Skip to comments.Bob Dylan Hawks Women's Panties for Victoria's Secret
Posted on 03/30/2004 6:10:03 PM PST by O.C. - Old Cracker
FORT COLLINS - Colorado State University students got to hear the serious side of selling frilly things.
Grace Nichols, president and chief executive officer of Victoria's Secret Stores since 1991, detailed the business of the famous lingerie retailer Wednesday as the keynote speaker for the school's Business Day.
"Behind the glamour, the supermodels and the public face, there is a business structure supporting all that," she said.
The brand's story begins 22 years ago, when Les Wexner wandered into a European-style lingerie boutique on a trip to San Francisco. Wexner, chairman and CEO of Limited Brands Inc., saw the potential to develop the concept into a large national chain, Nichols said. Soon after, Limited paid $1 million for the company.
Today, as the largest of Limited's brands, Victoria's Secret operates 920 U.S. stores and generated $3.5 billion in sales in 2002, including about $1 billion from online and catalog sales.
The picture was quite different in 1986, when Nichols joined the company as vice president and general merchandise manager.
"There were 100 stores, $100 million in sales, and the stores didn't make any money," she said.
Heavy discounting was common, she said, with the average bra selling at $12.
That began to change in 1993 with the first national advertising campaign, which included TV commercials and print ads. Since then, the company has grown to command a much bigger chunk of the $12 billion U.S. lingerie market.
Nichols showed the audience a clip of commercials, as well as a reel from all the free news and talk-show coverage of the company's world-famous fashion show.
The combination of advertising and public relations campaigns around the fashion shows spurred rapid growth in the 1990s, she said, and also allowed the company to stop heavy discounting.
Today, the average bra in Victoria's Secret sells for between $35 and $50, she said, and sales happen only twice a year, in January and June, to clear out seasonal items.
According to the company's annual report, filed with the U.S. Securities and Exchange Commission, Victoria's Secret saw sales at stores open more than a year climb by 6 percent in 2002.
The company expects to see bigger jumps in the coming years, as it works on increasing the size of its stores in existing markets, Nichols said. More stores, which now average about 5,000 square feet or so, will take on the look of the 21,000-square- foot flagship Manhattan store.
In markets where the renovation and expansion have been done and customers have more to choose from, she said, sales have jumped by almost 50 percent.
Victoria's Secret expects future growth to come from its continued focus on core items - bras and panties - as well as its sub-brands, including its best- selling "Body by Victoria" line, which brings in $500 million in annual sales.
This year, the company launched a new sub-brand, called Pink! and aimed at 18- to 24-year-old women, slightly younger than the company's typical customers.
And Victoria's Secret plans another ad blitz beginning this month. The latest commercials will feature not only a song but a guest appearance by music legend Bob Dylan.
"We asked him to be in the commercials and he said yes, he would gladly go off to Venice with the supermodels," she said.
Lounge around in big bras red....
Footnote: this is the first time a poster has used the word "blonde" in successive posts to different threads.
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