When Gap purchased women’s active sports brand Athleta in 2008,
the online and catalog-based brand was tucked under Gap’s internet division.
Three years later, Gap kicked off a measured store opening spree for Athleta
that put popular niche yoga player, Lululemon, on notice. Although Lululemon’s
current store count of roughly 135 stores in the U.S. dwarfs Athleta’s 30
locations, over a third of Athleta’s stores are within one mile of a Lululemon store,
with some situated as close as a 12-minute walk away in major markets. Although
Gap has claimed that its cozy proximities are a coincidence, given both chains’
relatively modest U.S. store counts, Lululemon could be seen as an annoyed diner
seated elbow-to-elbow with fellow patrons despite being surrounded by a room
full of empty tables.
As the race for space continues, the biggest challenge for
encroaching retailers will be to carve out additive businesses rather than
simply diluting the market. In the meantime, retailers with established footprints
may need to evaluate the productivity of individual stores as the local