Pedestrians walk in front of an L Brands Inc. Victoria’s Secret store in San Francisco (Photographer: David Paul Morris/Bloomberg)

Victoria's Secret Is Still Advertising to Women Like It's 1999

(Bloomberg) -- Victoria’s Secret was founded during one sexual revolution. It’s not clear it’ll make it through the next one.

While still the dominant lingerie retailer in the U.S., Victoria’s Secret sales have dropped in each of the past six quarters and show few signs of rebound -- a drop that coincides with the rise of online lingerie brands and changing sentiment about women, bodies and sex appeal.

Parent company L Brands Inc. isn’t expected to show much improvement when it reports first-quarter earnings Wednesday. Even its Pink chain, aimed at younger shoppers, is slowing. Shares are down 44 percent this year, deepening a slide that’s eroded 65 percent of the company’s market value since 2015.

Victoria's Secret Is Still Advertising to Women Like It's 1999

Roy Raymond founded Victoria’s Secret in the 1970s, but longtime L Brands Chief Executive Officer Les Wexner has engineered its rise since he acquired it in 1982. Victoria’s Secret brought bras and panties into the open, first on the sales floor, then on runway models. Its popular catalog took its cues from romance novels and Cosmopolitan magazine, a mix of sexiness and windswept allure. When popular culture got more explicit, so did Victoria’s Secret’s marketing and its cleavage-accentuating product lines.

Victoria's Secret Is Still Advertising to Women Like It's 1999

But the company has been slow to understand more recent cultural changes. “The way we even talk about sexiness has shifted now -- the idea is sexiness isn’t something reliant on being a glamazon or having long hair, there’s lots of different kinds of sexy,” said Cora Harrington, editor of the Lingerie Addict blog. “The one vision Victoria’s Secret has of sexy is out of place.”

Or, as Candace Corlett, president of consulting firm WSL Strategic Retail put it, “Are they aware there’s this thing called #MeToo out there?”

Upstart Brands

The growing competition is promoting more variety in models and products. Now in its fifth year, online retailer ThirdLove has shoppers answer a series of intimate questions about their breasts -- which of these nine illustrations matches your breast shape? -- while reassuring consumers that every woman’s body is unique. The company has raised $13.6 million from investors and expects to double its sales this year. Companies like Adore Me, True&Co. and Everlane are taking a similar approach.

Victoria's Secret Is Still Advertising to Women Like It's 1999

In the mall, Victoria’s Secret is facing new competition as well, primarily from American Eagle Outfitters Inc.’s Aerie brand. The intimates chain is opening stores and amassing a teen and young-adult following, getting attention for its campaign using models of many body types whose images aren’t retouched in editing. Comparable sales at Aerie increased 34 percent in the fourth quarter, and it ended the year with $500 million in sales.

Bee Walsh, a 29-year-old dog walker living in Washington said she buys almost all of her underwear and bras from Aerie because their products are comfortable and compelling. When she wants something special, she’ll browse independent merchants on Etsy or click an ad on Instagram. The last time she bought something at Victoria’s Secret, it was a bralette -- she returned it.

“The conversation right now is more about bodies than it is about underwear,” she said. “People are defining for themselves where they fit in society, and they don’t have to settle.”

At Victoria’s Secret, sentiments aren’t evolving. Nearly every style comes with a push-up option, from unlined lingerie to sports bras.

Victoria's Secret Is Still Advertising to Women Like It's 1999

“Women want to project a figure,” said Wexner, 80, in a recent interview in the Financial Times. Wexner and other L Brands representatives didn’t respond to interview requests for this story. “You wouldn’t have to be James Bond or Dick Tracy or the head of the FBI,” to know that breast-augmentation is “a popular thing,” he said.

There is still a lot to like about Victoria’s Secret, experts like Corlett and Harrington say. In particular, the store cares about service, has a national presence and is focused on one kind of item at a mid-range price point. Women work the fitting rooms, available to measure customers, pull different styles and offer a t-shirt to put on over the product to see how it might fit under clothing. This service, which many older women sought from department stores, is an in-person experience the retailer should try to replicate online and market to its shoppers, WSL’s Corlett said.

“Once you get past the bombshell windows, they care about fitting you well,” Corlett said. “They’re not inexpensive, but they wear well and they fit well -- and maybe that’s more the side of the store they should be playing up.”

To The Lingerie Addict’s Harrington, one quick fix for the retailer would be to expand its size offerings as many online and department-store brands have to fit more bust sizes.

“They just actively avoided doing anything to make the brand more inclusive, and that’s becoming glaringly obvious now,” Harrington said. “What are they waiting for?”

©2018 Bloomberg L.P.