Victoria's Secret is planning to close 53 stores this year as more women are losing the brand to lingerie and large retailers.
Sales in stores open at least one year dropped 7% below Victoria's recent quarter, the parent company L Brands said Wednesday. The company's second flagship brand, Bath and Body Works, did well.
Other retailers, including Walmart and Best Buy, have played strongly in recent months. And the economy is strong. But Victoria's Secret and its teenage brand PINK have struggled.
Victoria's Secret has failed to adapt to consumer demand for more customized bras and including messaging and advertising. While underwear marketing trends have changed, Victoria's Secret has largely stuck to the same playbook that helped it dominate the industry: push-up bras and celebrity models.
Victoria's Secret was on heavy campaigns to draw customers to its stores during the holidays – what types of discounts generally damage margins L Brands CEO Stuart Burgdoefer said the company has been "more promotional than we would like over the last few years "in a call with analysts Thursday.
The difficult holiday period and planned store closures are the recent turmoil for the brand. In November, Victoria's Secret & CEO returned. In December, the annual fashion show fell to its worst ratings ever. The company closed 30 stores last year when it tried to escape from weak shopping malls.
The company has lost 3.8 million customers over the past two years to rivals such as Amazon and American Eagle's Aerie, according to an estimate by Neil Saunders, analyst at GlobalData Retail.
Victoria's Secret Way to a Turnaround also looks challenging. L Brands & # 39; forecast for 2019 disappointed Wall Street and sent its shares down 7% in early trading Thursday. It has shed more than 40% in the past year.
"We take a fresh and hard look at everything in the company," said Burgdoefer about planned changes to rectify Victoria's Secret. Victoria's Secret still has more than 950 stores in the United States.
Competition in the lingerie industry has increased in recent years. Startups such as Adore Me and ThirdLove have broken Victoria's Secret's grip on the industry by selling better fit bras and using everyday women, not models, in advertising.
"It's an attractive category," said Burgdoefer about the underwear business.  Large retailers also threaten Victoria's Secret. Target launched a new bra and underwear brand for women and teenage girls called Auden on Monday. Auden bras will cost $ 22 and below. Lululemon and Walmart have also expanded their efforts in space.
The company does not exclude the conclusion of the fashion show or use more inclusive marketing. But changing their identity can prove difficult, says Janine Stichter, analyst at Jefferies.
"People identify Victoria's Secret with what it has been for the past 20 years – very sexy and airbrushed models," she said. "If they were to swing now, I don't think it would come out as authentic. They don't have a good chance."