Victoria’s Secret Success is No Secret
by Marge Laney
The last chapter is closing on Holiday 2010 with the release of the January retail sales figures. It was pretty much as we all expected, maybe a little stronger than some had guessed, but overall pretty good for most retailers.
Limited Brands, however, blew it out with strong comps and margin improvement throughout the season. Ending it up with their January performance off the charts with a 24% comp increase company wide, and Victoria’s Secret turning in a 35% comp increase (up against a 17% increase in January 2009); no small feat.
The analysts credit their success to the right product at the right price.
I agree that having compelling product that is priced correctly is crucial, but I think that’s far from the whole story of their success. Nor can their remarkable increase be credited only to a mobile app, kiosk, or discounts (their semi-annual sale took place in January) although they utilize all of these.
What I believe separates them by such a wide margin from the rest of the apparel retail pack is that they wrap all of those right moves they make in product, pricing, and marketing in an in-store experience that is personal, efficient, and consistent across the brand.
When you walk into a Victoria’s Secret you are met by sales associates who know the product and are trained and managed to service their customers from the moment they enter the store to the moment they leave.
On the sales floor they engage with each customer and encourage a fitting room visit where their specialists take over and provide an attentive, knowledgeable experience which in many cases results in a purchase. The cash wrap experience is efficient and appreciative.
Some apparel retailers say that selling underwear warrants special attention and fitting room service, therefore the model doesn’t apply to them. I say baloney! For non-apparel retailers door traffic and sales floor engagement are where the action is. The sales floor is where their customers “try-on” their products and the buying decision is made.
But, for the apparel retailer fitting room traffic and fitting room engagement is where their opportunities lie. The customer who uses the fitting room is 67% likely to buy, versus the customer who shops the sales floor at 10%.
Engaging the customer on the sales floor, driving them to the fitting room, and servicing them efficiently and knowledgeably in the fitting room should be in every apparel retailer’s playbook. For the apparel retailer conversion takes place in the fitting room!
The secret of Victoria’s Secret success is no secret. Simply put, they understand that an in-store experience wrapped in knowledgeable personal service may not be the newest or sexiest strategy, but without it they become just another retailer relying on discounts and gimmicks which ultimately commoditize their products and render their brand forgettable.
Lot’s of retailers sell sexy underwear, but with more than 50% of the market in North America, and unparralled growth Victoria’s Secret is unforgettably the brand to emulate or ignore at your own peril.