For the first time in history, victoria secret reported sales that failed to meet expectations. The American lingerie giant has spent the past two years trying to reboot its image in a bid for relevance, but despite positive reviews online it appears that consumers are still drawn to on-trend upstarts like Savage X Fenty and Parade. Instead, the company’s empowerment reboot may have been a case of “go woke, go broke.”
The story starts in 1979, when Victoria’s Secret founder Roy Raymond published the first of his catalogs featuring women sprawled out in suggestive poses. The business model was genius: women would buy a few pairs of skimpy panties, then feel empowered to wear them with abandon. The sexy brand grew steadily, and by the mid-’80s it had expanded beyond underwear to a full line of lingerie. But even then, the company was a little bit behind the times. Newsweek points out that a 1979 catalog featured women wearing lingerie with men’s names written on it, and that the evocative imagery seemed to be aimed at male shoppers, not female ones. It took a while, but when Wexner’s company bought the brand in 1984, he shifted the focus to women—and it worked.
Over the next few decades, sales skyrocketed. The annual fashion show was a spectacle, and the lingerie brand’s so-called Angels became the faces of the company, gracing the covers of Vogue and starring in sexy commercials. But in recent years, the company has been rocked by #MeToo scandals, alleged links to Jeffrey Epstein, and accusations of oppressive size standards. Former models Bridget Malcolm and Dorothea Barth Jorgensen publicly criticized the company’s sizing policies. Then the company’s then-president Ed Razek sent the internet into a frenzy with an ill-advised interview in 2018 that insulted transgender and plus-size models. In 2020, Wexner sold a majority share of the business to a private-equity firm.
It’s clear that the company needs to shift its strategy again. The new plan includes expanding into activewear and swim, updating its nearly 1,400 Victoria’s Secret and Pink locations, and opening 400 new ones outside North America. The company also plans to cut costs, which will likely mean higher discounts in store and on the website.
All this sounds reasonable, but the company’s investors are skeptical about whether it will be able to bring sales back up over $7 billion. In a call with analysts, the CEO said that the “primary objective is to improve profitability.” “To do that, we’re focusing on what we can control—costs and cash flow,” he said. “The reality is that our performance has been impacted by a combination of factors, including the pandemic, weakening consumer confidence, and lower-than-expected customer traffic.”
The looming question is how much longer the company can keep luring customers to its stores with promotions. It’s a delicate balance, and if the company can’t reinvigorate its customer base, it will be left with fewer and fewer dollars to spend on new products.