Lululemon’s “Woke” Class: when ESG efforts go terribly wrong
Author: Samantha Murray | UC Berkeley School of Law | J.D. Candidate 2021 | Posted: November 23, 2020
For those unfamiliar with internet meme lexicon, Dictionary.com defines the phrase “this ain’t it, chief” as “a humorous social media phrase used to signal that someone thinks someone else’s statement is utterly wrong or idiotic.” [1] Urban Dictionary is less forgiving, offering this alternative definition: “something an individual would deem widely accepted or cool to show off, but in reality it just makes them look like a f***ing idiot.”[2] Regardless of the definition you prefer, the phrase can be aptly applied to Lululemon’s recent gaff: hosting an online “Decolonizing Gender” workshop that promises to help attendees “unveil historical erasure and resist capitalism.” [3] The irony of a company valued at $45 billion imploring its customers to resist capitalism while continuing to sell $150 leggings was not lost on the people of Twitter. [4] But was the massive backlash a foregone conclusion?
It’s not as if other companies haven’t tried to do the same thing. The most famous example is Patagonia’s 2011 “Don’t Buy This Jacket” Black Friday ad campaign, but the trend lives on in marketing strategies like Uber’s recent “If you tolerate racism, delete Uber” directive. [5] Of these three ESG strategies, Patagonia’s was widely heralded as a success, Uber’s has accrued a tepid response at best, and Lululemon’s has devolved into an absolute disaster. What accounts for this disparity in responses?
While it’s tough to know for sure, I’ll hazard a few guesses. First, there is something to be said for leading a charge versus jumping on the bandwagon. Patagonia’s Black Friday ad was the first of its kind and Patagonia executives offered a compelling rationale as to how the campaign tied into their company’s ethos. The company argued that Patagonia products were of such a high quality that one jacket should last the customer for several years, thus eliminating the need for replacements and benefiting the environment. [6] There was also a perception (which turned out to be incorrect) [7] that the company would lose money by running this type of campaign, but that it was willing to sacrifice potential profits for the cause. Lululemon does not have a similar story to tell. Rather, the company has consistently been in hot water. Its former CEO made several derogatory remarks about plus-sized women as well as a host of other inappropriate comments (enough to prompt Business Insider to develop a handy ‘worst of’ list[8]). The company also faced multiple sexual harassment lawsuits at the height of the #MeToo movement in 2017. One lawsuit, in which the plaintiff sought damages totaling over $3 million, described Lululemon as “the perfect environment for a sexual predator.”[9] After all of this came to light, one of Lululemon’s shareholders actually sued the board of directors, alleging that allowing the corporate culture to become so toxic amounted to breach of fiduciary duty. [10] This history, in combination with recent trends toward corporate branding around social issues, makes Lululemon’s ‘Decolonizing Gender’ workshop feel less authentic. [11]
This leads us to my second point: once a company acquires a bad reputation, it is exceedingly difficult to win back public opinion. The persistence of a bad public image, even after a company takes decisive action to combat its problems, is a recurring gripe among the many in-house lawyers who speak to our class. Like Uber, Lululemon replaced its problematic CEO and affirmed its commitment to overhauling company culture. But many consumers don’t seem to notice or care. While Uber’s attempt to take control of the original 2017 ‘Delete Uber’ hashtag by turning it into an ESG marketing campaign feels insincere but inoffensive, Lululemon’s ‘Decolonize Gender and Resist Capitalism’ workshop struck a collective nerve.
Third, and finally, Lululemon’s workshop may have bombed in part because the company has done so well during the pandemic. [12] Of course, this isn’t really Lululemon’s fault, (Who could have predicted worldwide skyrocketing demand for sweatpants?!) but their success comes at a time when many people, especially Americans, are really struggling. In times of hardship, many customers are watching to see what (if anything) companies are doing to help their stakeholders. These efforts can take many forms, and often vary to meet the moment. [13] Lululemon’s free video yoga classes, [14] which present a stronger tie to their products and offer a much-needed wellness activity, do a better job at addressing customer needs. But an anti-capitalism workshop led by one of the company’s brand ambassadors just doesn’t sit the same way.
On the bright side, in an age where American society is more polarized than ever before, social justice advocates and their conservative “get woke and go broke” counterparts may have finally found something they can agree on: this Lululemon online workshop has turned out to be, to borrow an older piece of internet slang, an epic fail.
[1] Dictionary.com, https://www.dictionary.com/e/slang/this-aint-it-chief/?itm_source=parsely-api (last visited Sept. 24, 2020).
[2] Urbandictionary.com, https://www.urbandictionary.com/define.php?term=this%20ain%E2%80%99t%20it%20chief (last visited Sept. 24, 2020).
[3] James Gordon, ‘This is peak 2020’: Multi-billion dollar sportswear company Lululemon is ridiculed for promoting a ‘woke’ class on ‘resisting capitalism’ while selling its signature yoga pants for $128, The Daily Mail, https://www.dailymail.co.uk/news/article-8720815/Lululemon-fire-holding-class-resisting-capitalism-selling-yoga-pants-128.html (last visited Sept. 24, 2020).
[4] (The company’s original Twitter post has since been deleted). Edward Helmore, Billion-dollar Lululemon under fire for promoting ‘resist capitalism’ event, The Guardian, https://www.theguardian.com/business/2020/sep/11/lululemon-athletic-wear-resist-capitalism (last visited Sept. 24, 2020).
[5] Patagonia, Don’t Buy This Jacket, Black Friday, and the New York Times, https://www.patagonia.com/stories/dont-buy-this-jacket-black-friday-and-the-new-york-times/story-18615.html (last visited Sept. 24, 2020). Ilyse Liffreing, Uber to racists: delete Uber. AdAge. https://adage.com/creativity/work/uber-racists-delete-uber/2277281 (last visited Sept. 24, 2020).
[6] Patagonia, Don’t Buy This Jacket, Black Friday, and the New York Times, https://www.patagonia.com/stories/dont-buy-this-jacket-black-friday-and-the-new-york-times/story-18615.html (last visited Sept. 24, 2020).
[7] Jeff Rosenblum, How Patagonia Makes More Money by Trying to Make Less, Fast Company, https://www.fastcompany.com/1681023/how-patagonia-makes-more-money-by-trying-to-make-less (last visited Sept. 24, 2020).
[8] Hayley Peterson, 8 Outrageous Remarks by Lulemon’s Founder, Chip Wilson, Business Insider, https://www.businessinsider.com/outrageous-remarks-by-lululemon-founder-chip-wilson-2013-12 (last visted Sept. 24, 2020).
[9]Leticia Miranda, A New Lawsuit Alleges Lululemon Knowingly Let A Serial Harasser Work At Its Stores, BuzzFeed News, https://www.buzzfeednews.com/article/leticiamiranda/a-new-lawsuit-alleges-lululemon-let-a-serial-harasser-work (last visited Oct. 23, 2020).
[10] The Fashion Law, Lululemon’s Board of Directors Accused of Ignoring “Toxic” Behavior of Ex-CEO, https://www.thefashionlaw.com/lululemons-board-of-directors-accused-of-ignoring-toxic-behavior-of-ex-ceo/ (last visited Oct. 23, 2020).
[11] This phenomenon is sometimes referred to by activists as pink-washing. See Stephan Dahl, The curse of pride marketing and the rise of ‘pink washing’, The Conversation, https://theconversation.com/the-rise-of-pride-marketing-and-the-curse-of-pink-washing-30925 (last visted Sept. 24, 2020)
[12] Bloomberg and Janet Freund, Lululemon shares hit an all-time high on strength of ‘work at home wear’, Fortune, https://fortune.com/2020/05/21/lululemon-stock-lulu-shares-all-time-high-coronavirus-work-at-home-clothing-athleisure-2020-covid-19/ (last visited Sept. 24, 2020). Note that profits eventually dropped after this initial spike in sales.
[13] For example, my former employer, AB InBev, uses its breweries to produce cans of water for shelters residents during hurricane season, and excess alcohol (a natural byproduct in the beer fermentation process) became hand sanitizer for local hospitals during COVID-19. See, Anheuser-Busch, About Our Commitment to Donating Emergency Drinking Water, https://www.anheuser-busch.com/community/disaster-relief.html (last visited Sept. 24, 2020); AB InBev, AB InBev is manufacturing over 1 million bottles of hand sanitizer to distribute to hospitals and frontline workers around the world, Our Stories, https://www.ab-inbev.com/news-media/news-stories/ab-inbev-is-manufacturing-over-1-million-bottles-of-hand-sanitizer-to-donate-to-hospitals-and-frontline.html (last visited Sept. 24, 2020).
[14] Lululemon, https://shop.lululemon.com/stories/vinyasa-yoga-video?icid=story-story%3Ayoga-videos;1;13masonry;stories%3Avinyasa-yoga;;weeklies (last visited Sept. 24, 2020).