Alo Yoga is beating Lululemon at its own game

Alo Yoga thinks of itself as a “digital brand” more than a clothing brand or bricks and mortar retailer. In the US, its tech-focused mindset has driven massive business growth since it took off during the pandemic.

Alo Yoga sets have become a reliable feature in paparazzi photos.

When our children dress up as “people from 2023”, 10 years from now on Halloween, they will wear shiny, beige Alo Yoga leggings and sports bras, with puffy white socks, white sneakers and gold chain necklaces. They will clutch giant water bottles, iPhones and Tesla key fobs. They will look essentially like any paparazzi photo from this year of Hailey Bieber on her way to a hot pilates class in Los Angeles.

Exactly how the Alo Yoga matching workout set became the definitive look of our time is a business story, a marketing story, a pandemic story and a celebrity story all wrapped up in one – alongside a healthy dose of happenstance. Right time, right place, right lycra.

Alo, which stands for “air, land, ocean”, was co-founded in 2007 by childhood best friends Marco DeGeorge and chief executive Danny Harris, both 50. But it truly took off during the pandemic, when body-conscious uber-influencers including Kendall Jenner, Hailey Bieber and Bella Hadid ventured out in the brand’s simple, co-ordinated workout pairings.

Most pieces are almost nondescript, with a small, sans-serif “Alo” logo behind the knee and a sheen to certain fabrics that gives them away. Paparazzi photos of these women traversing Beverly Hills parking lots became the brand’s best, albeit mostly accidental, campaign. Like many celebrities, Jenner, Bieber and Hadid are part of Alo’s “community” and do receive free gear and visit its wellness centres, but are not official spokespeople of the brand, nor do they receive compensation. In the past year, the brand has pushed further into men’s (first launched in 2015) as well, with “community member” Justin Bieber and Mr Harris’s “very good friend” Miami Heat basketball superstar Jimmy Butler wearing Alo to work out or just loaf around. Last week, the brand launched its first sneaker, which sold out instantly and now has a wait list. Alo also offers yoga mats, wellness products like a $98 essential oil diffuser, streaming and in-person workout classes and jewellery – including a $210 tiger’s-eye necklace that reminds you to “be here”.

A look from Alo’s summer 2023 campaign.

“It’s everywhere,” said Ana Andjelic, the author of The Business of Aspiration and the newsletter, The Sociology of Business.

She said she realised within the past year that many of the women in her New York City Tracy Anderson workout classes were wearing Alo rather than the historic market leaders Nike and Lululemon.

Mr Harris, the co-founder and CEO, is not a cookie-cutter executive. When asked how many employees the company has, he responded: “Well, that’s a great question. I don’t know ... Thousands. But I don’t know. Those metrics: A normal CEO would be ‘boom, boom, boom’ on those things. But for me, it’s always been more so about the feeling, the good that we can do in the world.”

Growing up in Los Gatos, California, before it was known as Silicon Valley, Mr Harris and Mr DeGeorge attended public schools that received Apple products from local founders Steve Jobs and Steve Wozniak, inspiring them on their own entrepreneurial path. Their first business, at age 14, was climbing trees to pick mistletoe that they’d sell in bundles. The one drawback: too seasonal.

Today, they’re still inspired by the tech mindset. As Mr Harris said: “We think of ourselves as more of a digital brand than we do a clothing brand or a brick and mortar retailer ... I really see Alo being more like Tesla, and the other guys being Ford and Chrysler and General Motors.” That tech-mindedness has led Alo to experiment in the metaverse, with a digital “sanctuary” and collections available on Roblox, and NFT projects.

Is the screen-based, plugged-in digital world at odds with Alo’s focus on “mindfulness”? It’s a paradox, but perhaps one well-suited to court Gen Z customers that scroll through their phones while in line to order a post-workout “Body Ecology” smoothie at Erewhon.

While the scale of privately owned Alo is still smaller than publicly traded behemoths Nike and Lululemon, the company is making swift gains. With 43 stores and, according to Harris, more than $1bn in sales in 2022, it’s made valuable inroads among the discerning Gen Z and Alpha customers. From 2021 to 2022, the business nearly doubled. Lululemon’s revenue reached $8.1bn in 2022, up 32 per cent from the year before, and multisport giant Nike is in another league with its $46.7bn in revenue in 2022. Still, Alo has an intangible “it factor” at the moment.

“It definitely does seem cooler and more relevant than Lululemon,” Ms Andjelic observed. “Why do I think that? I have no idea. Which is exactly what you want when branding works – when people can’t explain why something seems cooler than something else.”

Nike and Lululemon did not respond to requests for comment about the competitive landscape.

The brand has pushed further into menswear in the past year, attracting fans like NBA basketballer, Jimmy Butler

There are, of course, concrete factors that go into making a brand a phenomenon, starting with the product. As someone that has tried most of the comparable workout brands on the market, I can confirm that the Alo leggings I’ve bought in the past few years are pretty good, maybe an A-, in terms of comfort, durability and shape. When they’re clean, I choose them over my Lululemons and Outdoor Voices these days, more based on the actual product than any misguided millennial-mom desire to resemble a Jenner or a Bieber.

Alo has also picked up on the desire for multi-­faceted, experiential stores that transcend the typical bricks-and-mortar model. Called “sanctuaries”, some feature happenings, yoga classes, and “wellness bars” where you can sip nitro matcha on tap. Alo’s CEO Mr Harris, no stranger to hyperbole, told me, “When we open up in a new city like [Tel Aviv in] Israel, I mean we do zero marketing, and the customer is there like it’s a rock concert, like they’re coming to see Michael Jackson or somebody.” (Alo now has three stores in Tel Aviv.)­

Visiting “sanctuaries” does seem to be an activity for diehard Alo fans. Kayla Harrell, 27, a finance associate in Los Angeles, was giddy when a recent date – himself a fan of Alo – took her to the Beverly Hills flagship after lunch at nearby Il Pastaio and dropped around $600 on Alo pieces for her.

“Back in the day, I would wear Lululemon, but it was strictly yoga pants and a top, and it wasn’t that cute,” Ms Harrell said. She likes wearing Alo’s tennis skirts and bralettes out and about, even on dates and to events. She calls them “wearable”.

Alo’s 80,000-sq-foot Los Angeles headquarters, anchored by a giant ficus tree spurting out of its floor, is a testament to the brand’s big vision. It’s open to the “community”, with the Biebers, Jenners, Hadids and more workaday influencers dropping in to use the facilities, which include cryo chambers, cold-plunge pools, infrared saunas, a screening room, a music studio, extensive gyms, pilates reformers, an oxygen bar and a podcast studio.

The 80,000-square-foot HQ in Los Angeles, which houses cold-plunge pools, a podcast studio, cryo chambers and more

In September, 2022, Kanye West stopped by to podcast with Mr Harris, saying, “I honestly believe that Gap and Adidas are part of a bigger plan to marginalise American companies and American industry, which is the opposite of what Danny’s doing.” Of the controversial artist, Mr Harris said, “We haven’t seen or spoken to Kanye West in some time, but for me, mindfulness is so important, and that’s all I have to say about that.”

What’s next for Alo? Harris said there would be more “sanctuaries” more shoes, more experiences, more menswear and more wellness products. Andjelic said success would come down to customer loyalty, retaining the people who bought a pair of leggings or a streaming subscription during Covid.

As for Mr Harris, he’s living the Alo lifestyle, paddle boarding in Santa Monica and Malibu and practising yoga.

While we were speaking, one of his “good friends,” the celebrity trainer and motivational speaker Harley Pasternak, stopped by with a fresh-pressed ginger shot, which he chugged.

“Woo!” he yelped. “It’s burning.”

The Wall Street Journal