Lululemon takes another hit, but will snap back, says analyst

Recall of drawstrings on hoodies unlikely to hurt firm’s image

Who would have thought that drawstrings on women’s hoodies could harm eyes and faces?

Well, it seems they can, and have, though apparently not seriously. And because of that, Vancouver-based Lululemon Athletica is facing another recall.

But don’t expect the giant yogawear retailer to take a financial hit because of it.

“Does this constitute a serious hit to the brand image for Lululemon?” asked retail analyst and Simon Fraser University marketing professor Lindsay Meredith in an interview on Thursday. “I would suggest that it does not,” he said, answering his own question. “(Lululemon) will do totally well. Take a look at the share price. I bet tomorrow you’re going to see it’s up.

“Sometimes it’s the old line you’ve heard, that even bad publicity can be good publicity.”

Meredith was commenting on Lululemon’s recall of drawstrings in about 318,000 women’s hoodies and other tops after seven consumers reported injuries to their eyes and faces.

Elastic cords used in hoods or the neck area can snap back if they’re pulled or catch on something, according to the U.S. Consumer Product Safety Commission (CPSC), which issued the recall jointly with Health Canada.

The recall affects about 133,000 products in the U.S. and 185,000 in Canada.

Customers can remove the cord, and the yogawear company will provide a non-elastic string to replace it.

“Our main priority is ensuring our product works for our guests, and we believe this is the necessary proactive action,” Lululemon said in a statement. “We are committed to making our product right for our guests and regret any inconvenience this may have caused them.”

The company also noted that there were no serious injuries reported and no lawsuits filed.

Asked if the company believes the recall might hurt its brand in light of earlier recalls, the company responded in an email statement: “What we can tell you is that we are always listening to feedback from our guests, and constantly innovating our products. We no longer sell tops that have elastic draw cords with hard metal or plastic tips in the neck area, which were primarily sold prior to 2014.”

As well, the company noted, Lululemon voluntarily contacted CPSC and Health Canada, “in order to take proactive steps to prevent any potential harm to our guests.”

The company previously suffered a product gaffe with its black Luon yoga pants, which would become see-through when customers bent over.

Lululemon chief product officer Sheree Waterson stepped down after the March 2013 recall, and chief executive officer Christine Day announced plans to retire a few months later.

Shares in the company fell after Day’s announcement and Lululemon blamed the sheerness of their pants on a style change and production problems. It later hired a new team to oversee the manufacturing of the pants.

However, Meredith suggested that the latest controversy might just be an example of “ambush marketing,” which he maintains Lululemon is expert at, citing as an example the company’s offer in 2002 of free clothing to customers who arrived naked. “Well, of course, every media source in the bloody country was there to catch that.

“My hunch is that because of the amount of coverage they are going to get out of this story, the Lululemon brand in the end will be net winners,” said Meredith, noting that the see-through pants controversy ended up a winner for Lululemon through all the publicity it generated.

“What that (the see-through controversy) did was get more international coverage for that product than you can shake a stick at.”

“Does this constitute a serious hit to the brand image for Lululemon? I would suggest that it does not. LINDSAY MEREDITH SFU MARKETING PROFESSOR