The largest subsidiary of L Brands, Victoria's Secret Stores is also North America's #1 specialty retailer of women's intimate apparel, operating about 1,100 mostly mall-based Victoria's Secret and Victoria's Secret Pink shops throughout the US, Canada, and now the UK. Bras, panties, hosiery, swimwear, and fragrances are sold under the Victoria's Secret brand and grouped in collections such as Angels and Very Sexy. Many Victoria's Secret lingerie stores also sell beauty products. The chain's youth-oriented PINK brand targets teens and younger women with less-racy bras and panties, as well as sweats and hoodies and beauty products.
Victoria's Secret operates about 1,100 locations in the US, about 45 in Canada, and 14 shops in London. Beyond North America, nearly 370 Victoria's Secret Beauty and Accessories Stores (formerly Victoria's Secret Travel and Tourism Stores) are operated by partners, primarily at airports and tourist destinations.
Sales and Marketing
In addition to its network of company owned stores, Victoria's Secret's products are sold at hundreds of partner locations in over 80 countries. It has arrangements with unaffiliated partners to operate Victoria's Secret, Bath & Body Works, and La Senza stores throughout the world.
Victoria's Secret is a top performer among L Brands' retail businesses, generating about 60% of its total revenue in 2016. Victoria's Secret's revenues climbed by $465 million in 2016 to peak at $7.67 billion. This was due to higher Victoria's Secret Stores and Victoria's Secret Direct sales, resulting from the performance of PINK brands, core lingerie, and sport sales driven by a compelling merchandise assortment that advertised newness, innovation and fashion, as well as in-store execution.
The UK and Canada are growth markets for Victoria's Secret Stores. In 2012, the retailer opened a flagship Victoria's Secret store on New Bond Street in London, as well as a mall-based store. Four more Victoria's Secret shops opened in the UK in fiscal 2016 (ended January), bringing the store count there to 14. The chain is also continuing its expansion in Canada. Other channels for growth include the Victoria's Secret Beauty and Accessories Stores, which added 98 locations in fiscal 2016, bringing the total to more than 200.
The youth-oriented PINK brand has established itself as a successful feeder brand for Victoria's Secret. Its aim is to capture teen and college-age female customers in the hope that when they mature they'll move on to the sexier styles offered by its big sister brand. PINK is sold in freestanding stores as well as Victoria's Secret shops. While the company doesn't break out PINK sales, the brand is meeting stiff competition from American Eagle's Aerie brand and Gilly Hicks by Abercrombie & Fitch. Both also target the youth market.
In 2016 and beyond, Victoria's Secret plans to increase the square footage at Victoria's Secret North America by about 4% through expansions of existing stores and the opening of approximately 13 net new Victoria's Secret stores primarily in the US. It also believes direct channel is an important form of brand advertising given the ubiquitous nature of the Internet.