A Conversation with Chip Wilson, Founder of lululemon athletica

A Conversation with Chip Wilson, Founder of lululemon athletica

With an estimated value of over $1.7 trillion (larger than the entire economy of Canada, Russia or Italy), the global fashion market is competitive, innovative, dynamic and deeply connected to human culture.  This latter point is intrinsic.  The most successful businesses in fashion are those who have connected-the-dots, seeing the micro and macro trends that shift the sands, creating new segments for, and methods of, doing business.  It is no surprise therefore, that some of the wealthiest individuals in the world, and some of the largest businesses on the planet, are in fashion & apparel.

Chip Wilson is the entrepreneur & philanthropist who is widely credited with the creation of ‘athleisure’ as a retail category (now worth over $400-billion globally).  He is perhaps best known for being the founder of luluemon, the yoga-inspired technical athletic apparel company he started in 1998 which- today- has over 15,000 employees and a market capitalisation of close to $30billion.

In this exclusive interview, I spoke with Chip about the lululemon journey, building powerful brands, investing, and what it takes to be an innovative fashion entrepreneur. 

Q:  How do you spot consumer trends early?

[Chip Wilson]:  When I was 19, I had a job- holding a torch to a piece of pipe in Alaska, to make sure it didn’t freeze.  I had to do that for basically 16-17 hours a day- it paid me a lot of money, but it was extremely boring.  I hadn’t been much of a reader before then, but I became one- I read the top 100 books of all time, and just started soaking up all this information.  I then started doing the same with newspapers, reading 3 a day… I noticed I started to get ideas… and having this knowledge allowed me to piece things together and see patterns, trends… All that learning was key to being able to have the confidence to see whether an idea would actually happen.

My fun statement is that if I see the same thing, three times in one week, from disparate news or information sources, I have to move quickly as it’s a trend that’s likely to happen.

Q:  Why have we seen such explosive growth in the health and beauty sector?

[Chip Wilson]:  If you look at the world after WWII and how people lived- there were maybe some pockets of people in the world who lived to be a very old-age, but we didn’t have that broad understanding and science base to see that there are certain things we can all do to live longer.

Our number one instinct is survival, followed by reproduction.  People started to realise that if they took care of themselves, they would live longer, have better sex and have healthier children.  The mission of my family, which ended up being Lululemon, was for people to be able to live healthier, longer, and more fun lives.  Our designers used that mission as their basis- the result being high quality clothing, which had to last a long time.  Beauty for us is an off-shoot of health- you work out, you sweat, you release endorphins, you eat right… beauty emanates from that.  In todays market we have luxury fashion, the fakery Instagram, and then athletic brands who are about authenticity, what it takes to be an athlete, and to be strong and healthy.

Q: How did you achieve such deep consumer loyalty and engagement?

[Chip Wilson]: I started from a position of giving, without expectation of return.  I also decided that I only wanted to work with people who I loved to work with.  I wanted to train them, give them the ability to be the best they could be in life… Once we decided yoga was going to be our path- the thought process is then about how we build customers, how we have employees who are the same as our customers… have the same socio-economic status as our customers… And that was actually quite novel! Before we came to market, everything in retail was about how cheaply you could pay your employees- and unfortunately, particularly women.  There was an attitude in retail that said, ‘… well, your female employees are just going to get married, have children at 23 and leave, so why invest in them?’ The reality of the world was that 60% of university graduates were women- and most women were having children later, entering professional careers, and so you had this huge market of women, 23-32 years old, who were highly paid, highly educated professional consumers.  I wanted those people in my business, I wanted to pay them what they deserved, and train them as hard as I could to be the very best they could be, to work with sophisticated, wealthy customers.  This was a very new business model- we took a technical product, made it beautiful, and took it directly to the customer with highly-paid, sophisticated customer service.                                                                                               

Q:  How do you develop engaging retail experiences?

[Chip Wilson]:  The high street is expensive.  Before Lululemon, the model was to do massive amounts of advertising, fashion shows, and run a lot of loss leaders to sell high-margin leather purses which you make for $10 and sell for $5,000.  I knew our customer was there, on those high streets, and I wanted to give them a high quality, high touch product… something they could buy every 2 months.

One of our really powerful strategies was our in-store experience, and our yoga classes.  Don’t forget, we were supplying education about a technical product; it wasn’t’ about a sales-experience, or someone telling you that you look pretty.   We wanted people to understand the technical element.  When we started the business, we were poor, had no branding, and had no money- the only way we could get people into store was to put everything on rollers, and move it to the side, so we could have yoga classes in the middle of the store- a lot of inventions come from the mother of necessity!  We recognised quickly that not only did we have those original yoga consumers in the community, but the new consumers too- the most beautiful, fit, healthy women in our communities had started taking-up yoga, and suddenly they were all wearing Lululemon clothing.

Those things together helped make the whole thing successful.

Q:  How did you balance a brand built on health and appearance with the emergence of a deeply ‘PC’ workplace?

[Chip Wilson]:  There’s a great quote that is ‘political correctness is tyranny with manners’.

With Lululemon, we put authenticity into everything we did, it was about being great.  Our vision statement was about elevating the world from a place of mediocrity to greatness.  Mission statements and vision statements are useful- but the strength of our company was built on two things.  Firstly; we had 5 books or courses which everyone took in the first 2-3 weeks they were with the company.  Out of this, we created a linguistic abstraction of 30 terms and definitions which became the culture of the company.  That allowed us to expand exponentially, because suddenly everyone was speaking the same language.  Secondly; from a culture-perspective I remember one day where- in just 30 minutes- I wrote down everything I believed in, and who I was.  A lot of this came from my father, one of the original hippies who hung out in San Francisco, looked for the meaning of life… he was into mindfulness, meditation, gestalt therapy, all those kinds of things.  He quit teaching to become an assistant gardener!  The output of that 30 minutes actually became the statements that were on the side of our shopping bags for a long time.  If you look at Lululemon shopping bags today; they have some parts of it, but it looks more like artwork- perhaps because the company is too embarrassed to say it like it is.  For example, it would say things like ‘stop wearing sunscreen, just get the right amount of sun…’ why? Because sun-lotion is full of chemicals that are worse for you than the sun! …of course, the sunscreen lobby would come back, get all their social media people to make sure Lululemon looks bad… and the company would get scared….

These original statements on the side of the bag ended up being a key part of driving our culture to people around the world, and formed the basis of what Lululemon stood for.  When people came to work for us, 70% of them said that they’d chosen Lululemon because of what they’d read not he side of our shopping bags!

Q:  What drives you as an entrepreneur?

[Chip Wilson]:  I might get an idea that just grates on me – and it makes me wonder whether the world- in general- agrees with what I think the future of the world will be.

My business vision now is to elevate the lives of 20-30 year old people through transformational developments in the technical apparel space.  The learnings I took from surf, skate and snowboarding… then yoga… I’ve now brought into multi-brand concepts with Chinese partners.  Chine is the future- but also there are lots of authentic, technical, outdoor companies who are really male-driven engineering companies who don’t understand customers or retail.  Now, I have the opportunity to take my learnings from surf, skate, snowboard and yoga – and apply them into technology driven everyday apparel – it’s exciting, and fires me up every morning.

[bios]Chip Wilson is an entrepreneur, philanthropist, loving husband and a father to 5 boys. As the founder of Westbeach Snowboard and lululemon athletica, Chip is a globally recognized innovator in the field of technical apparel. He is widely credited with creating the “athleisure” retail category, now a $400-billion-a year global business.

Chip is known for his people-before-product leadership approach. At lululemon, he created a unique culture by surrounding himself with like-minded individuals; creative, driven, athletic locals enjoying a work-life balance inspired by the West Coast. In 2007, lululemon athletica went public.  Today they have a market cap of roughly $30 billion.

Today, Chip is actively involved in Hold It All Inc. (HIA), a multifaceted organization that houses the Wilson family interests that each hold true to the Wilson family’s vision of “providing components for people to live longer, healthier, more fun lives”.

In 2018, Chip released his business memoir, ‘Little Black Stretchy Pants, the Story of lululemon by the Founder: Chip Wilson’ to provide context for building a cultural company.

In 2019, the Wilson family partnered with Anta Sports, Fountainvest and Tencent to buy Amer Sports (NASDAQ OMX: AMEAS), a sporting goods company which includes internationally recognized brands including Salomon, Arc’teryx, Peak Performance, Atomic, Suunto, Wilson Sports and Precor.  Amer products are ‘designed to improve the performance athletes, help them achieve their goals, and provide them with more enjoyment from their activity of choice.’

Chip currently sits on the board of Facio Therapies, a Netherlands-based company founded by families affected by Facioscapulohumeral Muscular Dystrophy (FSHD) with the intention of finding a cure; Helsinki-based Amer Sports; and Low Tide Properties, a Wilson family company based in Vancouver, BC.  Chip is also an advisor to Anta Sports Products Ltd. out of China.

The Wilson Family Foundation is passionate about developing open, everlasting, beautiful parks to encourage movement. Through their Foundation, they have supported local art and design initiatives such as the Wilson School of Design at Kwantlen Polytechnic University (KPU) and the Wilson Arts Plaza at Emily Carr University. Together, they also founded imagine1day to “provide all children in Ethiopia with a quality education free of foreign aid by 2030” which went on to merge with the WE Charity in 2017. [/bios]

Thought Economics

About the Author

Vikas Shah MBE DL is an entrepreneur, investor & philanthropist. He is CEO of Swiscot Group alongside being a venture-investor in a number of businesses internationally. He is a Non-Executive Board Member of the UK Government’s Department for Business, Energy & Industrial Strategy and a Non-Executive Director of the Solicitors Regulation Authority. Vikas was awarded an MBE for Services to Business and the Economy in Her Majesty the Queen’s 2018 New Year’s Honours List and in 2021 became a Deputy Lieutenant of the Greater Manchester Lieutenancy. He is an Honorary Professor of Business at The Alliance Business School, University of Manchester and Visiting Professors at the MIT Sloan Lisbon MBA.

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