RYU Is Fighting For A Niche

by Randall Radic
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Submitted by Randall Radic as part of our contributors program.

Respect Your Universe (OTC:RYUN) is an athletic wear company, specializing in clothing for those involved in the mixed martial arts industry. By developing special fabrics customized specifically for martial artists, and by adhering to a strict branding strategy, the company, following online profitability, will soon open its first retail store. Breaking into the clothing industry is similar to swimming across a shark infested ocean. It requires cunning, skill and endurance. And not many make it. Nevertheless, RYU hopes to complete the arduous crossing, reaching the same level of success as two other companies that have gone before: Lululemon Athletica Inc. (NASDAQ:LULU) and True Religion Apparel Inc. (NASDAQ:TRLG).

Respect Your Universe understands that a shot at success revolves around one thing: tailoring their brand to a specific audience. They learned that lesson from two that already achieved their goal.

Lululemon grew out of founder Chip Wilson’s passion for yoga. After suffering through a sweaty, uncomfortable yoga session, Chip began researching technical athletic fabrics. He rented a design studio and began strategizing various ways to make the Lululemon brand ‘sticky.’ Two years later, the first Lululemon store opened in Vancouver, BC. The goal of the store was to be much more than retail outlet. Chip envisioned a place, a community of likeminded people, where people could discuss the benefits of healthy living as well as purchase Lululemon products. The idea not only caught on but took on a life of its own. Soon, Lululemon stores were opening all over the U.S.

Lululemon succeeded by focusing on a single target group: women who love yoga. Yoga was continuing to gain popularity, especially among women. Yet a line of clothing designed specifically for Yoga did not exist. Participants arrived in whatever was handy, hoping it absorbed sweat and didn’t chafe. Lululemon changed the Yoga paradigm. Participants didn’t have to suffer physical discomfort while they practiced. There was a line of clothing for just that purpose.

In a similar “fashion,” True Religion Brand Jeans targeted a specific group of people: fashionable trendsetters. The jeans were the brainchild of Jeffrey Lubell. As a teenager Lubell wore bleached bell-bottom jeans. Eventually, the jeans fell apart. Rather than buy new ones, Lubell patched them up, using bits and pieces of any fabrics he could get his hands on. That was the beginning of embellished denim wear. Initially, the jeans languished in the Siberia of brand identity – nowhere. The big break came when Lubell bribed an L.A. specialty store to launch his jeans. The bribe consisted of a free pair of jeans for the store’s entire staff. Patrons noticed the jeans, which became an overnight hit. The brand really took off when celebrities began wearing True Religion Brand Jeans. What started as mending old jeans is now a $400 million company that caters to customers at over 125 standalone stores worldwide. (http://www.truereligionbrandjeans.com/company_profile.aspx)

RYU hopes to emulate Lululemon and True Religion. The company began when a few friends came together to design the best martial arts performance short available. Their approach was a little different. Thinking outside the box, they sought the input of the top mixed martial arts athletes, asking them one question: what did the perfect pair of shorts look like? They incorporated everything they heard into a pair of shorts. RYU created the short that “the warrior in all of us demands.” That slogan said it all. RYU’s target market wasn’t simply martial arts athletes, but the warrior hidden inside each individual.

Lululemon became the gold standard for yoga wear. True Religion became the fashion symbol go-to for thousands of denim trendsetters. Likewise, RYU hopes to establish itself as the first company that comes to mind when mixed martial arts are mentioned.

In 2011, RYU began offering it products online as well as in a handful of sporting goods stores. First quarter of sales garnered $70,000. The company forecasts second quarter sales to dwarf those of the first quarter. RYU will be launching its flagship store in Las Vegas later this year. A second store, already in the planning phase, is scheduled for late 2013.

So far, Respect Your Universe has won the first few rounds. If the company gets lucky, they’ll pick up momentum along the way, making it unnecessary for them to tap-out.

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