Table of Contents
05 Mission 06 Company History 08 Brand Identity 11 Last Year’s Sales 12 Selling Platforms 15 Target Customer 19 Product Range 20 Strengths 23 Chosen Product Category 24 Competitors 36 Swot Analysis 38 Key Fashion Items 52 Trends 61 Lifestyle Trends 66 Technology Trends 68 Corporate Buying Plan 70 New York Store Plan 72 Texas Store Plan 74 Assortment Plan 78 Opportunity Statement
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“ Limited Brands is committed to building a family of
the world's best fashion brands offering captivating customer experiences that drive long term loyalty and deliver sustained growth for our shareholders �
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Company History
Founded in 1977 by Roy Raymond Raymond wanted to make men feel at ease when purchasing lingerie for their significant others The lingerie was displayed in frames as an outfit, making it easy for men to select what to purchase Leslie Wexner purchased the company from Raymond after seeing the potential to fill the void in an undertargeted retail division Wexner changed a utilitarian product into a personal luxury and fantasy
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Feminine Sexy Sophisticated Powerful Independent Brand Identity 08
Desired
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Last Year’s Sales
$7.7 Billion Annual sales $6.1 Billion Stores $1.6 Billion E-Commerce 4.8% Annual Growth
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Selling Platforms 12
Victoria’s Secret has 993 stores in the United States and 1164 stores worldwide. These stores have a total of 7,309,000 square feet of selling space. In addition to brick-and-mortar stores, they also have a mobile app that is linked to their e-commerce and a heavy social media presence. Victoria’s Secret started out with their seasonal catalog to showcase their new collections. The fashion show is another platform to drive sales by providing a fantasy for the consumer.
Target Customer Victoria’s Secret targets an extremely large range of customers, reaching all generations and all income levels. Men shopping for their significant others also make up a part of the targeted customer. Due to Victoria’s Secret’s massive reach, there is really no specific age range.
When necessary, the VS age range is from 18 to 49 and the Pink age range is from 13 to 21. The Victoria’s Secret target customer believes that beauty is body conscious. They are interested in indulging in personal care. The customer lives with the “look good, feel good” ideal.
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Julie Julie is a 40 year old mother who is highly invested in her career. She is the president of her company and frequently travels around the country for business. You will never find her with gray roots or split ends. She stays in the know on new designer products and carries the latest Coach handbag. Although she is always on the go, she still finds time to spend with her supportive husband and two adorable children. Her day begins at 5am to meet up with her friend at the local park for a morning jog. With such a busy schedule she prioritizes the need to unwind and destress by spending a little extra on the simple things that make her feel good.
Taylor Taylor is a third year University student. She approaches the world with confidence and cares about the way she looks. She enjoys the little things in life and spends her spare time reading novels. She spends her Saturday mornings at the farmer’s market and experiments with new clean eating recipes. You can find her in the mornings biking to her pilates studio with a Starbucks green tea in hand. She splurges on herself at Sephora and her bathtub is surrounded by Lush products.
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Product Range
Beauty (Perfumes, Body Lotions, Lipcare) Intimates (range from lounge to lingerie) Sport (athletic and lounge) Sleepwear Swim
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The customer visits a Victoria’s Secret location not just to shop for lingerie, they visit for the complete experience. Once a customer shops at Victoria’s Secret, they become devoted and therefore loyal to the brand and the products. Victoria’s Secret is constantly creating new collections so that every time the customer enters a VS store, something new is on display. As with the new collections, Victoria’s Secret is always evolving with the current trend in order to stay on top.
Strengths 20
Victoria’s Secret Sport VSX
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CALIA by Car rie Underwood Carrie Underwood is a role model for many women Women desire legs like Carrie’s Collection is sold in Dick’s Sporting Goods
Competitors 24
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LULULEMON Like Victoria’s Secret, Lululemon creates an experience for the customer Visual of the store is aesthetically pleasing
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FABLETICS Kate Hudson’s Online subscription-based retailer Time-sensitive consumers can easily order Online The brand is quickly growing and recently opened Brick-and-Mortar stores in the U.S.
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NIKE Largest athletic retailer in U.S. with large percent of market share Iconic brand logo that is equated with status Forerunners in trends and technology
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ADIDAS One of the oldest and largest athletic retailers Large brand recognition and customer loyalty Focuses on sports and innovations in textiles
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PUMA X RIHANNA Pop culture and street style inspired Fashion forward Not as focused on the practicality
IVY PARK Minimalist and sporty The collection has the attitude of “The Fly Girl” Ivy Park has a hip hop aesthetic with performance wear
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SWOT Analysis
Strengths -Customer loyalty -Experience based -Exclusively focused on the woman’s body -VSX Instagram (2M Followers) -E-commerce (20% of total sales)
Weaknesses -In store product arrangement -Limited product range for activewear -Limited selling space
Opportunities -Expand product authority beyond lingerie to related product categories like activewear -Extending sizes
Threats -Many celebrities & companies introducing activewear lines -Online competition, ex: Fabletics -Big brands have a large percent of the market
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LEGGINGS
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MUSCLE TANK
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LAYERED BRA
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CROP TOP
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SHORTS
COWL NECK HOODIE
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JOGGERS
STRAPS & CUTOUTS
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MESH
LEOTARD
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BELT BRA
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Lifestyle Trends
Empowered fitness Redefining healthy Celebrating the body Body positivity Intensive fitness programs Hyper defined feminine curves
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Empowered Fitness & Redefining Healthy
Our target customer is moving away from working out to lose weight towards becoming healthy and fit both physically and mentally. Women desire to feel strong and empowered, not just outwardly attractive.
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Celebrating the Body & Body Positivity Rather than having a single body type that is desired by all, women are now embracing every body type. This goes beyond plus size acceptance. The movement truly is an acceptance of every body type, from skinny to curvy.
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Intensive Fitness Programs & Hyper Defined Feminine Curves
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Women everywhere are now choosing to engage in a strenuous fitness routine. This is becoming a lifestyle choice rather than just a hobby. A consistent regimen works women’s bodies harder, which is necessary to build the hyper defined curves that are so on trend currently. Exaggerated feminine curves are a result of pure fitness, without any surgical procedures.They are evidence that fitness is not just a hobby in modern culture, it is a personal investment.
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Evolving textiles Synthetic materials used to create more comfortable clothing Wicking fabric Fabric with built in chips to monitor heart rate, blood pressure, etc
Technology Trends 66
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The 20% increase in sales over last year is extremely aggressive because the trend for athletic wear is growing rapidly and Victoria’s Secret is still new to the athleticwear market. To compensate for the aggressive sales increase, there will be 20% taken in reductions. The monthly sales distribution was planned with Valentine’s Day in mind for February and the Semi-Annual Sale in mind for July. To prepare for the Semi-Annual Sale, we raised our reduction percent for June to 30%. This, combined with a higher sales distribution toward the end of the season, clears out the inventory for the upcoming fall.
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FASM 245 Retail Buying Simulation 6 Month Buying Plan Spring 2017 Victoria's Secret Focus Product Category: VSX Spring 2017 Plan Net Sales, Spring 2017 Est. Net Sales, Spring 2016 Plan % Last Year: Average Stock, Retail: Inventory Turnover: Planned Reductions, $: Reductions % Sales: Plan IMU %:
164400.0 137000.0 20% 76505.7 2.15 32880.0 20% 58%
(000's) Net Sales % Spring Plan BOM Stock Stock / Sales Ratio Plan EOM Stock Plan Reductions % Spring Purchases, Retail Purchases, Cost
February 29592.0 18% 79898.4 2.7 81049.2 2630.4 8% 33373.2 14183.6
March 27948.0 17% 81049.2 2.9 78912.0 4932.0 15% 30742.8 13065.7
Spring 2017 6 Month Buying Plan April May June 24660.0 24660.0 29592.0 15% 15% 18% 78912.0 78912.0 79898.4 3.2 3.2 2.7 78912.0 79898.4 69870.0 4932.0 5589.6 9864.0 15% 17% 30% 29592.0 31236.0 29427.6 12576.6 13275.3 12506.7
July 27948.0 17% 69870 2.5 67000.0 4932.0 15% 30010.0 12754.3
Spring 2017 164400.0 100% 76505.7
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32880.0 100% 184381.6 78362.2
Planned Net Sales 2017: $164,400,000 Planned % to LY: 20% Inventory Turnover: 2.15 Reduction %: 20% IMU%: 58% Average Stock: $76,505,000
The NY Flagship store is modeled very closely to the corporate buying plan since the NY store most likely accounts for a large portion of the total company’s business. Taking our corporate sales projection for 2017 and dividing it by the 993 stores in the US, the average store would do about $165,000 for 2017. The flagship store would be estimated at five times the average store’s sales, leading the sales goal for 2017 to be $825,000 for VSX. The NY flagship store should be the fastest turning store in the company, bringing in new merchandise at a fast pace. The stock-sales ratio was raised to 2.6 which is above the corporate plan to account for this faster turn of merchandise.
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FASM 245 Retail Buying Simulation 6 Month Buying Plan Spring 2017 Victoria's Secret Product Category: VSX NY Flagship Store Spring 2017 Plan Net Sales, Spring 2017 Est. Net Sales, Spring 2016 Plan % Last Year: Average Stock, Retail: Inventory Turnover: Planned Reductions, $: Reductions % Sales: Plan IMU %:
825.0 687.5 20% 321.1 2.6 165.0 20% 58%
(000's) Net Sales % Spring Plan BOM Stock Stock / Sales Ratio Plan EOM Stock Plan Reductions % Spring Purchases, Retail Purchases, Cost
February 148.5 18% 326.7 2.2 336.6 13.2 8% 171.6 72.1
March 140.3 17% 336.6 2.4 334.1 24.8 15% 162.5 68.3
Spring 2017 6 Month Buying Plan April May June 123.8 123.8 148.5 15% 15% 18% 334.1 334.1 341.6 2.7 2.7 2.3 334.1 341.6 294.5 24.8 28.1 49.5 15% 17% 30% 148.5 159.2 151.0 62.4 66.9 63.4
July 140.3 17% 294.5 2.1 280.0 24.8 15% 150.5 63.2
Spring 2017 825.0 100% 321.1
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165.0 100% 668.9 280.9
Planned Net Sales 2017: $825,000 Planned % to LY: 20% Inventory Turnover: 2.6 Reduction %: 20% IMU%: 58% Average Stock: $321,100
The Firewheel Mall location in Mequite, Texas is an average volume Victoria’s Secret Store. According to the calculations, an average store should do $165,000 for VSX in 2017. There was no obvious reason to stray from the other aspects of the corporate buying plan for this particular location.
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FASM 245 Retail Buying Simulation 6 Month Buying Plan Spring 2017 Victoria's Secret Product Category: VSX Mesquite, TX Firewheel Mall Spring 2017 Plan Net Sales, Spring 2017 Est. Net Sales, Spring 2016 Plan % Last Year: Average Stock, Retail: Inventory Turnover: Planned Reductions, $: Reductions % Sales: Plan IMU %:
165.0 137.5 20% 76.5 2.2 33.0 20% 58%
(000's) Net Sales % Spring Plan BOM Stock Stock / Sales Ratio Plan EOM Stock Plan Reductions % Spring Purchases, Retail Purchases, Cost
February 29.7 18% 80.2 2.7 81.3 2.6 8% 33.5 14.1
March 28.1 17% 81.3 2.9 79.2 5.0 15% 30.9 13.0
Spring 2017 6 Month Buying Plan April May June 24.8 24.8 29.7 15% 15% 18% 79.2 79.2 80.2 3.2 3.2 2.7 79.2 80.2 70.1 5.0 5.6 9.9 15% 17% 30% 29.7 31.4 29.5 12.5 13.2 12.4
July 28.1 17% 70.1 2.5 65.0 5.0 15% 27.9 11.7
Spring 2017 165.0 100% 76.5
33.0 100% 121.5 51.0
Planned Net Sales 2017: $165,000 Planned % to LY: 20% Inventory Turnover: 2.2 Reduction %: 20% IMU%: 58% Average Stock: $76,500
2.2
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Assortment Plans
FASM 245 Retail Buying Simulation Assortment Plans Spring 2017 Victoria's Secret Focus Product Category: VSX Planned Purchases, Retail:
Classification Leggings Muscle Tanks Bra Tops Crop Tops Shorts Cowl Neck Hoodies Joggers
$184,381,600 % Total 20% 12% 25% 10% 13% 10% 10% 100%
$ Purchases $36,876,320 $22,125,792 $46,095,400 $18,438,160 $23,969,608 $18,438,160 $18,438,160 $184,381,600
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Assortment Plans
Leggings Planned Total Purchases Sizes % XS 20% S 25% M 33% L 27% XL 15% 100%
$36,876,320 $ Purchases $7,375,264 $9,219,080 $12,169,186 $9,956,606 $5,531,448 $36,876,320
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Bra Tops Planned Total Purchases Sizes % 32 (A-DD) 23% 34 (A-DD) 32% 36 (A-DD) 28% 38 (A-DD) 17% 100% Bra Tops Planned Total Purchases Sizes % XS 20% S 25% M 33% L 27% XL 15% 100%
$29,962,010 $ Purchases $6,891,262 $9,587,843 $8,389,363 $5,093,542 $29,962,010
$16,133,390 $ Purchases $3,226,678 $4,033,348 $5,324,019 $4,356,015 $2,420,009 $16,133,390
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Opportunity Statement
Victoria’s Secret has an opportunity to expand their Sport collection to account for a very large percentage of their overall business. The athleticwear sector of the marketplace is exploding at a rapid rate and consumers form across the nation are seeking to buy more athletic clothing from brands they already love. Victoria’s Secret Sport has the potential to grow to a half-billion-dollar business.
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www.wgsn.com www.wwd.com www.vogue.com www.victoriassecret.com www.businessinsider.com
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Jenna Hepp & Savannah Weghorst FASM 245 Retail Buying Simulation Professor Daniel Green Fall 2016
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