New Republic explains Lululemon and Chip Wilson, and it is on point.
In fact, Lululemon has been so successful because, not in spite of, its
founder’s combination of woo-woo New Age-iness with a sharply
competitive spirit. It’s the same approach many American women (and men)
bring to buying organic, to drinking fresh-pressed juice,
and yes, to yoga. There is a boom market in ostentatious wellness these
days, one that is underpinned by the same synthesis of seemingly
opposite impulses—to achieve, and to bliss out—that drives Wilson. His
customers are much more like him than many would care to admit. If you
seek spiritual enlightenment through yoga and fasting, go to India or
the 1960s. If you want to have the best-looking ass in line at
Starbucks, try Lululemon’s free Saturday class and a pair of $82 Wunder Unders.
The short version is yes, the pants are flattering and comfortable, but their real triumph is selling the 'lifestyle'. You're not just buying pants (or tops, or jackets, etc.), you're buying something that will enable you to become the type of person that buys those pants.
The men's clothing line is hit or miss. The sweatshirts are great but pricey. The t-shirts are flattering but smell bad because of the synthetic fabrics. The 'silverscent' workout tops are good but at $50 or more it's a big spend. They may/do help prevent embarrassing situations, and that's hard to evaluate in pure economic terms.