To Tall Ships, Small Ships, and Flagships

Lululemon’s turning the Windy City into a fitness mecca with its new flagship, which officially opened yesterday. And the new destination has more to offer than ABC pants.

Inside Lulupalooza

The 20,000 square-foot, two-story location is Lululemon’s largest store yet. Now that the doors are open, chaturanga pros in Chicago’s Lincoln Park neighborhood can...

• Take fitness classes in its multiple on-site studios
• Snack on smoothies and green fare at its Fuel café
• Test select gear during those classes before buying it

Lululemon’s opening shouldn't come as a surprise. To stay on track with its projection of $4 billion in total sales by 2020, Lululemon’s said that it’s investing heavily in community-driven properties (aka the Chicago flagship).

• Physical stores accounted for about 65% of revenue at the end of last year...so fusing a new property with on-site activations adds up.

Everyone wants space

The same buzzwords behind Lululemon’s Chicago bet (like “experience” and “community”) are driving similar flagship strategies across the board. This year...

• Neiman Marcus opened a flagship at NYC’s Hudson Yards
• Microsoft (this week) opened a London flagship
• Nordstrom announced plans for an NYC women’s flagship

Why? Flagships help make fuzzy brand values more tangible through site-specific activations. Try as it might, e-comm can’t replicate that.

• But they don’t always draw crowds. Just look at NYC’s ill-fated Saks Downtown, which closed just over two years after it opened.

Looking ahead…Lululemon’s operating like its shrine to stretchy fabrics is already a winner. By 2023, about 10% of its store fleet will be upgraded to include experiential features that debuted in Chicago.