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Victoria's Secret

Victoria's Secret

Tagline

A body for everybody

Net Worth

$1,100,000,000

Started in (City)

Palo Alto

Started in (Country)

United States of America

Incorporation Date

12th December, 1977

Bankruptcy Date

-

Founders

  • Roy Raymond
  • Gaye Raymond

About

Victoria’s Secret is an American lingerie, clothing, and beauty retailer known for high visibility marketing and branding starting with a popular catalogue and followed by an annual fashion show with supermodels dubbed Angels. As the largest retailer of lingerie in the United States, the brand has struggled since 2016 due to shifting consumer preferences and ongoing controversy surrounding corporate leadership's business practices. Founded in 1977 by Roy and Gaye Raymond, the company's five lingerie stores were sold to Leslie Wexner in 1982. Wexner rapidly expanded into American shopping malls, growing the company into 350 stores nationally with sales of $1 billion by the early 1990s when Victoria's Secret became the largest lingerie retailer in the United States.

Beginning

Victoria’s Secret was founded by Roy Raymond, and his wife, Gaye Raymond, on June 12, 1977. The first store was opened in the Stanford Shopping Center in Palo Alto, California. Years earlier, Raymond was embarrassed when purchasing lingerie for his wife at a department store. Newsweek reported Roy Raymond stating: "When I tried to buy lingerie for my wife, I was faced with racks of terry-cloth robes and ugly floral-print nylon nightgowns, and I always had the feeling the department store sales woman thought I was an unwelcome intruder.” Raymond reportedly spent the next eight years studying the lingerie market. Considered niche products, lingerie items (such as lacy thongs and padded push-up bras) were only found in specialty shops like Frederick’s of Hollywood, located “alongside feather boas and provocative pirate costumes“. In 1977, Raymond borrowed $40,000 from family and $40,000 from a bank to establish Victoria's Secret: a store in which men could feel comfortable buying lingerie. The store was named in reference to Queen Victoria and the associated refinement of the Victorian era, while the "secret" was hidden underneath the clothes. Victoria’s Secret grossed $500,000 in its first year of business, enough to finance the expansion from a headquarters and warehouse to four new store locations and a mail-order operation. The fourth store, added in 1982 at 395 Sutter Street, operated at that location until 1990.

Road to Success

Victoria’s Secret transformed into a mainstay that sold broadly accepted underwear with "new colors, patterns and styles that promised sexiness packaged in a tasteful, glamorous way and with the snob appeal of European luxury" meant to appeal to female buyers. In October of 1985, the Los Angeles Times reported that Victoria’s Secret was stealing market share from department stores; in 1986, Victoria’s Secret was the only national chain devoted to lingerie. The New York Times reported that Victoria’s Secret swiftly expanded to 100 stores by 1986 and described it in 1987 as a "highly visible leader" that used "unabashedly sexy high-fashion photography to sell middle-priced underwear." In 1990, analysts estimated that sales had quadrupled in four years, making it one of the fastest growing mail-order businesses. In 1987, Victoria’s Secret was reported to be among the best-selling catalogs. Victoria’s Secret expanded beyond apparel in the 1990s with the launch of their own line of The first Victoria’s Secret Fashion Show, held in 1995 in New York, became a mainstay for the company’s image for the next 23 years. By 1998, Victoria’s Secret’s market share of the intimate apparel market was 14 percent and the company also entered the $3.5 billion cosmetic market. The following year, in 1999, the company added the Body by Victoria line. Victoria’s Secret really began to blossom under Grace Nichols’ wing when they hired her as vice-president in 1986. In 1991, Nichols became CEO and President of Victoria’s Secret. Once VS captured the lingerie industry, they moved to dominate swimwear and bridal wear. Victoria’s Secret expanded to everything apparel-related, from skin care to bags. Victoria’s Secret’s success comes from the purchasing experience they created for the buyer. Today, Victoria’s Secret’s annual sales are over $8 billion. Their 1,000 stores span over a dozen countries.

Challenges

The pandemic accelerated Victoria’s Secret’s long standing issues. Victoria’s Secret is the latest retail casualty of the pandemic, during which non-essential retailers were forced to temporarily close their shops amid various government-mandated lockdowns around the world. It has also suffered from changing consumer habits and tastes, increased competition from online retailers and rising costs – but the pandemic may have been the final blow as its revenues dried up. Due to changing consumer patterns, brand perception and different ways of purchasing clothes, the lingerie retailer experienced losses of £170 million in the year up to February 2019. With this kind of figure, an administration could have been expected. “Pre-Covid, the lingerie chain reported losses of £170 million and cancelled its annual fashion show after it was branded sexist and outdated, with recent comments from executives doing little to change its overall image,” he argued. The lack of inclusivity that alienates a core sector of its audience and a stubborn refusal to adapt to the rapidly-changing dynamics of global consumerism have been a major factor in Victoria Secret’s downfall.

Failures

In 2014, a petition against the company’s newly released lingerie collection Body by Victoria was created when the poster ads displayed the words ’The Perfect Body’ over well-known VS Angels. Organizers called for the company to take responsibility for creating negative body Image. The petition also demanded changes to the wording of Body advertisements to “something that does not promote unhealthy and unrealistic standards of beauty," urging the company not to use such harmful marketing in the future. Petitioners created the hashtag "#iamperfect", which trended on Twitter for body shaming women. The petition had over 30,000 signatures. Although there was no formal apology released, Victoria’s Secret changed the words on their ad campaign to ’A Body for Every Body.’

Achievements

  • Best company for diversity 2018
  • L Brands Supplier Ownership Program Achievement Award 2020

Subsidies

  • La Senza
  • Victoria's Secret Beauty
  • Henri Bendel
  • Mast Industries Far East Ltd

CEOs

  • John Mehas