Source: Victoria Secret
Recently, the fashion retail sector has seen significant strategic adjustments. Victoria’s Secret & Co. and those in the market targeting Gen Alpha, are actively discerning the needs of young consumers and making every effort to lay out future business growth plans.
Victoria’s Secret & Co.’s Strategic Transformation Aims at the Gen Z Market
Under the leadership of the new CEO, Hillary Super, Victoria’s Secret & Co. recently released its remarkable Q3 financial report. The data shows that net sales soared by 6.5% year - over - year, reaching $1.3 billion, and comparable sales increased by 3%, marking the strongest quarterly sales growth in three years. Although the gross margin was relatively stable and the net loss expanded, the company significantly raised its annual performance expectations based on the current favorable development trend. It is expected that sales will grow by 1% - 2%, and the adjusted operating income is expected to reach $315 million to $345 million.
In terms of strategic layout, the company will focus on Gen Z consumers, striving to distinguish between the two brands, Victoria’s Secret and Pink, which merged in 2022. The Pink brand will undergo a comprehensive upgrade. Not only will more clothing styles be added to the product category to strengthen its differentiated positioning from the namesake brand, but it will also be allocated more display space to meet Gen Z’s preference for offline experiences. Meanwhile, through major events such as the re - launch of VSX and the return of the fashion show, as well as marketing methods such as collaborating with celebrities and launching popular product series, the company has successfully attracted a large number of new customers, significantly enhancing its brand influence.
In China, Gen Z consumers also demonstrate strong consumption potential. They have grown up in an era of rapid economic development and the popularization of the Internet in China, with more diverse and personalized consumption concepts. In the fashion field, they no longer simply pursue brand popularity but pay more attention to the design, quality of products, and their fit with their own personalities. For example, some domestic fashion brands that combine unique designs with innovative interpretations of traditional Chinese culture are deeply loved by Gen Z. They are enthusiastic about sharing their outfits and shopping experiences on social media, forming a powerful word - of - mouth communication effect. At the same time, Chinese Gen Z also has a strong passion for offline experiential consumption. Beauty collection stores, trendy toy stores, etc. often become places for their socializing and entertainment.
The Rise of Gen Alpha Reshapes the Consumer Market Landscape
Gen Alpha, born between 2009 and 2024, although young, has already demonstrated strong consumption influence. Growing up in the digital age, they spend an average of 4.44 hours a day accessing entertainment, information, and products through various apps on mobile phones and tablets. They pay close attention to technological and environmental issues, and their consumption habits are quietly changing the market landscape.
Gen Alpha has a non - negligible impact on family consumption decisions. 85% of parents admit that their children’s preferences can influence their purchasing intentions. In terms of brand recognition, they can identify brand logos as early as the age of 5, and 76% of children aged 6 - 9 already own mobile phones. Influenced by them, profound changes have taken place in the consumer market in terms of social justice, environmental sustainability, etc., such as the rise of second - hand trading platforms and the development of the gender - neutral trend in the fashion field. In addition, in the fields of e - sports and entertainment, Gen Alpha also shows unique consumption demands, promoting the wide application of technologies such as AI and virtual reality in related industries.
Correspondingly, in China, consumers of this age group also show distinct characteristics under the influence of the digital environment. They have been exposed to various smart devices since childhood and have a high acceptance of digital content. Short - video platforms and children - specific games have become part of their daily lives. In family consumption decisions, they also play an important role. Many parents will fully consider their children’s opinions when purchasing children’s products or family travel products. Moreover, with the popularization of environmental protection education, Chinese Gen Alpha consumers also have a certain understanding of environmental protection concepts. They tend to choose products made of environmentally friendly materials when selecting toys and stationery.
As Gen Z and Gen Alpha gradually become the core forces in the consumer market, the strategic adjustments of various brands are not only a positive response to the current market demands but also a way to gain the upper hand in the fierce market competition in the future. Victoria’s Secret & Co.’s precise layout in the Gen Z market and the consumption changes led by Gen Alpha undoubtedly provide valuable development references for the entire industry. The innovation and transformation of the future consumer market are worthy of our continuous attention.
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