Lululemon takes passage to India for tech talent

Athletic-apparel retailer Lululemon Athletica styles itself as lululemon athletica. Headquartered in Vancouver, Canada, it has 521 company-operated stores in 17 countries—315 of these are in the US, and 62 in Canada.

Unsurprisingly, North America contributes more than 85 percent of lululemon athletica's revenue of $4.4 billion in 2020.

But in early 2020, the COVID-19 pandemic posed a number of hard questions for the retailer, as its management reinforced the 'Power of Three' strategy in the backdrop of several lockdowns. Keeping stores shut was the primary reason for a 34 percent dip in lululemon athletica's in-store revenue.

Lululemon Athletica's Power of Three strategy focuses on product innovation, omni-guest experiences, and international expansion.

"Each of these goals is heavily reliant on technology," notes Julie Averill, Executive Vice President and CTO, Lululemon Athletica. "As we saw a consumer shift and employees start to work from home, technology had to change with this."

On the product-innovation front, lululemon athletica acted on opening its India Tech Hub in Bengaluru, earlier this month. It has employed 70 people, and aims to grow the team to 250 before 2023.

The company appointed Vaidyanathan Seshan, Vice President - Information Technology, as Head of its India Tech Hub. Seshan has been with the company in Seattle since February 2018. He and Praveen Mysore, Senior Director of lululemon athletica in Vancouver, have moved to India to grow the team here.

Its technology organisation is 1,500-people strong, and the company has around 25,000 employees globally.

Lululemon Athletica also acquired in-home fitness company MIRROR for $500 million in June 2020. Founded in 2018, MIRROR hosts weekly live classes, on-demand workouts, as well as immersive one-on-one personal training.

"The acquisition gives us tremendous potential to connect more content, more classes, and more guests," Averill says. One thing was evident: it wants to expand in direct-to-customer (D2C), and expand its omni-guest experiences.

"We realised we have to shore up our technology organisation," Averill says. "We began investing in technology and leadership." And, the company wants to decentralise the technology buildout.

"We are figuring out how to be both omni-channel and locally relevant," she says. "Areas like payments are different by geography, as are the services we offer." Lululemon Athletica doubled its D2C business, clocking $2.3 billion in 2020. It now accounts for nearly 52 percent of net revenue.

"Architecturally, we don’t develop anything just for one channel," Seshan points out. "We always look at technology from the lens of multi-channel and global. Our foundation architecture is designed for that."

During the pandemic, this meant build out locally-relevant technologies across markets. "The experiences may differ by country. But, we continue to innovate to serve our guests where they are, and how they want us to show up for them," Averill says, citing its products that have enabled lululemon to be present for customers to buy online, order online and pick up at the kerbside or even at its stores.

Its international expansion entailed 18 stores in the Asia-Pacific region and three in Europe. This spurred its international markets' growth by 31 percent, compared to North America's 8 percent in 2020.

"Our growth is coming from Asia, and India is in the time zone of APAC," Seshan says. "So, there is China as well as Europe. And we can serve the rest of the world for growth from the India Tech Hub."

The other aspect about lululemon athletica is its supply chain: 33 percent of its products are manufactured in Vietnam, 20 percent in Cambodia, 12 percent in Sri Lanka, and 9 percent in China.

"As a vertical-focused retailer, we make our own products," Seshan adds. "So, we have data end to end—from the factory to assortment of merchandise at stores, and are fortunate to work with this huge amount of data."

Little wonder, the India Tech Hub has begun with a focus on areas like artificial intelligence, data sciences, and product development for its lululemon athletica's global markets.