Lululemon revealed that it has been testing a loyalty program that is so successful it will be expanded soon into additional markets.
The company revealed during its third-quarter earnings call that it has been charging select members $128 per year for curated experiences, free shipping and more. Reviews from its initial test market in Edmonton show that customers would pay even more for the program, which might prompt the company to raise the fee.
Currently, the fee pays for a pair of pants or shorts, the chance to attend curated events, workout classes and free expedited shipping.
“Guests are seeing value beyond just the product,” Lululemon CEO Calvin McDonald said on the company’s quarterly conference call, according to CNBC.
The company also announced that its Q3 earnings saw a net revenue of $747.7 million, an increase of 21 percent compared to the third quarter of fiscal 2017. Total comparable sales increased 17 percent, with comparable store sales going up 6 percent and direct-to-consumer net revenue rising 44 percent.
“Lululemon has achieved a high level of success over the past year and has established a solid foundation to continue to build our future. It’s been exciting to see guests around the world respond so strongly to our product offerings and improved digital experience. I look forward to what’s ahead for our brand as we strive to exceed the expectations of our guests,” added McDonald.
“We’re pleased with our Q3 results and the strong momentum we continue to see across our business,” noted Stuart Haselden, chief operating officer. “These results reflect the strategic investments we’ve made, and continue to make, to achieve our long-term growth objectives.”
While its earnings beat on the top and bottom lines, the company posted adjusted earnings of 75 cents per share and $748 million in revenue. And Lululemon’s shares fell 3 percent in aftermarket trading after it provided a disappointing outlook for the fourth quarter.
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