Mirror, Mirror, on the Wall
Remember the days when we didn’t have a meetings-only designated room in our house? That sure seems like a long time ago. Some people now call it ‘the background’ room. Others call it ‘the bullpen,’ but if you have kids, you call it whatever is unoccupied.
We are undeniably spending more time looking at our screens, and coming out of that ‘meeting room,’ if even for a second, feels like 5 pm on a Friday. Our mandatory WFH experiment has made each one of us enjoy our time at home (because we can’t go anywhere else), but it’s come with a caveat. We are buying a lot more.
Even if you haven’t assumed your temporary love for interior design yet, other shopping bugs will get to you soon. Compared to this time last year, Americans have bought over 200% more books and cleaning items. Electronics, often considered the most expensive one-off purchases, have also soared over 80%, paving the way to a high-tech, tool-filled future home.
It’s not too far-fetched to think that, in a few years, we’ll go inside our houses, ask Google to turn our Phillips lights on, and try not to step on the Roomba that’s been cleaning for hours (who remembers to schedule that thing anyway?)
The more time we spend at home, the more we spend on it.
And with all in-person entertainment paused, we need to find someplace to spend that money that would usually go towards overpriced drinks on a Friday night and Sunday brunch. How, you may ask?
Step into the exercise room
Mirror is a startup that promises to bring a whole fitness studio into your (newly designated) exercise corner. By bringing a giant iPad-like interactive screen into your home (because who didn’t need one more screen), Mirror has become the dream personal trainer in a socially distanced society.
By bringing workouts with varying levels of difficulty right into your bedroom, the workout-from-home startup has entered the fitness mix just in time. As WFH life continues, we’re all starting to realize that our push-ups just aren’t cutting it.
Peloton’s recent success has proved the virtual workout hardware segment to be successful. But for Mirror, that’s all part of a first step into the digital world. It’s founder and Harvard Alumn Brynn Putnam is frequently quoted on trying to build the ‘third screen’ in our lives and sees her company’s early success as an opportunity to create yet another content platform in our days.
And Putnam’s justified to think that way. At-home technology, in general, is a reality of the future, and you may have read (everywhere) that WFH is the ‘new norm.’ With subway advertisement currently out of fashion, there’s room for more brands in your new commute — from the kitchen to the ‘meeting room.’
So what about pricing? First of all, everyone is quarantined, especially people that can afford to be. Second, pricing was the same concern people had back when Peloton was starting in 2012. And Peloton just so happens to be another company showing over 65% sales increase in the second quarter of the year. Coincidence?
But if you are not yet convinced Mirror is the new screen, you don’t have to be. It’s still early. Even so, Mirror sales have more than doubled since COVID-19 surfaced in March, suggesting that buyers must be in agreement about something.
What’s all that got to do with lululemon?
If you don’t know the answer, you should get a Twitter account.
With Peloton beating sales expectations daily, lululemon saw their future in the literal Mirror. By acquiring Mirror for close to $500 million, the famous apparel brand is now moving toward a new era of fitness.
If you’ve never bought a pair of their yoga pants, lululemon may seem like nothing but a clothing brand to you. But if you are a devoted fan (and call it lulu by now), you understand it’s become a larger fitness statement for the higher-class.
With just the right move, lululemon could position itself amongst the greats. And right now, that move seems to be new virtual workout hardware for their customers’ home.
Come in any time
As an apparel retailer, the Canada-founded brand is dependent on increasing (or at least maintaining constant) demand, which can be quite unreliable and fluctuating in the times of Coronavirus.
Their new at-home fitness hardware comes with a near $1,500 price tag. Besides bringing in an excellent stream of revenue for ‘these unprecedented times,’ the Mirror also provides the first recurring revenue stream for lulu with a $39 monthly subscription.
If lululemon bought a piece of hardware that didn’t have an existing subscription tag attached to the product, this would be an entirely different article. But with the recurring revenue model in place, lulu enjoys a source of steady income that might help them lower that price tag in the future. They might even reach every household that owns a pair of their yoga pants.
The third screen
With its Ring doorbell, an Alexa in every room, and Prime Video for your TV, Amazon has mostly dominated the segment of at-home devices.
But not for long!
While you don’t see the Mirror physically taking up space in your house, it could become one of the best screens you use. Interestingly, it is the one screen that you spend time on to get away from other screens.
With more people working from home, it is also a marketer’s dream in terms of direct-to-consumer sales: it’s in your own house, it’s where you spend your downtime, and it’s where you go to work out.
It’s TV advertising all over again if only TV could get closer and more personal by telling you how to move.
Known as a fitness instruction tool, you can also expect Mirror to roll out new features soon — it may be telling you what to eat (nutrition), what to watch (news integration, content creation), and what to buy (Lululemon apparel). All within your house limits.
One hand washes the other
In every subscription service we sign up for, we expect to get additional value after each payment. That is the reason why companies like Netflix and Spotify adopt this sort of revenue stream.
Mirror is no different. It can provide new value in (and outside) the fitness world. Designed to be the master fitness tool that it is, it’s also a solution that puts Mirror one step closer to their consumer by catering to every aspect of their life.
While we are not talking about an advertising platform (at least not yet), lululemon was highly motivated to close this acquisition when they saw the opportunity to sell their merchandise in people’s homes. Undoubtedly, Mirror instructors will be wearing lulu clothing throughout their classes soon, and it’s easy to expect a quick purchase option available on the screen.
Besides, it works the other way around too. lululemon’s scalability is likely to be reengineered so its customers can purchase the Mirror. And if you know a member of the lulu fan club, you know a Mirror makes sense in their lives too.
Mirror, Mirror, what do you see?
There seems to be a bright future for lululemon.
These reasons surely make the brand see this acquisition as a win. In one move, lululemon proved to all of us that it is not just a clothing brand anymore — much like Nike did when it jumped into the culture-building business and made Jordans famous on the streets.
And it expects to grow fast. BofA analysts expect around 600,000 subscribers in the next two years to be looking at their reflection while working out at home. That may just be the bankers talking, but lululemon shoppers are a loyal bunch.
Best put in the bestseller book by Lauren Weisberger, When Life Gives You Lululemons, the lululemon woman (and man) is one with a higher income and an active lifestyle. In the end, they might also get to be ‘the fairest of them all.’
Thanks for reading! What did you think?
Leave a comment or send me an email here: gvdumit@gmail.com
