Lululemon Is Feeling The Heat From Competitors

<img style="float:right;" src="http://static6.businessinsider.com/image/532310596da811244cd10f77-480-/lululemon-2.png" border="0" alt="Lululemon" width="480" />

Lululemon's share price is down 16% in 2014.

The company has been hit by a string of quality control and customer service issues. These problems blew the door wide open for competitors like Nike and Under Armour.

And despite having a new CEO and strategy, Lululemon's problems are far from over, said Brian Sozzi, chief equities strategist at Belus Capital Advisors.

"<span style="line-height: 1.5em;">There is explosive growth occurring for offerings from Nike and Under Armour that is h</span><span style="line-height: 1.5em;">igher quality and more versatile, for lower prices, than at Lululemon," Sozzi said, adding that Lululemon might have to start selling cheaper products to connect with customers. </span>

<span style="line-height: 1.5em;">Web traffic is also exploding at Nike and Under Armour, while Lululemon's growth is slowing, Sozzi said. </span>

<span style="line-height: 1.5em;">Lululemon is also not capitalizing on incorporating technology into its clothing, a trend illustrated by the popularity of Nike's FuelBand. </span>

<span style="line-height: 1.5em;">"Although a premium player in the athleticwear market, Lululemon is not immune to rising style choices with improved quality by competitors," Sozzi said. </span>

In order to succeed, Lululemon is going to have to commit to quality or lower its prices.

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