After testing the waters with its beauty products, U.S. lingerie company Victoria’s Secret is taking the plunge in the China market with its first fully stocked mainland China store.
According to a report by China Daily, the brand known for its annual supermodel-studded runway spectacular will be replacing Louis Vuitton in a store on Shanghai’s Huaihai Road, where it will be directly across from the Hermès Maison store. Attached to the Lippo Plaza shopping center, the 1,475-square-meter store is expected to be “open by the end of this year,” depending on how quickly the imported goods clear customs.
Parent company L Brands decided to expose Chinese consumers to Victoria’s Secret initially through its range of beauty products, opening a line of “Victoria’s Secret Beauty and Accessories” stores in 2015. The brand says sales are doing well and is expanding rapidly, with a total of 27 stores on the mainland and plans for more in 2016. In addition to Shanghai, CEO Les Wexner stated in November 2015 that there will also be a full flagship store in Chengdu.
The brand is bringing its main staple to the China market at a time when demand for lingerie is growing rapidly and foreign labels are quickly expanding. In addition to Victoria’s Secret, French competitor Etam also recently opened its first mainland store in Shanghai, while higher-end labels Agent Provocateur and La Perla have been expanding in China. At a time when growth is slowing for traditional luxury retailers, the lingerie industry has caused luxury lingerie brands to see significant China growth. Valued at $20 billion in 2014, the industry is growing at an estimated 18 percent annually.
While China’s growing middle class is a major reason for the boom, the high end is doing just as well—La Perla saw 42 percent Greater China sales growth last year and just opened a Shanghai men’s store that sells boxers for $200 and silk robes for $3,000. Meanwhile, Agent Provocateur, which sells bras for over $200, said sales at its four China stores were 25 percent above its expectations. It is yet to be seen what the “China price” of a typical bra will be at Victoria’s Secret due to tariffs, but the ritzy Shanghai location implies it may be aiming for a more upscale market than the middle-class suburbanites it reaches in America.
Foreign lingerie brands’ marketing has shown their strong interest in the China market. For several years, Victoria’s Secret has been featuring Chinese supermodels including Liu Wen, Sui He, and Ming Xi in its televised fashion show extravaganza, while Liu Wen has also appeared in advertisements for La Perla.