Fashion
VS CEO Says It Will Be ‘A Tough December’
Victoria’s Secret is gearing up in the race to attract consumers this holiday shopping season.
“We’re in for a tough December all around across retail and we need to be prepared to sharpen our elbows and fight as hard as we can,” Martin Waters, chief executive officer of Victoria’s Secret & Co., told analysts during Thursday morning’s conference call.
The lingerie and beauty retailer’s game plan includes increased promotions, an expanded assortment, more Stores of the Future and the recent addition of Adore Me to the company’s portfolio, all with an emphasis that shoppers may have less money to spend this year.
“We remain mindful of the continued economic headwinds and pressure on our customer that will likely drive a highly promotional retail environment,” Waters explained. “As such, we expect continued sales and margin volatility. We made the decision that it was appropriate to be more promotional than we had been in the previous year, to be more promotional than we have been in the balance of Q3 in order to make sure that we were fighting as hard as we possibly could. And we feel good about that choice.
“In these difficult times, she is looking for a deal and she’s looking for help; she’s looking at the best brands in the market to recognize that times are difficult and to give her a helping hand,” he continued. “[But] since Black Friday, our customers have responded positively and we’ve been very pleased with an uptick in the trend and our level of performance. Customers were out over Black Friday weekend and they’re stocking up, looking to buy Christmas gifts.”
The CEO spoke with analysts just one day after releasing quarterly earnings results that fell short on both top and bottom lines thanks to consistent inflation and price-conscious shoppers.
Waters was quick to point out additional obstacles, too, such as inventory challenges and a more rigid-than-normal future purchasing budget.
“But where [pressure] really bites is in our ability to enter a new season open,” Waters said, referring to the firm’s ability to purchase inventory in advance. “When the business is at its best, we would start the fall season about 60 percent bought and about 40 percent open. We didn’t get quite back to that level this fall. We were more like 70 percent bought, 30 percent open. But we don’t get to spend. That 30 percent is open because with the economic outlook, the way that it is, and sales being pressured, it would be unwise to spend those open dollars. So we’re more like 80-20, 80 percent committed, 20 percent open.”
The company guided its current quarter and full-year outlook down as a result. Victoria’s Secret is now anticipating fourth-quarter net sales to be down in the high-single digit range, compared with 2021’s fourth-quarter net sales of $2.1 billion, while the firm expects full-year net sales will decline 6 percent to 7 percent, compared with 2021’s full-year net sales of $6.78 billion.
“Our guidance for the quarter reflects our results to date and the expectations that we’ll need to be aggressive in December to get our fair share and more of consumer spending this holiday season,” Waters said. “Because as I said before, it’s not just about winning within our category, it’s about taking dollars to our category rather than to somebody else’s. We’re committed to optimizing our performance in the current challenging environment by focusing on what’s within our control: our brand transformation being best at bras, enhancing the customer experience and a relentless focus on costs and inventory management.”
But Waters also pointed to several potential tailwinds on the horizon, such as the likelihood of lowered freight costs next spring, fewer supply chain bottlenecks, the firm’s beauty business and the international segment.
“I think we’re holding our own,” he said. “December is the most important month of the year. We feel very well set up in terms of inventory, in terms of promotions, in terms of the activity we’ve got in the pipe. So it’s all focused on execution right now. That’s what we get paid to do and that’s what we’re focused on.”
In regards to the Adore Me acquisition, Waters said: “It’s a terrific company. [Internally], we talk about [the acquisition] as being a 2-for-1 deal. It’s a stand-alone business that is incredibly successful and growing. And [it is] pointing at the value sector of the market that we don’t currently compete in and that gives us a great source of growth. And secondly, it’s a technology company where we can leverage some of their great capability and skill set inside of our larger base of customers. And so there are two very good reasons for us to be a good owner for that brand.”
The transaction is expected to close in January.
Despite Water’s bullishness, investors were not convinced. Shares of Victoria’s Secret fell more than 7 percent at the start of Thursday’s session.
Analysts, however, were a little bit more optimistic.
“[Third-quarter earnings-per-share] beat on better-than-consensus [gross margins], with management flagging improving traffic [and] conversion over the Black Friday-Cyber Monday period, while still suggesting willingness ‘to be aggressive in getting our fair share of consumer spending’ across what they expect will prove a competitive rest of 4Q,” Simeon Siegel, managing director at BMO Capital Markets, wrote in a note. “Bottom line: we continue to see self-help opportunity on [gross margins] and believe shares are cheap.”
His firm rated the stock “outperform” and set a $53 price target.
Ike Boruchow, senior retail analyst at Wells Fargo, rated Victoria’s Secret’s stock “overweight” and set a price target of $55.
“With management indicating that momentum into holiday was picking up (and 70 percent of 4Q sales to still be booked), inventory still headed in the right direction (guiding +MSDs exiting the year), we continue to see value out of VSCO,” Boruchow wrote in a note. “Following 3Q’s [negative] 11 percent comp trend, business persisted at that level ahead of Black Friday week, with the trend accelerating (traffic and conversion) in stores and online over that key holiday kickoff, giving VSCO more confidence in their 4Q plan as the consumer responded to Black Friday/Cyber Monday promotions (i.e., 4Q [average unit retail] planned down [year-over-year]). While there’s a lot of business yet to come (70 percent of quarter yet to be booked), we’re encouraged at the building momentum, especially with better in-stocks in key holiday categories [year-over-year], boding better for conversion and basket building.”
Reports /TrainViral/
Continue Reading
GIGI, PART DEUX: Gigi Hadid’s collaboration with Self-Portrait continues, as she appears in the brand’s latest fall 2023 campaign shot in Paris by British photographer Tyrone Lebon and styled by Marie Chaix.
The contemporary fashion label, which counts Kate Middleton, Naomi Campbell, Jennifer Coolidge and Blackpink among its fans, had worked with Hadid in London and New York on previous campaigns, and according to Han Chong, brand founder and creative director, “it felt only right that we join her in Paris for our latest campaign shoot against a backdrop renowned for elegance and romance.”
In one of the shots from the campaign, Hadid poses behind a grand classical wrought iron balcony while wearing a fuchsia tweed jacket with a matching bar top and a pleated skirt from the brand’s fall 2023 collection. In a separate image, Hadid gazes down at the camera in a sequined asymmetric aquamarine dress.
Commenting on the latest campaign, Chong praised Hadid as “everything the modern Self-Portrait woman stands for — free, spirited, and joyful.”
“Being able to shoot in Paris is always such a dream…it’s one of my favorite cities in the world, filled with so much charm and magic. And to be able to shoot with the Self-Portrait team who have become such incredible partners and friends, made it an even more memorable experience,” Hadid added.
Launching together with the release of the campaign, the fall 2023 collection will hit stores worldwide from Tuesday.
For fall, Chong offered a balanced collection that caters to both the sensual new vibe, as well as those who buy into straightforward pretty, and elegant outfits for their everyday lives.
Standouts in the collection included sequinned, embellished high-glam evening options, many of which came with sleeves, a detail that’s appreciated in the modest community.
The denim pieces were cut for a younger and cooler audience, while the abundant supply of tweed jackets and coordinated bra tops and skirts have already won over fans including Selena Gomez, Princess Beatrice and Zhao Liying, Self-Portrait’s first Chinese brand ambassador. — TIANWEI ZHANG
JUMPING THE GUN: Kirsten Dunst couldn’t help herself from leaking the news about her upcoming collaboration with Coach when actress and comedian Ayo Edebiri was spotted wearing pieces from the Observed by Us x Coach line.
The actress shared the news on Instagram with an image showing Edebiri wearing a white top with dinosaurs on it.
The collection, which will be released to the rest of the world on Wednesday, features ready-to-wear, bags, footwear and accessories printed and embellished with original, hand-drawn illustrations by Jessica Herschko, a Los Angeles-based illustrator and designer of Observed by Us, and Dunst.
Coach creative director Stuart Vevers worked with the duo to create the line of T-shirts, hoodies, floral dresses and jeans whose inspiration was based on pieces found in Dunst’s closet. Key pieces include a wool pointelle crop top, overalls and a straw hat — each printed and embellished with original, hand-drawn illustrations by Herschko. Additionally, the pieces feature “storypatches,” a signature of Coach, in Herschko’s handwriting that tell the stories of illustrations in the collection.
“Creating this collection with Kirsten and Jessica was delightful,” said Vevers. “We got to celebrate our shared love of imagination and playfulness. Kirsten, and her style, have often been an inspiration for me. So to design alongside her and Jessica — and to blend their vivid storytelling and color with our own American heritage design language and craftsmanship — was really inspiring.”
Vevers added that he was introduced to the duo by a mutual friend and the collaboration “evolved quite naturally from there. I was immediately drawn to Jessica’s illustrations and their imaginative use of color and playful themes, but also to the way Kirsten and Jessica joyfully celebrate the beauty in the everyday — a theme I love to explore also. The collection is charming and pretty. The idiosyncratic embellishments feel both personal and expressive. There’s also a found quality and vintage feel that adds a sense of ease and cool.”
Vevers said what he likes most about working with other brands is that it allows him to try something new. “Every collaboration I’ve done is different,” he said. “I think that’s what I enjoy most about collaboration — it’s about trying something new, and working with someone else can give me a chance to challenge myself. Whether it’s with heroes of mine, contemporary artists or iconic imagery it’s also about an element of surprise. Something I’ve not done before.”
“We started Observed by Us to create clothing and other items with images that evoke a special, happy feeling and a sense of appreciation for both the natural and the man made,” said Herschko. “It was very fun to collaborate with Coach because, much like us, they see a world of possibility in the small details and have the ability to execute that perfectly.”
The collection will range in price from $20 to $595 and will be sold on the Coach website as well as in select Coach stores. — JEAN E. PALMIERI
Reports /TrainViral/
Four hundred guests will attend the spring 2024 show, where models will walk the runway in tropical print bikinis, shirts and seersucker suits. Yes, there will be Beach Boys on the soundtrack, as well as Beyoncé, and cocktails will be served — grapefruit basil martinis, which will be the featured drink at the new Tommy Bahama Miramonte Resort & Spa opening later this year in Indian Wells, California.
An unlikely product of the Pacific Northwest, Tommy Bahama was founded in 1992 by Bob Emfield and Tony Margolis, two garment business veterans who met in Seattle in the ’70s, when they were sales reps for Brittania Sportswear Ltd. The company is named after a character they invented after buying houses on Florida’s Gulf Coast, where they dreamed of living life as one long weekend.
Now owned by Oxford Industries, Tommy Bahama — which delivered top-line growth of 5 percent in the first quarter — has become a lifestyle empire that extends from coast to coast and now includes clothing and licensed accessories, home products such as rugs, bedding and upholstered furniture, restaurants — and soon, a hotel.
There’s a unified vision for it all.
For spring 2024, St. Barths was the seasonal inspiration for the 60-member design team based in Seattle, who travel to vacation locations for research trips. On the mood board are photos of the island’s red roofs, sunshine yellow mini Mokes, leafy patios and deep blue infinity pools.
“When I first started, the men’s, women’s and accessories teams didn’t really connect very much on the beginning of the season, and they all looked very different. So we started creating a seasonal destination,” explained design director Bradley O’Brien, who joined in 2014 after a decade at Ralph Lauren, four years at Old Navy, six at Lands’ End and four at Sperry Top-Sider. “We look at everything, from the architecture to the culture to the food and the artisans. We get a lot of inspiration from handicrafts, and flora and fauna of the particular area. We take lots and lots of photos and pull together concepts for the art department that really influences the color and the prints.”
The men’s and women’s collection will feature lots of novelty dresses, including a new Johnny Collar style; linen suiting; seersucker tops, skorts, bombers and blazers; swimwear, and stretch denim with sun protection. (Tommy Bahama has seals of approval from the Skin Cancer Foundation, and has raised more than $500,000 for the organization in its stores.)
“The great part about a runway is it’s not necessarily the real way, and so you can put things out there and style them in a way that makes people think, ‘Oh, I never thought of that.’ Like pairing a linen suit with a bikini,” she said.
The brand’s customer demographic is age 35 to 60, with the sweet spot in their 40s and 50s, and the women’s business is now growing faster than men’s. As a percentage of sales over the last five years, women’s has grown 53 percent, while men’s has grown 22 percent.
Dresses and knits are the two biggest categories and, surprisingly, women’s suiting is not far behind. ‘We’ve always done linen suiting for men and we can’t even keep it in stock now. There’s definitely a trend happening in women’s as well all around the blazer and the suit. So this is the first time that we’ll be offering really great suiting for her as well.”
Performancewear under the Island Zone franchise has also been key to the brand’s success, and the spring 2024 collection is taking inspiration from “court and course,” with clothing that can be worn from the golf course to the pickleball court.
“The fabrics keep you dry, they stretch, they’ve got great details, pockets and things that help you stay active,” said O’Brien, adding that the Palm Coast Polo is a top seller.
The brand has also hit with a woven fabric that’s perforated, used for camp shirts. “It looks like a silk camp shirt but it performs really well, is super lightweight and stretches and keeps you dry. It’s been so popular, we’re introducing it for women. That’s what’s fun about being a dual gender brand.”
Spring will also mark the debut of a performance seersucker fabric, alongside a traditional woven one, leaning into fashion’s return to prep and the old money trend.
“We absolutely look at the runway in the beginning of the season, and scour through some of the shows of the tried and true brands. Then we put it through the Tommy Bahama filters.…Our guest is not about fast fashion but wants to be relevant. And so if puff sleeves are definitely trending, we might put a puff sleeve on something that we already know she knows and loves in a fabrication that she already has in her closet to get her to buy into a new version.”
What are the Tommy Bahama filters?
“We talk about quality, artistry and craftsmanship, and especially in the imagery, we always want to show up looking like sun and sea and sky and sand. And then when it comes down to the product itself, it has to be effortless. Sometimes things will have one or two details too many.…You just want to be able to throw something on and feel super comfortable and relaxed,” O’Brien said. “And then the last thing that we say is we always want to have ‘a sprinkle of sand.’ It’s just a cute detail that makes the customer smile.”
For some fresh inspiration, the brand has partnered with the New York-based nonprofit Fashion Scholarship Fund on a design contest, and on Wednesday will award three $15,000 scholarships to students whose work will be included in the 2024 Tommy Bahama Artist Series.
“They’ll be representing their artwork and will have their apparel on mannequins, and everybody will be able to meet them and understand the inspiration,” O’Brien said. “Coming from the East Coast, and having a career at brands that are household names, I wanted Tommy Bahama to be a household name. And what better way than to gain awareness and recognition with these students? We just launched an internship program as well…so the talent of tomorrow wants to come and work here, too.”
One of the female executive’s proudest achievements has been elevating Tommy Bahama’s women’s profile. “It’s nice to see the perception is shifting,” said O’Brien, who favors the brand’s dresses, jeans and flirty tops for work. “And when you’re in stores, you also see families coming in. So it’s definitely a brand the entire family engages with.”
That’s thanks also to the Tommy Bahama Marlin Bars, which debuted way ahead of the latest wave of fashion-fronted restaurants like the Polo Bar and Tiffany Blue Box Café. Three more Marlin Bars are opening on the horizon.
“We do see that the stores that are attached to those, the sales are really, really strong in those doors. So the guest likes to come in and enjoy being a part of the brand and then shop it as well,” she said.
Soon they can also be able to live it at the Tommy Bahama Miramonte Resort & Spa, opening in November outside of Palm Springs, California, with 215 rooms, three pools, and a 12,000-square-foot spa.
“That’s going to be a big moment,” O’Brien said. “I was lucky enough to work with our home wallpaper and fabric licensee to help pick out all the fabrics and wallpapers for each of the suites and the rooms. And we are going to have our artists go down and create signature murals for them.”
The hotel property will feature a 1,200-square-foot retail store, even though it’s within miles of Tommy Bahama stores in both Palm Springs and Palm Desert. O’Brien said, “We’re thinking of it more as a lab, where we can test elevated product.”
Tommy for the big 4.0.
Reports /TrainViral/
World2 months ago
Father of five blasted for leashing kids, gives them odd nickname
World2 months ago
This heartwarming prom story goes viral again and we all understand why
World3 months ago
Simon Cowell Won’t Leave Son His $600 M Fortune; Says If He or Future Children Wants to “Start a Business … I’ll Invest. They Aren’t Getting Trusts”
Fashion2 years ago
Five wedding outfits for just £29!
Politics2 years ago
Mikhail Gorbachev changed history
Politics2 years ago
Tracking the war with Russia
-
Fashion2 years agoFive wedding outfits for just £29!
-
Politics2 years agoMikhail Gorbachev changed history
-
Politics2 years agoTracking the war with Russia
-
Everything About Youtube2 years agoThe Twitter Artist who makes a Fortune off YouTube Thumbnails while Studying.
-
Fashion2 years agoOn presents first ever shoe made from carbon
-
Politics2 years agoCharles is announced to be the new King
-
Tech2 years agoThe rise of the AI artists stirs debate
-
Everything About Youtube2 years agoEveryone knows YouTube, but not how it works.