Sexy isn’t selling anymore for Victoria’s Secret
Victoria’s Secret, wrapping up another tough year, last week reported a seven percent drop in same-store sales in the fourth quarter and announced plans to close 53 stores.
The chain rose to lingerie dominance with its overtly sexy imagery and brightly colored push-up bras, but both seem to be running against the #MeToo and other women’s empowerment movements over the last decade.
On the product side, competitors including ThirdLove, Adore Me and American Eagle’s Aerie are gaining share by offering more comfortable bra and underwear styles in softer colors. Bralettes and sports bras have found favor over Victoria’s Secret’s push-up bras. Victoria’s Secret’s limited in-store size range has also been called out with many upstarts promoting inclusive offerings.
The bigger issue appears be Victoria’s Secret’s traditional hyper-sexualized, ultra-glamorous imagery. Many newer brands embrace body-positive messages by featuring everyday women, not models, as well as a wide range of body types in advertising. Ratings for last year’s Victoria’s Secret Fashion Show dropped 30 percent. Victoria’s Secret’s avoidance of using plus-sized models has also stoked controversy.
Further, the chain’s lofty pricing is seen as an issue for many consumers. Target’s announcement last week that it is launching three lingerie and sleepwear brands may lead to more pressure on Victoria’s Secret to moderate its prices.
Finally, Victoria’s Secret is being impacted by its heavy exposure in struggling malls.
On its fourth quarter conference call, Stuart Burgdoerfer, CFO of L Brands, the parent of Victoria’s Secret, said the chain’s new heads of Lingerie (John Mehas) and Pink (Amy Hauk) will be “most focused” on improving product assortments. “If the merchandise is special, unique, reflects fashion, has newness, has technical benefit, there are terrific opportunities in the category,” said Mr. Burgdoerfer.
But he underscored that Victoria’s Secret is taking a “fresh hard look at everything” including its marketing pitch and annual fashion show.
Janine Stichter, analyst at Jefferies, told Bloomberg that changing Victoria’s Secret identity could prove difficult. She said, “People identify Victoria’s Secret with what’s it been for the last 20 years — very sexy and airbrushed models. If they were going to pivot now, I don’t think it would come off as authentic.”
- 4Q 2018 Earnings Release – L Brands
- 4Q 2018 Earnings Presentation – L Brands
- 4Q 2018 Earnings Commentary – L Brands
- Victoria’s Secret Needs to Break Out of Its Sexpot Rut – Bloomberg
- These brands are benefiting from fumbles at Victoria’s Secret – CNBC
- Victoria’s Secret closing 53 stores this year – CNN
- Bad Christmas for Victoria’s Secret Means More Store Closings Ahead – Bloomberg
- Is Victoria’s Secret’s ‘buy 2, get 1 free’ promo the beginning of the end? – RetailWire
DISCUSSION QUESTIONS: Are Victoria’s Secret’s challenges related more to product or marketing issues? How should management reposition Victoria’s Secret?