Need to Know
- The $500-million acquisition will mark lululemon’s entry into the home-fitness market.
- Mirror and lululemon first partnered in 2019 with a content agreement.
- Mirror will now operate as a standalone business within lululemon.
As home workouts become increasingly popular due to gym and fitness center closures, athletic apparel retailer lululemon is looking to cash in: the Canadian company is poised to sign a $500-million agreement to acquire home fitness platform Mirror.
Mirror, which was established in 2018, offers home workouts and training streamed on its large mirrored devices, which retail for $1,500 (USD). Brynn Putnam, founder and CEO of Mirror, said in a statement that the partnership with lululemon would allow Mirror to “further strengthen its position and accelerate its growth by leveraging lululemon’s deep relationships with its guests, ambassadors and communities, as well as the company’s infrastructure, including its store network and e-commerce channels, to acquire new users.”
For lululemon, the acquisition is an opportunity to expand upon its Power of Three growth strategy, first revealed in 2018 — particularly in the areas of product innovation and omnichannel guest experiences, two pillars in the aforementioned strategy. The company saw its direct-to-consumer sales spike by 68% over the last quarter, a sign that consumers are increasingly turning to digital platforms for commerce and engagement. Lululemon CEO Calvin McDonald said the partnership will allow his company to “accelerate the growth of personalized in-home fitness.”
Indeed, the move positions the company to compete with leaders in home fitness, such as Peloton, who have already popularized personalized home workouts and training programs — and set the stage for a consumer base that’s accustomed to shelling out substantial amounts of cash for the experience. In addition to its $1,500 upfront device cost, Mirror users must pay $39 a month for access to training and fitness programs. But lululemon’s name recognition, combined with an ongoing pandemic that is keeping gyms closed, may lead more customers towards a new, in-home way of keeping fit.
Last month, Peloton hosted its largest-ever online class, as that company’s third-quarter sales surged by 66%; in March, spin brand SoulCycle debuted its own on-demand exercise bike — directly competing with Peloton’s business model — and an online workout platform in an effort to keep customers as the company’s physical locations remained closed.
Lululemon is in good company among apparel retailers pivoting to home fitness, too: Workouts on Nike’s Training Club peaked in April at nearly five million workouts per week, as that company saw a huge spike in digital engagement over the previous quarter.