Iconic pink glass façade. Dimly-lit den of mirrors and marble. A crystal-encrusted staircase. Enough to attract hordes of fashion-conscious, modern-minded women consumers into shopping for intimate bralettes.
US lingerie giant Victoria's Secret has finally made a full landing in China. Right under the corporate logo on its website, "Shanghai" sits beside "New York, London", indicating the global brand's three biggest centers on the planet now.
Shanghai women can buy the signature VS pushup bras and frilly panties from the four-story flagship store. The brand has also forayed into Chengdu, Sichuan province, in Southwest China.
News of the China operations of the mid-to-upper tier brand, a long-standing fashion barometer for intimate apparel, went viral over the country's digital space, thanks to its live-streamed annual catwalk show.
But cautious steps have marked VS' progress in the physical realm in the world's largest consumer market. The brand had reached China three years ago, selling only its accessories, fragrances and beauty products through concept stores.
After getting a hang of the market, the Columbus, Ohio-based retailer announced last year it will acquire all of the 26 shops from its franchise partner in China to build a wholly-owned model.
Market observers said that might be part of a turnaround plan of L Brands' Inc, the parent of VS, to prevent the lingerie chain from a continued downward trajectory.
With VS generating 70 percent of L Brand's total revenue, the company singled out "continued investment in China" as a key factor in its earnings forecast.
Sales were hit hard since late 2015 as the brand faced dramatic customer behavior changes, from the emergence of athleisure selections to better bra offerings. To this end, an overhaul plan was rolled out, ditching swimwear and dropping its iconic catalog.
But the efforts don't appear to have paid rich dividends yet. After recording a 2-percent sales drop in the third quarter of 2016, the company said in its annual report that comparable sales are predicted to slump by 20 percent in February. The worrisome figures are creating fear that the brand's turnaround attempt is unraveling.
As VS struggled to steady itself in North America, the opening of China stores could put a silver lining on its cloud, according to Neil Wang, Frost & Sullivan Greater China president. Frost & Sullivan is a marketing firm.
"Now is a good time for VS to march into China. Compared with five years ago, consumers now have demonstrated increasing brand awareness due to the rising average education level, living standards and income level," he said.
At the Shanghai store, each piece of brassiere costs between 300 yuan ($45) and 600 yuan, at a premium to price tags in the United States or Canada.
"The higher-end segment of lingerie is enjoying rapid growth in China. If VS can win certain market share in that niche, it will be a notable remedy to its global revenue," Wang said.
China's market for women's inner wear is expected to hit $25 billion by the end of this year-double that of the US-and will grow to $33 billion by 2020, according to market research firm Euromonitor International.
Market observers say there's certainly room for more competition, given that lingerie is the least saturated segment of the Chinese retail landscape. But according to Shanghai-based business consultancy Daxue, the country's lingerie brands are highly fragmented.
For example, one can buy a bra at Cosmo Lady, a mass lingerie brand, from around 50 yuan, or spend 100 times that amount to purchase a bra set at Italian luxury brand La Perla.
Euromonitor International's research found that the country's top ten lingerie producers commanded just around 13 percent share of the market. The sector comprises thousands of little known players that sell low-priced items.
So, apart from a strong branding push, VS is less prepared than people would imagine to navigate through what is perhaps the world's most complicated consumer market, where shopping preferences differ from, and change faster than, their Western peers, said Benny Lam, chief executive officer of Emperor Textile Co Ltd, an industry veteran and a supplier of VS.
"One pain point is the lack of local designs. Buying a bra isn't all to do with size, given that the shapes of breasts are incredibly varied between women in the East and the West. So you can't just bring in whatever you sell in the US-it won't work in the long run," he said.
Meanwhile, Chinese consumers tend to have a much more functional orientation toward lingerie and underwear, eclipsing blinged-out bras and lace undergarments that are popular in the US.
A bigger challenge, however, lies in redefining the traditional notion of beauty and sexiness, putting the brand in real danger of losing relevance among young Chinese women.
The millennials, already the big disruptors of other retail trends, lead the demand for athleisure, a casual comfort trend that has penetrated the underwear industry and appeals to all age groups, according to research group NPD.
The dazzling, over-the-top fantasy featured by VS might not be a perfect fit for sophisticated young women here in China, Lam said.
"They can be freer-spenders, but they can also pick up really cheap panties for fun. The right thing for VS is to choose the right raw materials for Chinese women and react fast to the market," he said.Read more at:http://www.marieprom.co.uk/cheap-prom-dresses-uk | http://www.marieprom.co.uk/prom-dresses-2016-2017
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