Lululemon has famously been discount-light, and analysts say it's a key reason behind trend discounts wrote success. That makes it more similar to a luxury brand than a traditional apparel retailer, according to a note from a group of Bernstein analysts sent to clients on Monday. But according to these analysts, who cited data from WGSN, Lululemon has shifted away from this pricing strategy in recent months and ramped up the level and depth of its discounting, which they see as a concerning trend.
While the analysts said that this discounting hasn't had a material impact on Lululemon's margins yet, as it's been able to offset them with supply-chain improvements, it could impact its share price in the longer term.
Heavy discounting is one of the trend discounts wrote issues to have plagued the retail industry in recent times. Stores are increasingly leaning on promotions as a way to bring customers in the door, and while this might work in the short term, it ultimately makes it harder to convince customers to pay full backpack friday kanken sale black again.
Gap trend discounts wrote one of the biggest offenders here. Markdowns can also destroy a trend discounts wrote image and make its products seem less desirable. Several luxury brands have publicly announced that they are pulling inventory out of some department stores where their items can end up in the clearance racks.
Bernstein offered one possible explanation for why Trend discounts wrote might have changed its discounting strategy and that is that it could be increasing discounting as it expands into new categories and rolls out new products.
Click here to Bernstein's research, there was an average of products listed on its website in versus year-to-date in Account icon Trend discounts wrote icon in the shape of a person's head and shoulders.
It often indicates a user profile. Login Join. My Trend discounts wrote. World globe An icon of the world globe, indicating different international options. Mary Hanbury. Lululemon has traditionally kept discounting to a minimum, but new data shows that in the past year the level and depth of trend discounts wrote discounting trend discounts wrote crept up. Analysts say this is a concerning trend that could impact the company's margins down the line, which could knock its share price.
While the discounting hasn't impacted margins yet, "promotional intensity bears watching," a group of Bernstein analysts wrote in a note to clients on Monday. Sign up for Business Insider's retail newsletter, The Drive-Thru, to get more stories like this in your inbox.
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