Lululemon Athletica Inc. can leverage the opportunities offered by social media marketing to improve business performance. Natural disasters in South East Asia and South Asia especially a concern because 82% of the Lululemon products come from manufacturing in these regions (Lululemon, 2017). The growing inequality in many countries is altering the power structure, which has serious implications for international business organizations like Lululemon Athletica Inc. Lululemon Athletica Inc. need to study the traditionally assigned gender roles to align its marketing and communication practices accordingly. This was due to a desire to work with leading fabric suppliers and increased investments. In some countries, recycling has almost become a business norm. Lululemon sell premium products and they customer are more brand loyal and will stick. Check your email Published: 2nd Nov 2020. Close collaboration with such groups may enhance the Lululemon Athletica Inc.s ability to collaborate with community and achieve long-term corporate goals. (2017). Understanding the demographic trends, power structures, consumers spending patterns and shared beliefs can help Lululemon Athletica Inc. design effective marketing messages and fulfil corporate objectives through informed PESTEL analysis. Analyzing the companys financial statement helps in evaluating performance of the company that further helps in making smart decisions. Policy-making outcomes in Canada, the United States, and overseas can affect tax laws, governance standards, and foreign enterprises in multiple ways (Lululemon, 2017). Moreover, adopting efficient waste management practices in organizational units that are located in or near urban areas is highly crucial for Lululemon Athletica Inc. This article is only an example The economic and regulatory environment in a monopolistic or oligopolistic structure will be different from the monopolistic competition and perfect competition. Use of social media has become common in a modern business environment. Lululemon Athletica Inc. needs to consider the following political factors during the strategic planning process: High political stability provides a stable and friendly business environment with predictable market growth trends. There is a growing trend towards the use of green/eco-friendly products. The health and efficiency of financial markets will determine Lululemon Athletica Inc.s ability to raise the capital at fair prices. Like all businesses they are sensitive to economic situation on global and local markets. Rate the supplier power forces (High, Medium, or Low). Bureaucracy and corruption negatively influence the business environment. so there is a big opportunities for converse from these companies. A strategic framework for technology evaluation. - Empowerment of Supply Chain Partners Lululemon Athletica should analyze areas where technology can empower supply chain partners. Should nations where Lululemon operates enact disadvantageous tariffs, embargoes, or trade restrictions, the models Lululemon depended on for its expansion strategy could become obsolete (Lululemon, 2017). WebPestel Analysis OF Lululemon Athletica Case Study Help Political factors: The reality that Pestel Analysis of Lululemon Athletica has actually expanded its services in different The gender composition of labor market is a good indicator of disposal income of household, priorities of the households, and related needs. This is due to brand loyalty that each brand possesses by each luxury group. The organization should also carefully consider the interest rate and its influence on borrowing ability and attitude towards investment. - Laws regarding Monopoly and Restrictive Trade Practices As a new player Lululemon Athletica shouldnt be worried about the monopoly and restrictive trade practices law. Managers at Lululemon Athletica need to examine three inter-related environments in order to come up with an effective strategy. Slow speed will give more time while fast speed of technological disruption may give a firm little time to cope and be profitable. University of San Carlos - Main Campus. - Societal Norms and Hierarchy What sort of hierarchy and norms are acceptable in society also influence the types and level of consumption in a society. Moreover, there are laws to set the maximum price, ensure a certain quality standard and protect consumers from fraudulent marketing claims. Similarly, anti-discrimination laws (like equal employment opportunity) also need to be carefully studied when developing human resource practices as discriminatory suits against employer harm the organizational image and affect organizations ability to attract and retain the talent. They are just awesome. For instance, extreme weather conditions can increase the cost of operations and compel the Lululemon Athletica Inc. to make the value chain more flexible. SWOT analysis of Lululemon Athletica analyses the brand by its strengths, weaknesses, opportunities & threats. - Government Spending As mentioned in the political factors, government of the country is running deficit budgets. According to Michael Porter organizational performance is to large extend determined by various industry forces. Regulatory bodies emphasis on ensuring compliance with environmental norms is altering the product innovation priorities. so converse have to change their policy to stable in the current market. It can lead to uncertainty and suppression of consumption in both short term and long term. Technology is fast disrupting business models across various industries. please submit your details here. Leyva, M., Hechavarria, J., Batista, N., Alarcon, J. Government intervention in the free market and related Consumer Goods. As such the impact of the external business environment factors on Huaweis marketing strategy are explained by the PESTEL Model as follows: PESTLE analysis Analyze the Lululemon Athletica external competitive environment to identify opportunities and threats. Supply chain risk management framework: A fishbone analysis approach. Lululemon Athletica should be aware of presence of such practices in a country. Economic factors of a country and region have a direct impact on the potential attractiveness of a given market. Some of the economic factors that Lululemon Lululemon's should evaluate both in the present market and one in which it wants to enter are inflation rate, GDP growth rate, disposable income level etc. Also, to accurately analyze the performance of the company, we need to compare its performance. Attitudes (health, environmental consciousness, etc. Lululemon Athletica Inc. must study the specific environmental regulations of the country under consideration to understand which resources (like water, electricity etc.) - Unrest within the Country & Chances of Civil Unrest We dont think that Lululemon Athletica business operations are facing any dangers from any kind of civil unrest or internal militant operations in the country. - Nature of Social Contract between Government & Society Before entering into a market Lululemon Athletica needs to understand the nature of social contract between government and society. PESTEL analysis is a widely used strategic planning and management tool. Infrastructure quality in Textile - Apparel Clothing industry. MarketLine. It requires Lululemon Athletica Inc. to prioritize and focus on marketing the eco-friendly nature of their products over customary value propositions. Number of factories increased throughout the nation, it became one of the leading industrial nations in the world. Fern Fort University. - Gender Composition in Labor Market Lululemon Athletica can use gender composition of labor market to understand the level of liberal nature of the society, women rights, and womens say in matter of societal issues and consumption decisions. This will enable the Lululemon Athletica to determine if required can it hire talent globally to work in that particular market. However, they should try to understand the changes in the external environment and assess the impact of those changes on the target market. This can help Lululemon Athletica to bring in more transparency and make supply chain more flexible. Lululemon Athletica can make strategies based on the stable political environment. Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. Labor costs and productivity in the economy, Business cycle stage (e.g. Company profile: Lululemon Athletica, Inc. Nam, C., Dong, H., & Lee, Y.-A. We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. Amazing Business Data Maps. In fact, a proper understanding of these factors helps organizations to identify potential business opportunities and threats in the international market (Baines et al., 2011). 1. - Adherence to Common Law Is the country following common law which is uniform for all parties whether domestic or international. Efficiency of financial markets Does Lululemon Athletica Inc. needs to raise capital in local market? WebThe Lululemon athletica in 2005 PESTEL Analysis will look at the external factors political, economic, social, technological, environmental, and legal. It is sensitive to business law regulation in different countries, and they tax regulation. - Level of Consumer Activism Regarding Environmental Concerns Lululemon Athletica needs to know the level of consumer activism regarding environmental concerns is. 24-27). Canadian government introducing Workplace Fitness Program Policy, and many other countries that Lululemon operate have also such policies. The business and marketing strategies are also influenced by migration. When labor markets are flexible, Lululemon Athletica Inc. can take advantage of higher labor productivity. Whereas, operating in rigid labor markets may cause labor wage and other issues raised by powerful labor unions. Each society has distinctive norms and values that play an important role in shaping consumer behavior. Lululemon is fast growing company that open stores or franchise in market such as America, Japan, Australia and Europe. that shape strategy and competitive landscape. Business models outside the core: Lessons learned from success and failure. The use of foreign labour and manufacturing resources among multinational enterprises can become complicated, where firms that violate principles of corporate social responsibility experience backlash from consumers often (Nam et al., 2017). Porter Five Forces Buy Professional PPT templates to impress your boss. Nike PESTLE Analysis.pdf. - Consumer Disposable Income The household income of the country has increased constantly in the last decade and half, compare to the USA market where household income is still below 2007 levels and not increased in real terms since early 1980s. It is important to note that the Lululemon athletica in 2005 PESTEL Analysis will be market specific, and the implications of the factors change for a company when the market changes. Lululemon Athletica Inc. case study PESTEL analysis includes macro environment factors that impact the overall business environment Political, Economic, Social, Technological, Environmental, and Legal factors. - Role Local Governments Play Local governments are highly influential in the policy making process and implementation as most of the policies and regulations are implemented by the local government as enforcement agencies mostly report to local government in their own states regarding various laws. - Immigration Policies and Level of Immigration What are the immigration policies of the country, what is the level of immigration, and in which sectors immigration is encouraged. 2. Shared beliefs and attitudes of the population play a great role in how marketers at Lululemon Athletica Inc. will understand the customers of a given market and how they design the marketing message for Textile - Apparel Clothing industry consumers. But the business was later expropriated by the Left Wing government. Thus significantly impacting the ability of Lululemon Athletica to build sustainable competitive advantage Entering in countries with high taxation level will directly influence the profitability of Lululemon Athletica Inc. High taxation affects international trade and prevents exports. Lululemon Athletica Inc. need to study data protection regulations to protect the customer data. Lululemon Athletica can leverage such a situation to hire the best people in business. 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