What statement regarding competitive pressures from substitutes is accurate?

The accurate statement regarding competitive pressures from substitutes being moderate to fairly strong in the given industry aligns with the understanding that substitutes can significantly influence market dynamics. In many industries, including athletic apparel, substitute products represent viable alternatives that consumers might consider when choosing where to spend their money. This means that companies like Lululemon must remain vigilant about competitor offerings, including similar products from other brands or even entirely different categories that fulfill the same consumer need, such as casual wear or athleisure.

The existence of strong or moderate substitutes means that customer loyalty can be swayed if competitors provide better value or appeal, prompting Lululemon to innovate, enhance their customer experience, and possibly adjust pricing strategies to maintain market share. The interplay between substitutes and the core strategies of a company is essential for sustaining a competitive edge and adapting to changing consumer preferences.

In contrast, the other choices diminish the significance of substitutes in the market context. For example, suggesting that substitutes are weak in all markets overlooks the reality that competitive pressure varies significantly based on product and industry dynamics. It also ignores consumer behavior and market research which typically reveal that substitutes impact decision-making. Moreover, stating that substitutes only exert influence on established brands misses the broader competitive landscape, as new entrants can also present