Victoria’s Secret plans to revive its annual runway show in the future – only without its Angels this time.
Victoria’s Secret canceled its runway show in November 2019, 24 years after it launched in 1995. Les Wexner, then CEO of parent company L Brands, said at the time that the company didn’t think “network television is the right fit” for the show and that it was rethinking “literally everything” about the business.
In its heyday in the late 90s and early to mid-2000s, the event attracted millions of viewers. The show, and the costumes, became more elaborate as the years went on.
Ed Razek, the brains behind the show and L Brands’ marketing chief, was considered one of the most influential people in modeling throughout the early 2000s, and helped launch the careers of household names such as Gisele Bündchen, Tyra Banks, and Heidi Klum.
Victoria’s Secret will continue to work with former Angels even after it abandoned the concept last month, its new creative director has said.
In an interview with The New York Post, Raúl Martinez said: “The word Angel is retired but that doesn’t mean the women we worked with as Angels are retired.”
Martinez told the Post that at least three former Angels will continue to model for the brand, including 25-year-old Taylor Hill, 24-year-old Grace Elisabeth, and 52-year-old Helena Christensen.
Victoria’s Secret announced in June that it was scrapping its Angel brand because it was no longer “culturally relevant.” It said that instead, a group of seven activist and entrepreneurial women – including Indian actor Priyanka Chopra Jonas and the professional soccer player and gender-equality activist Megan Rapinoe – would become spokeswomen for the brand.
Martinez took on the position of creative director at the start of the year and has been tasked with bringing the brand to life visually. He works closely with the design and marketing teams and has the final say over anything from what photographers Victoria’s Secret hires to shoot campaigns, to what fonts it uses in its ads.
The name Angel was first coined in 1999, when models Helena Christensen, Karen Mulder, Daniela Peštová, Stephanie Seymour, and Tyra Banks appeared in an ad to promote the Angels underwear collection.
In the late 1990s and early 2000s, the Angels and the annual Victoria’s Secret runway show had a powerful role in defining “sexy” in the modern day. More recently, it has been criticized as outdated and out-of-touch.
Wexner, who stepped down as CEO of its parent company L Brands in February 2020 and from its board in March, has been selling large chunks of stock over the past few months – most recently, $745 million-worth.
Wexner and his wife Abigail are among the company’s largest shareholders. According to Bloomberg, this latest sale would leave them with around a 10% stake in the company.
Up until he stepped down last year, Wexner was the longest-serving CEO of any Fortune 500 company. He was credited with transforming Victoria’s Secret into a global powerhouse.
“At some point in your life we are all betrayed by friends,” Wexner said in a statement at the time. “Being taken advantage of by someone who was so sick, so cunning, so depraved, is something that I’m embarrassed I was even close to.”
World-famous models including Gisele Bündchen and Adriana Lima, who hold a superior status with the brand, have finished years with multi-million-dollar salaries, per Insider. In 2018, Bündchen earned $30.5 million and Lima $10.5 million, but other Angels, including Taylor Hill and Jasmine Tookes took home $4 million.
But the level of commitment has meant that Victoria’s Secret has lost Angels in the past.
As previously reported by Insider, Doutzen Kroes and Karlie Kloss both pulled out of contracts early to focus on other commitments.
Sources highlighted to Page Six that relatively little pay over time was also a factor in Angels’ decision to depart. “Older contracts like Alessandra Ambrosio used to be in the millions, now they’re like $100,000,” a source told the outlet.
There have been 41 Angels in total since 1997 when Christensen, Mulder, Peštová, Seymour, and Banks were first taken on.
From popular musical acts including Taylor Swift and Kanye West, elaborate costumes and historical venues, to models sporting ornamental Angel “wings,” that can take up to 400 hours of labor, down the runway, the shows became a yearly attraction for many.
Carrying the wings was no easy feat.
One year, Angel Alessandra Ambrosio revealed in an interview on “Late Night With Seth Meyers,” that she wore one of the heaviest pairs of wings in history in 2011, weighing around 60 pounds, per Insider.
Some of the world’s top supermodels including Gigi Hadid and Kendall Jenner were among the catwalk’s line-up but never made it to Angel status.
Victoria’s Secret is cutting back on deals and raising prices, and Wall Street is on board.
In a note to clients this week, UBS analysts Jay Sole and Mauricio Serna reiterated their recommendation to buy L Brands stock (the parent company behind Victoria’s Secret) and shared data that showed the level of promotions in Victoria’s Secret stores – which includes its Pink brand – was “declining at a surprisingly fast rate.”
UBS said the average price of an item listed on Victoria’s Secret’s website in May 2021 was $44, a huge 83% increase from May 2019.
It also found that a quarter of the products on its site were on sale in May 2021. This is still a substantial number but a notable improvement on the level of promotions over the past four years, which floated around the 40% to 60% mark.
“This boosts our confidence that the Victoria’s Secret turnaround is real,” these analysts said.
Victoria’s Secret has been strongly criticized by Wall Street in the past for constant promotions in stores. Analysts said these not only erode profit margins but also dampen the brand image and make it almost impossible to encourage customers to pay full price.
It wasn’t uncommon to see 40%-off sale signs littered around its stores between 2018 and 2019, and underwear deals such as five pairs of panties for $28. And major discounts of this kind are usually a sign that retailers are looking to clear unwanted inventory.
In 2019, the company promised to cut back on these promotions and tighten inventory levels but shortly after, discounts began to creep back in. At the time, UBS analysts said that price increases could be putting off customers, causing Victoria’s Secret to go back on its progress.
Victoria’s Secret’s price points have been a contentious subject as some shoppers previously said they felt the brand was still overpriced despite all the deals and discounts. And others said the quality of the clothing didn’t match these price points.
But Victoria’s Secret’s growth over the past few quarters – same-store sales were up 9% in the first quarter of the year versus 2019 and operating income, a measure of profitability, increased by $213 million or 665% – indicates that consumers are becoming comfortable paying more for its apparel and lingerie and that it has a better handle on its inventory levels.
Gabriella Santaniello, analyst and founder of retail research firm A-Line Partners, told Insider that the pandemic enabled Victoria’s Secret to have a “reset,” and cut back on its inventory, which has facilitated more full-price sales, she said.
More inclusive marketing pays off
The company has made considerable changes to its marketing in the past year. And experts say efforts to update its brand image, which critics previously said was out-of-date and oversexualized, have also helped to boost sales.
The marketing is “more subtle and appropriate,” Neil Saunders, managing director of GlobalData Retail, told Insider. It has “fewer sexual overtones and focuses more on more on celebrating women. That has resonated and has pulled some shoppers back to the brand,” he said.
And it matches up to what’s shown in stores, Santaniello said: “For example, they recently brought in plus-sized mannequins, which reflects their use of plus-sized models in their advertising.”
Still, the company needs to keep this “360 focus” long-term, she said. “They need to make sure they do not waiver because it will come across as inauthentic and that’s why they haven’t really been successful with the turnaround over these past few years.”
Victoria’s Secret is having somewhat of a comeback, and Wall Street is starting to get excited about it.
In L Brands’ earnings call this week, several analysts congratulated the management team on Victoria’s Secret’s first-quarter results. Same-store sales were up 9% in the first quarter of the year versus 2019 and operating income, a measure of profitability, increased by $213 million or 665%.
“Welcome back,” Marni Shapiro, an analyst at The Retail Tracker, triumphantly said on the call. “I am so excited about this…it’s brilliant and overdue.”
The sentiments of this week’s call stood in stark contrast to its earnings a year ago when the management team was navigating store closings and worker-safety issues brought about by the pandemic.
It was also adjusting to the news that a private equity firm that had agreed to buy a majority stake in the company was pulling out of the deal. This left investors wondering whether Victoria’s Secret would be able to continue its turnaround effort – addressing sliding sales, former sexual harassment allegations, and moving beyond its connection to the Jeffrey Epstein scandal.
How then, did management swing the pendulum around and come to win back Wall Street?
Overtly sexualized ads, the Epstein connection, and harassment allegations
To understand Victoria’s Secret’s “comeback”, it’s necessary to understand its downfall.
Between 2016 and 2020, the brand became the subject of intense scrutiny among investors and the media. After it achieved explosive success between the mid-1990s to mid-2000s with its racy runway shows (which helped to launch the careers of Gisele Bündchen, Tyra Banks, and Heidi Klum), it was increasingly accused of being out of date and oversexualized in its brand image, especially in the wake of the #MeToo movement.
Sales started to dwindle, customers complained that the quality of its lingerie and apparel had slipped, and analysts became more critical as the level of promotions in its stores crept up, highlighting them as evidence that the company was struggling.
In early 2020, the company then faced a fresh wave of scandals after a New York Times investigation found a culture “of misogyny, bullying, and harassment” at the brand, which longtime marketing chief Ed Razek and Wexner were accused of creating.
Former executives, who held longtime positions at Victoria’s Secret’s corporate offices, told Insider in 2019 that Razek and Wexner had full control over the brand image and made it impossible for any CEO of Victoria’s Secret to update this or make a mark.
‘We’re moving from what men want to what women want’
In the time since these explosive reports, both Razek and Wexner have stepped down from the company. Wexner and his wife, Abigail, are no longer on the board of directors but remain L Brands’ biggest shareholders.
And Victoria’s Secret’s executive team and L Brands board have undergone a major shakeup in the past year, gaining a new CEO, Martin Waters, who previously headed up L Brands’ international division.
The lack of diversity on its board, which was criticized by an activist shareholder, has also been addressed. In 2019, out of the 11 board members, nine were men. Today, there are six women on the board, including the chair, Sarah Nash.
Critics say this shake-up has been crucial for Victoria’s Secret’s comeback by allowing new perspectives and fresh ideas to come through.
“We’re moving from what men want to what women want,” Waters said on the call on Thursday. “From sexy for a few to sexy for all.
“It’s about including most women rather than excluding most women and being grounded in real life rather than mostly unattainable,” he said.
Morgan Stanley analyst Kimberly Greenberger said she “applauded” its “long overdue positioning shift,” in a note to clients Friday.
The brand imagery of 2021 looks very different from what Victoria’s Secret had previously been known for; oversexualized ads have been replaced with more body-positive campaigns.
A post shared by Victoria’s Secret (@victoriassecret)
Waters said that customers are responding well to these changes.
They “are noticing and uploading our efforts to reposition the brand,’ he said Thursday. “We heard clearly what they [customers and associates] want from us as a brand, which is all about representing and celebrating all women and being there for every moment of their life, including supporting and advocating the things that matter most to them, and that’s exactly what we’re doing.”
According to, Gabriella Santaniello, analyst and founder of retail research firm A-Line Partners, the company is following through on its marketing by enacting real change in its stores. “They recently brought in plus-sized mannequins which reflect their use of plus-sized models in their advertising,” she said in an email to Insider on Friday.
“I think they need to focus on a 360 view of the brand. During the pandemic, they were able to evolve and tie up some loose ends. They need to make sure they do not waiver because it will come across as inauthentic and that’s why they haven’t really been successful with the turnaround over these past few years,” she added.
Neil Saunders, managing director of GlobalData Retail, said that more “appropriate” marketing is pulling shoppers back to the brand. As is, a better product assortment.
Victoria’s Secret “has been sensible over the past year and there is a lot of focus on making women feel good whether it be through indulgences or cozy items to wear around the house,” he wrote an email to Insider.
But there’s still work to be done. Waters said the focus now is bringing more innovation to its products, especially around its bread and butter item – bras.
Santaniello said that the pandemic gave Victoria’s Secret time for a moment of pause to address its business.
“This past year was just a culmination of strategies they put into place but never fully implemented,” she said. “They were smart in using this past year, which was essentially a reset across all retail, to finally tie up their loose ends.”
During this time, Victoria’s Secret closed 250 underperforming stores and was able to pull back on inventory and cut the level of promotions. This boosted its margins in the most recent quarter.
Still, Saunders says its comeback shouldn’t be overinflated. Some of its performance has been boosted by stimulus spending and a booming consumer economy, he said.
“That rising tide of spending is floating all boats. The real acid test is what performance looks like in the quarters and years ahead,” he added.
Shares of Victoria’s Secret parent company L Brands climbed Friday after lingerie retailer raised its quarterly earnings outlook, citing stimulus payments to Americans as a pillar of sales support.
L Brands now expects first-quarter earnings of $0.85-$1 per share, higher than its previous forecast of $0.55-$0.65 per share, excluding any charges related to the early extinguishment of debt. Analysts were looking for earnings of $0.62 per share, according to a survey of analysts at Yahoo Finance.
The shares tacked on 6.7% when they hit $63.40. This year, the stock has jumped nearly 60% and has risen over the past 12 months from about $12.50.
“Improved sales trends,” the company gauged, “are primarily driven by unusual shifts in consumer spending patterns, resulting from government stimulus payments, a relaxation of COVID-19 restrictions and other factors.”
The US government this month began sending out $1,400 checks to most Americans to help them deal financially with the COVID-19 health crisis. Meanwhile, more businesses have been reopening services with the vaccination of millions of people in the US against coronavirus. About 14% of the population has been fully vaccinated, according to the Centers for Disease Control and Prevention.
The company said it’s seeing stronger activity at its Victoria’s Secret chain as well as its Bath & Body Works stores.
“The environment remains uncertain, and there is no assurance that these improved trends will continue,” L Brands said.