After closing 1,700 stores in the last eight years, Limited has embarked on a series of major strategic and philosophical shifts that, according to its chairman and chief executive Les Wexner, entail:
- Seeking third-party brands for Victoria’s Secret and Bath & Body Works, rather than relying only on its own product development
- Reducing the incessant price promoting and couponing, and staging fewer sales with more impact.
- Generating hype around store openings, rather than the soft openings of the past
- Stretching the reach of the divisions to categories and prices that heretofore were considered out of character, and implementing practices based on those from other industries like the fast-food sector, which glorifies restaurant openings.
- “Fleet optimization” to enlarge and maximize stores at the top 160 malls.
Of the company’s plans to add other brands, Wexner —speaking at Limited’s 2003 analysts update Tuesday in Columbus, Ohio, where the $9.4 billion specialty retailer is based — said: “If we can control brands through our channel it is an interesting proposition for Victoria’s Secret.” Already, Victoria’s Secret has begun selling “very expensive European lingerie in the direct channel.” It could be further exploited on line and in the catalog and ultimately by Victoria’s Secret stores.
“The notion of being close to the customer means you are close to your competitors and close to ideas,” Wexner said.
Bringing third-party brands to BBW is part of a reconceptualizing of the chain, which was originally regarded as “a 1,000-square-foot store, with Betty Crocker from the farm kind of position,” Wexner said. “That was a great position,” enabling BBW to attain a multibillion-dollar volume in 10 years. However, “it got stuck in its own warm wet diaper and liked to reflect on the golden old days,” Wexner said.
Meanwhile, the consumer became more aware of other brands. Now, Wexner views BBW as operating larger units, four times the size, and with outside brands, such as Molton Brown from the U.K., which operates its own stores in Britain and also wholesales to Barneys New York and Neiman Marcus.