LB L Brands Inc

By Khadeeja Safdar 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (September 11, 2019).

COLUMBUS, Ohio -- Make room, Gigi Hadid. Victoria's Secret will no longer rely on a small group of supermodels to promote its sexy lingerie, as the chain shifts to more inclusive marketing to end a prolonged sales slump.

Victoria's Secret's emphasis on supermodel "Angels" wearing padded bras has alienated some women and invited criticism that the brand is out of touch. Demand for its bras has cooled as customers have turned to brands using unretouched images featuring women of more shapes and sizes.

Last month, Edward Razek, the marketing chief behind the brand's overtly sexual marketing, said he was resigning after more than 30 years at the chain. Earlier this year, the company said it would no longer air its annual fashion show on network television.

At an investor meeting here Tuesday, executives showed new videos for Victoria's Secret and its teen brand Pink featuring a more diverse set of women than the company has used in the past, including curvier models. Pink also recently hired a transgender model. They are "real girls," said Pink Chief Executive Amy Hauk, referring to the new videos and imagery. "I love the diversity."

Victoria's Secret Lingerie CEO John Mehas, who joined recently from Tory Burch, said he began changing the marketing just a few weeks ago. He plans to accelerate the changes, including messaging that responds to the #MeToo movement. One of the messages in the new marketing is "by her, for her," he said. "There is a big belief in the company that we need to evolve."

In a Vogue interview last year, Mr. Razek said he didn't think the Victoria's Secret fashion show should include transgender models because it is supposed to be "a fantasy," prompting backlash from some consumers. Several former executives told The Wall Street Journal that the 71-year-old executive's leadership was preventing the company from evolving. L Brands declined to make Mr. Razek available for comment when he left.

At the start of Tuesday's meeting, Leslie Wexner, longtime CEO of the retailer's parent, L Brands Inc., addressed his relationship with his former financial adviser, Jeffrey Epstein, seeking to reassure investors that he isn't distracted. "The distraction of that was something that happened a long time ago," he told investors.

He said he feels enormous regret that Mr. Epstein took advantage of so many young women and said his former adviser was living a secret life. "We are all betrayed by friends," he said.

Mr. Epstein, who was in custody awaiting trial on federal sex-trafficking charges, died last month by what the New York medical examiner's office determined was a suicide. The board of L Brands hired a law firm over the summer to investigate Mr. Epstein's involvement in the company.

In August, Mr. Wexner, a billionaire, revealed in a letter to his charity that Mr. Epstein had misappropriated some of his wealth. The Wexners have been providing information to investigators who are looking into the source of Mr. Epstein's wealth, the Journal has reported.

Victoria's Secret has posted several quarters of sales declines. The mall stalwart accounted for $7.4 billion of annual sales at L Brands, which also owns the Bath & Body Works chain.

L Brands executives said the company's long-term goal -- consistent growth in sales and operating-income dollars in the mid-to-high single-digit percent -- assumes performance at Victoria's Secret will improve.

The company, which has closed about 10 to 30 Victoria's Secret stores annually from 2015 to 2018, accelerated closures at the brand to about 55 in fiscal 2019 and plans to close 40 to 60 in 2020. The company has more than 1,400 U.S. stores, including Bath & Body Works locations.

Write to Khadeeja Safdar at khadeeja.safdar@wsj.com

(END) Dow Jones Newswires

September 11, 2019 02:47 ET (06:47 GMT)

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