Athleta will enter Canada later this year with stores and e-commerce, marking a key step forward in the brand’s bid to surpass $2 billion in volume by 2023.
The San Francisco-based Athleta plans to launch e-commerce in Canada late this summer. In the fall, two retail stores will open in the Yorkdale Shopping Center in Toronto and the Park Royal Shopping Centre in West Vancouver.
In addition, Athleta, a fast-growing division of Gap Inc., plans to open between 20 and 30 stores a year in the U.S. adding to its existing fleet of more than 200 stores across the U.S., which the company said is profitable.
“Canada is really a significant milestone in our growth plans to reach $2 billion by 2023,” Mary Beth Laughton, Athleta’s president and chief executive officer, told WWD on Tuesday. “Women in Canada are really active. She’s hiking, swimming and training.”
Between women in America and women in Canada, “We see a lot of similarity. Hiking is maybe even more prevalent in Canada,” Laughton said. Athleta’s assortment in Canada will be similar to the U.S., with somewhat more emphasis on outerwear and lifestyle products, Laughton said. Categories include yoga, training, travel and sleep.
Citing statistics from NPD, Laughton said the women’s active market in Canada grew 3 percent in the last 12 months.
Technically, Canada is not Athleta’s first move outside the U.S. Last fall, some franchised Athleta shops opened inside John Lewis in the U.K., which also sells Athleta on its website.
“We are just exploring the franchise market to see additional opportunities. Our franchise business is small right now. We also know we have so much opportunity left in the U.S.”
In Canada, “We are committed to opening more stores. There are definitely more to come, but right now, we have no specific openings beyond the two to announce.”
Wholesaling as another avenue for growth is being explored. Earlier this month, five REI stores started selling Athleta. “We will be expanding that further in the fall,” Laughton noted. REI sells a range of gear, apparel and footwear for outdoor and fitness activities.
In 2020, Athleta surpassed $1 billion in net sales and had 16 percent annual sales growth. Asked what gives her confidence that the $2 billion in volume can be achieved by 2023, Laughton cited several reasons. “Our product is so relevant. We have really beautiful, sustainable, technical products in a growing active market. Also, half of our assortment is more lifestyle product. We are highly versatile, and well positioned from a product standpoint.”
Laughton also said Athleta is “sitting at about 50 percent brand awareness among active women in the U.S. And our online e-commerce is really working well for us and has a ton of growth potential. Almost 60 percent of our sales come from online.”
Athleta’s business in Canada will be fulfilled by the Gap Inc. distribution center in Brampton, Ontario, eliminating international taxes and lengthy shipping times for Canada-based consumers. The facility already services Gap Inc.’s Gap, Old Navy and Banana Republic divisions.
In Canada, Athleta will be going head-to-head against the Vancouver-based and much larger Lululemon Athletica. Asked about that competition, Laughton said, “We feel like we have some real points of differentiation. Our focus is on women and girls. We really are a brand by women and for women. It is an advantage.
“It’s also about our values,” Laughton added. “We really are a purpose-driven brand,” emphasizing sustainability, wellness and inclusiveness.
Athleta became a certified B Corp in 2018. The brand will join more than 230 certified B Corp businesses operating in Canada. According to Athleta, more than 70 percent of Athleta product is made from sustainable materials.