Will Lululemon Digital Sales be Enough?

In the last 2 quarters, Lululemon's digital sales have rocketed: +155% in Q2 and +94% in Q3.

You can see a massive surge in digital fulfillment mentions from March through August on the chart above. Then, a strong Holiday season. Currently, Lululemon digital fulfillment mentions are pacing +32% YoY. This shows some behavior stickiness, and it's important for Lululemon to maintain this momentum moving forward. From February through early November, in-store revenue fell 36% YoY, and digital sales comprised 43% of total sales...so strength in this segment is critical to drive growth and offset lower foot traffic. We've also got our eyes on 2 other key indicators of future growth: 1) Lululemon began selling home fitness device, Mirror, ahead of the Holiday season. Lulu acquired Mirror in June for $500 million. LikeFolio data shows that while the sample size is low, buzz is growing. Mentions of the Mirror device/platform have increased 19% YoY, and recorded a nice peak during a key fitness season: New Year Resolutions. 2) The high quality athleisure market is getting crowded. LikeFolio data suggests some other players in the athleisure space are gaining traction with consumers. While Lululemon continues to hold market share from total demand perspective (represented by the size of the circle on the chart below) -- three other brands are showing signs of steal.

Vuori has exploded on the consumer scene with a price tag just under that of Lululemon. Gymshark (eCommerce only) and Gap's Athleta brand are also showing signs of YoY growth. This is something to keep an eye on moving forward, especially as we watch overall demand growth for Lululemon temper.