L Brands Inc reported an unexpected drop in June as consumers move on to more conventional brands like American Eagles Aerie
Victoria’s Secret’s angel wings aren’t beating as energetically as they once did, but you wouldn’t know that from the company’s flagship store in New York Herald Square- a superstore of underwear, bras, bralettes, giant screens of smiling winged models and whole floors of pink-colored products, including a $55 perfume called Eau So Sexy.
What could go wrong selling sexy lingerie to millions of women? A lot, it seems.
Last week, Victoria’s Secret’s Ohio-based parent L Brands reported an unexpected drop in June comparable sales for its lingerie brand, despite a lengthy semi-annual sale and deep cost cuts.
Apparel and retail analysts pounced.” It’s game over” for Victoria’s Secret and Pink, Jefferies analyst Randal Konik said in a note. Customers have moved on to more conventional brands like American Eagles’ Aerie brand, while Victoria’s Secret has insured” massive traffic deteriorations, zero pricing power and market share loss mounting”, Konik continued.
Konik concluded that investors have been ignoring the facts and L Brands stock fell 11%. It is now down 40% for the year. It abruptly seemed the company secret, masked by growth in the company’s teen-focused Pink line, was no longer well concealed. Victoria’s Secret is still the No 1 US lingerie brand, but its share of the market is slipping.