I think athleisure is rolling over for fall and its growth rate will dramatically slow, and then stall out.
Let’s take a look at current market darling Lululemon. Admittedly, Lulu has great technical product for yoga. And, it makes pretty good product for other serious athletes. It tries to make great products for male athletes as well. And, actually, it does, but most guys don’t care. The label does not say manly Under Armour, Nike or even Champion.
Lulu also makes ABC casual pants for men, and they are also a pretty good product, if you happen to ride your bike to work, or maybe Segway or skateboard to work. The reality is that the intersection for wearability on that Venn diagram is pretty limited. Most men who have a pair of ABC pants got them as a gift from a wife or girlfriend for a birthday or Father’s Day. If it sounds like I am skeptical about Lulu hitting its targets on penetrating the men’s market, I am. Realistically, I think it is much easier to cash in on a great men’s brand by selling it to women than it is to cash in on great women’s brand by selling it to men.
And, bottom line, I do not think that Lulu is as great a women’s brand as it once was.
On a Roll Over
CEO, Laurent Potdevin, of Lulu admitted in an interview with CNBC that athleisure would roll over, but Lulu would not be affected. If he really believes that, I have a bridge in Brooklyn I’d like to talk to him about.
During the interview, Laurent was correct in stating that Lulu is a technical product producer, but he neglected to mention that Lulu actually started the athleisure craze. And it was a craze. I personally know women who wore Lulu product every day, everywhere for over three years. And I suspect, you do, too. If I am right predicting that we are no longer going to see that same dedication to wearing active wear everywhere, women are going to need substantially fewer new Lulu products in the future.
Athleisure is rolling over. Yes, really. The chart shows that the sports apparel category went negative last year. Although that does not prove athleisure is rolling over, I predict it will.
Most fashion trends do not last 10 years. Although that rule that does not prove that athleisure is coming to an end because technically it has been around for a decade. I am hearing people on the streets say that athleisure is the new normal, perhaps the best indicator any trend has peaked, is starting to plateau, then lose ground.
In the last few months I have traveled around the country from Texas and the Southwest to the Midwest and the Northeast on site visits to malls, off price, and discount stores. I conducted my own market research on what the cool people, the regular people and the really not cool people are wearing. I talked to store managers about what they are seeing from their customers. I also talked to buyers about what they bought for spring, what they still have in inventory, and what they are buying for the back half.
In Austin, the hordes of people on the riverside running trail were wearing Nike, and Under Armour … and, yes, Lulu. Since that was my first stop in Austin, I thought, “Uh-oh, this town is not going to provide any evidence supporting my case.” But later I spent four hours, on a Saturday morning, in the cool part of Austin. From Starbucks, to a Black and Gold bar, to quaint breakfast places, salons, and art galleries, there was not one woman in athleisure gear to be found. Not one in four hours of searching in the coolest part of a cool town. Only a few blocks away, hundreds of people were running in workout gear, but during a casual part of the day, there was no athleisure as street wear to be seen. Athleisure is rolling over.
During a four-hour visit to a Midwestern mall, I ran into one woman in athleisure, and she was as old as I am. In another three-hour visit to another Midwestern mall I ran into only four women in athleisure, two of whom fell into the “cool girl” category. Athleisure is rolling over.
I have also traveled around Europe in the last few months, and the lack of athleisure product being worn is noteworthy. While I was there, the Brits as a group were Brexiting. The same is true for althleisure. It is being exited.
Proving the Theory
My conversations with sportswear buyers indicated that they had bought for less growth in athleisure for spring, and that they were buying for no growth for fall. Does my small sample (certainly not statistically significant) prove that athleisure is rolling over? No, but it is an interesting anecdotal supporting data point. What did those buyers buy instead? Mostly denim, both straight legs and flares. With confidence? No. But, they didn’t buy athleisure.
This is all anecdotal, and, yes, I have been out intentionally looking for evidence supporting my thesis. You might be able to go out and find just as much data to support the opposite thesis that athleisure will roll on forever.
The difference is that I am going to be right, and you are going to be wrong.
A Different Future for Athleisure
So who benefits and who gets hurt? I don’t think that this is a big deal for Nike or Under Armour. Athleisure rolling over is a “girl” problem, not a “guy” problem. There is no evidence of a reduction in the interest guys or girls have in working out. It is the interest among women in wearing workout style gear on the streets that is rolling over. As a side note, nothing I’ve said means that I think that UA going into Kohl’s is good for the UA brand. It is great for Kohl’s, bad for the UA brand.
If this change in the athleisure trend is real and not just my prediction, it will be good for footwear that goes with denim, both flares and straight legs. It will be good for fashion handbags, especially Coach and Kate, which are increasingly catching the attention of the consumer. The new trend will also be good for more traditional manufacturers of sportswear like Ralph Lauren and PVH, and probably VF. Women are going to need a whole new portfolio of accessories appropriate for non-athleisure style.
It won’t be good for Lulu, and it probably will not be good for the growth engine at Victoria’s Secret, VSX. And it is probably a bit of a negative for Pink, as well. It will not be good for Athleta or Gap Body. I do not think it’s positive for Aerie, either.
It will also be a bit jarring for the private label efforts at Penney (Xersion), Kohl’s (SO), and Nordstrom (Zella). Macy’s has depended more on brands than private label in its athleisure gear. It may also be a bit of an issue for product pack-aways in the off-price space.
To be fair, I have been seeing arguments both ways on the athleisure trend. Up to now, all of the arguments were one way in favor of athleisure. But, mark my words, I predict this trend is entering the death throes of the uncool.