two in revenues, they had a little bit of musical chairs. So Lululemon's new CEO, Heidi O 'Neill, was at one time the highest ranking or I'm pretty sure the highest ranking woman executive at Nike running their stores. If you could meet with Heidi as she's in her first few months in the role of leading Lululemon, not back from the peripheries of relevance, but to continue to grow and move out of this sort of slower period, what would be your one big piece of advice if you had five minutes with her right now?

26:07Oh, my God. Sheena, I am not in a position to give the CEO of Lululemon advice. I mean, I'm sure she's reading your story and taking notes. It's just one thing that you think would be relevant to say to her based on what you've reported on just about these challenger brands. Hmm. If there's one thing. Wow. OK. Well, it would be an honor if she were to ever come to me for guidance. But I do think that the era of Lululemon as a status symbol is ending. I don't know if the status part of that has viability anymore. And so the question for Lululemon is, if you're not going to be a status symbol, what will you be?

26:59And I think they've struggled with this, right? You've seen a lot of discounting on Lululemon, and that's hurt. I think that's hurt their perception a little bit. that's muddled up their perception. I think it's, yeah, I think the question that I would ask her is, what do you think Lululemon should stand for in this new era of activewear? And I think, you know, it's a very sort of top-down abstract question, but I do think that Lululemon needs to figure that out because their identity has become extremely muddled. I think that's brilliant. I think it's huge and philosophical. And I think it's a good question to ask Kat.

27:46You undersold your expertise. Thanks so much for joining us today. That was a great note to end on. It was my pleasure, Sheena. Thank you for having me. Please be sure to check out Kat's article, the TikTok savvy activewear brand stealing market share at businessoffashion.com. This and other stories are available to BOF professional subscribers only, and you can find the link in the episode notes. You've been listening to The Debrief, produced and edited by Olivia Davies and Angel Nemov. I'm Sheena Butler-Young. We'll be back next week with a new episode. Thanks so much for joining us, and be sure to follow us wherever you get your podcasts.

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