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Victoria's Secret Show Is Great But Its Performance Is Not Very Good

Aug 17, 2017

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In the eyes of most people, the US underwear brand Victoria's Secret (hereinafter referred to as "peacekeeping secret") is estimated that the world's most seductive brand, but to say it is now the performance, but a bit ugly.


As of July 1, 2017, the brand's operator, L Brands, released its earnings for the past five weeks, showing a 6% year-on-year decline in net sales, a 9% decline in same-store sales, and a 10% decline in brand equity Group shares fell 7%.


In the statement, L Brands attributed the decline in performance to the elimination of swimwear and apparel products. In April 2016, Victoria secret announced at the end of the year to streamline the category, cut off the swimsuit line to save operating costs, and cut off 200 jobs, and its Pink, Victoria underwear and maintenance of three areas


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This is a centralized strategy, Dimension of hope in the brand transition period will focus on a central fire. With the US consumer transformation, Victoria's performance growth began to decline, just one month before the release of the swimsuit line, the company same-store sales rose only 2%, well below the previous year's 9%.


The company has predicted that this will hurt the short-term interests of the secret, loss of low-end line product sales will be reflected in the earnings report. And now it seems, was really a prophecy, although the swimwear business has only accounted for about 6.5% of total business, but whatever the outcome for the company each year to bring $ 525 million in revenue, and now, with the fashion media Fashionista words, This is a big hole that needs to be filled.


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Victoria's secret store in Shanghai Huaihai Road


Although we can not only comment on the long-term effect of the initiative from a single performance, it is now visible that the decline in performance has dragged down the supplier. It is reported that China's supplier Wei Jie Ni on the US market orders lower than expected by the impact of mid-term earnings fell 89.3% last year, but this also has its Vietnamese factories in the initial operation of the reasons.


Victoria secret intention to find a way out of the new market. In February this year, by the L Brands direct sales of the whole category of luxury stores in Shanghai Huaihai Road Lippo Plaza and Chengdu Vientiane City opened, and by direct mode, the first time in the domestic sales of underwear products. In addition, the big show will also be held in China, enough to see the brand's attention to the local market.


But as to whether the Chinese market to let the secret to re-sexy, but it is difficult to give a positive answer. Due to the United States and Asia market consumer market, the difference between demand, want to sell underwear in China this fashion and functional type of both, I am afraid that investment is not less