OVERVIEW OF EVENT AND CORPORATION- BACKGROUND
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1 Hailey Manchee, Kelley Still, Nicole Walter & Alexandra Zumpano BEMP 504 Mike Dover October 7 th, 2013
2 EXECUTIVE SUMMARY As a leader in the lingerie and intimate apparel industry, Victoria s Secret has grown to encompass the Canadian market. In order to expand larger and sell better, we are proposing that the renowned fashion show be brought to Toronto, Ontario. This market analysis discusses the potential cost, marketing and branding benefits of bringing The Victoria s Secret Fashion Show to Canada. Demographically, Toronto is a prime destination to bring The VS Fashion Show. With a female ratio of 52.0 %, a young working- age population (25-44 years old) of 30.6% and a population reaching almost 3 million people, The VS Fashion Show would benefit from Toronto s fast- paced environment and readily available younger female consumers (Statistics Canada Census). The Toronto VS Fashion Show will use marketing techniques that Victoria s Secret has successfully mastered over the years to promote the event: bold advertising, well- known supermodels, celebrity performers and a- list attendees. Additionally, this analysis will outline new marketing strategies that will be implemented to promote the event and increase sales in the Canadian market. OVERVIEW OF EVENT AND CORPORATION- BACKGROUND Victoria s Secret Victoria s Secret is one of the largest and most recognized lingerie brands in the United States and Canada. Specializing in lingerie, swimwear, sleepwear and beauty products, Victoria s Secret has successfully developed a brand that empowers women to feel sexy and glamorous while wearing their intimate apparel. Victoria s Secret is the largest subsidiary of Limited Brands Incorporated, whose other businesses include, Victoria s Secret PINK, Bath and Body Works, LaSenza, and Henri Bendel. In 2012, Limited Brands had annual sales of $10.4 billion; Victoria s Secret contributed $6.12 billion to this revenue making the company the number 1 retailers of women s intimate apparel (Yang, 2012) In recent years, competitive brands like AdoreMe, Intimint, and True & Co. have sought to knock Victoria s Secret off its pedestal by luring customers with more affordable prices. However, Victoria s Secret focus on providing exceptional customer service and a luxury shopping experience have kept the company a leader in the industry. Victoria s Secret price points remain higher than their competitive brands, however consumers are willing to pay extra for the luxury experience they feel when purchasing their product. The Victoria s Secret Fashion Show The Victoria s Secret Fashion show is an annual fashion show sponsored by Victoria s Secret. The event is used to market and promote the company s merchandises in a lavish and extremely high- profiled show. Hundreds of celebrities and prominent fashion figures attend the event, and the show is broadcasted live over prime- time television. The fashion show is Victoria s Secret largest and most successful marketing campaign, reaching 9 million viewers in Each year, renowned supermodels are deemed Victoria s Secret Angels and are featured throughout the fashion show 1
3 wearing specially designed, one- of- a- kind angel wings. Over the years, the angel wings have become a synonymous part of the Victoria s Secret Fashion show and the Victoria s Secret brand. A well- known celebrity entertainer is chosen to perform at the show each year and the most popular celebrities sit front row at the show. Not only is The Victoria s Secret Fashion show a way for the company to promote their products, but it also helps solidify their brand as a luxury by utilizing popular media and celebrities. MARKETING PLAN ELEMENTS Victoria s Secret has managed to do what most companies cannot dream of, they ve successfully branded themselves as a lifestyle, synonymous with all things feminine and sexy (Secret, 2013). The brand has launched itself to the forefront of lingerie stores and continues to expand with no end in sight. They introduced Victoria s Secret Pink, a collegiate loungewear and lingerie line in 2004, followed by swimwear, sportswear, and a full line of body care and fragrances (Newsom, 2013). (See Figure 1). Although the first Canadian Victoria s Secret retail outlet didn t open until August 2010 (Flavelle, 2010), the lingerie company was no secret to the Canadian market. Canadian shoppers could purchase freely through the Victoria s Secret online store, or through their mail- out catalogue, and have their product shipped to Canada after paying an increased shipping fee (Talamazan, 2013). Just three years after the opening of their first outlet outside of the United States, in the iconic West Edmonton Mall, Victoria s Secret operates 34 stores across Canada, spread over 7 provinces. Combined with unlimited purchasing possibilities through ecommerce, its fair to say Victoria s Secret has arrived on the Canadian lingerie scene. August 2013 Figure 1: Example of a Victoria's Secret PINK store saw Victoria s Secret open their 2nd largest store in the world in downtown Vancouver, B.C. It boasts 35,000 square feet of retail space, home to lingerie, swimwear, sport and lounge wear as well as fragrance and body care collections (Talamazan, 2013). Victoria s Secret appeals to a wide target market as the brand carries a wide range in products. Specifically, Victoria s Secret s target market is middle class women from ages who 2
4 desire a luxury shopping experience and can afford Victoria s Secret prices. These women are likely buying lingerie or other VS products for themselves. Victoria s Secret Pink, however, is marketed to a younger, teenage crowd the company deems collegiate age, around 18 years old or even younger (Flavelle, 2010). (See Figure 2). The CFO of Victoria s Secret said of Pink, "When somebody's 15 or 16 years old, what do they want to be? They want to be older, and Figure 2: Interior of a PINK store- appealing to a younger consumer they want to be cool like the girl in college, and that's part of the magic of what we do at PINK" (Newsom, 2013). When it comes to target market, we mustn t rule out those don t wear lingerie: men. After all, Victoria s Secret was designed by Roy Raymond for the purpose of making men feel comfortable entering a lingerie store to purchase for their significant others (Webley, 2012). This is even more accurate today; with the ease of catalogue buying and ecommerce, men don t even have to enter a retail location in order to purchase lingerie. Also, as described in the following section, the appeal of the Victoria s Secret annual Fashion Show to male viewers. Victoria s Secret has not made their way to the top spot in the market without expensive and impeccable marketing. VS applies a multi- prong 360 degree approach to marketing, slashing competitor s efforts. The company is so profitable because of their successful branding strategy. They effectively communicate a point of difference leading to strong brand loyalty. The VS lifestyle is what their customers know, understand and trust. The lingerie company s main approach to marketing comes in stark contrast to the current trends of its competitors. With much of today s marketing focus being on digital efforts through channels like Facebook, Instagram, Twitter, and , Victoria s Secret continues to emphasize the in- store experience. Limited Brands Chief Financial Officer Stuart Burgdoerfer said in a presentation to investors that the internet doesn t drive a lot of emotional content and that Victoria s Secret would continue to emphasize the product and in- store experience above all and aren t aiming to be leaders in technology (Maheshwari, 2012). Big- name brands like The Gap and J.C. Penney Co. are moving away from traditional marketing. The Gap has moved farther into social media and away from television and print ads, whereas J.C. Penney Co. ditched their catalogue business in Victoria s Secret spent about $220 million on their mail- out catalogues in 2012, the biggest expense of its direct business. Their print and 3
5 online catalogue combined, accounted for approximately a quarter of the business in These traditional, yet profitable forms of marketing are not something they ll soon give up (Maheshwari, 2012). Although it s not their main marketing focus, Victoria s Secret does use social media successfully. The company operates a Facebook page, an Instagram account and has a very user- friendly but comprehensive website. The website has links to all of the Victoria s Secret lines, can be changed into Spanish- language, and has exclusive online deals. They even have a section linking customers to VS All Access, a blog with lifestyle tips such as yoga videos and makeup tutorials, to interviews with their supermodels, sneak peeks at upcoming products and behind the scenes looks at TV commercial and advertisement shoots. This type of blog makes customers feel as though they are part of the brand. They feel they are being given an exclusive look and with this type of branding customers are being exposed to marketing when they don t even realize. The models in the yoga videos are wearing exclusively VS active wear, the makeup tutorials feature products from the Victoria s Secret body care line, and in the interviews the supermodels discuss how they prefer to wear Victoria s Secret lingerie. With so much emphasis placed on the in- store experience, store interiors and in- store customer service are flawless and consistent. Staff are trained to deal with all types of customers, ranging from the young and trendy, to older women looking for a more comfortable fit, or to men looking to purchase something for their wives or girlfriends. The stores are consistent with Victoria s Secret image, they are made up of several rooms, each decorated differently and meant to convey a different message. Soft pink décor is used in the rooms housing everyday comfortable lingerie, but move to darker colours and the use of more black in the rooms that house sexy, specialty lingerie. Store consistency is key to the VS experience. Regardless of what VS location you enter, you will have essentially the same shopping experience, as stores are laid- out and decorated in a very consistent way. This makes both female and male customers feel comfortable entering a new or different retail location as they already know what to expect, and where to find the products they are looking for. Victoria s Secret multi- channel approach to selling their products is working. They play on women s desire to feel sophisticated and sexy with an enjoyable in- store, online and catalogue shopping experience. Their stores and customer service are exceptional and consistent, leading to strong brand loyalty, which keeps customers returning. EVENT MARKETING PLAN ELEMENTS The proposed plan is to bring the Victoria s Secret Fashion Show to Toronto, Canada. The show, which is filmed annually in New York City brought in 9.3 million viewers in 2012 (Adams, 2013) and raised sales by keeping this mass- market brand top- of- mind (Guthrie, 2011). In 2009, Limited Brands entered the Canadian market by opening Victoria s Secret stores throughout the country. To further promote and increase sales for Victoria s Secret in Canada, the runway show must be considered as a viable option. Canada has proven that there is a market demand for high- end lingerie 4
6 and by incorporating The Victoria s Secret Fashion Show as part of their marketing campaign, there is a strong potential for increased sales. Market analyst Jennifer Davis was quoted saying in regards to the current fashion show that although it may cost roughly $12 million, it pays for itself (Maheshwari, 2012). Additionally, Toronto has in recent years become a desirable location for international stars and brands. For example, the Toronto International Film Festival annually brings hundreds of movies and celebrities to Toronto for two weeks to showcase the latest in film production. TIFF continuously evolves and becomes larger each year, which proves that Toronto is an excellent choice for a large- scale productions like the VS fashion show. Therefore, the objectives of bringing the runway show to Canada are growth oriented based both on increasing the growth of the sales, profit and exposure of the brand in Canada. In order to determine a target market for a fashion show, the given company must look to whom their brand is marketed towards. The benefit of the VS Fashion Show is that it is not specifically targeted to one gender or age group. In 2012, the L.A. Times reported that the December 4 th, 2012 show was rated number one for adult viewers in ages ranging from 18 to 49 (Adams, 2013). In addition, although women made up 60% of the shows viewership in previous years there is still a large population of male viewership (Guthrie, 2011). Therefore, the target audience is primarily middle- class women in the age range of 18 to 49, as these individuals are likely to view lingerie and purchase it for themselves. However, men are also targeted as many enjoy viewing the fashion show and may purchase lingerie for their significant other (Guthrie, 2011). Every aspect of Victoria s Secret marketing campaign is aimed to promote the brand, especially through the fashion show. The originality of broadcasting a lingerie runway show for the world to view is unheard of and is a large part of their global success. Their brand positioning as the world s leading lingerie company is largely due to the first- class supermodels used in each runway show, known as the runway angels. Having these beautiful, desirable women walk the catwalk as opposed to being featured strictly in print advertisements, allows for audiences to see the women live. The runway angels have captivated audiences for decades, in addition to becoming apart of the brand. Therefore, these women are an integral part to the Canadian runway show as they are familiar faces, having their portraits in every store across Canada and will increase worldwide viewership. In addition, Victoria s Secret promotes luxury and their brand identity is to have every aspect of their company be luxurious, including the fashion show. Women feel luxurious and sexy when they walk into a Victoria s Secret store to buy products and the runway show encourages women in Canada to do so (Victor, 2011). Marketing for the first ever Canadian Victoria s Secret Fashion Show will be the most integral part of the show s success. In previous years, Facebook and Twitter have been used to draw web traffic and build excitement around new collections, as well as to bring attention to the fashion show (Maheshwari, 2012). To create awareness for the runway show in Canada, the Angel Wings Boxes, containing previously worn VS angel wings, will be placed in major cities across the country. As the angel wings are an essential part of the runway show and have been worn by many models, it is many 5
7 women s dream to wear them (Victor, 2011). Women and men will be given the opportunity to stand on a marked arrow and get their picture taken in front of the previously worn wings (See Figure 3). These photos will then be uploaded to the Victoria s Secret Facebook page in order to draw awareness of the runway show. As Victoria s Secret has over 23 million likes on Facebook, it is Figure 3: Example of customers posing with an Angel Wing Box an effective marketing strategy to make the public more aware of the upcoming event. Additionally, a contest will be held in order to win a pair of tickets to the live recording of the fashion show. In order to attract influential individuals in the fashion market, tickets will strictly be given to individuals in the fashion industry and celebrities in order to maintain the exclusive nature of the fashion show. However, fans of the brand will have the opportunity to attend as well. In order to win tickets, fans must submit a thirty- second video explaining why they love the Victoria s Secret Runway show. After video submissions have been received, ten lucky winners will have the chance to make their dreams come true by winning tickets to attend the event. This contest will be promoted through Twitter and Facebook to attract audiences and allow them the opportunity to feel involved. Finally, a Victoria s Secret Fashion show is not complete without an A- List celebrity performers. In order to attract individuals of all ages, the Canadian runway show will feature exclusively Canadian music talent. Michael Bublé, Drake and Justin Bieber will perform while the models take the catwalk. Having these celebrities perform is a marketing strategy to attract viewers, as they are able to view a free concert from their favourite Canadian performers, while watching the latest trends in lingerie modeled by beautiful women. Using these performers will increase success for the event as event promotion will increase through several media outlets including the Web, Television and Radio. EVALUATION OF EFFECTIVENESS The annual Victoria s Secret Fashion Show is a unique corporate event that meets both corporate marketing objectives and the event marketing objectives. It is the only one- hour network show dedicated to a single brand, putting the Victoria s Secret name in the faces of consumers right at the crucial holiday season (Guthrie, 2011).The VS Fashion Show meets these objectives by properly appealing to their target market with the use of attractive yet approachable models, current popular musical artists, and the mix of theatrical and practical lingerie themes. 6
8 In terms of corporate marketing objectives, Victoria s Secret aims to maintain their position as a market leader in the female lingerie industry by offer a captivating customer experience that drives long- term loyalty and sustainable growth (Limited Brands, 2013). Aware that two- thirds of the fashion show viewers and 98% of consumers are female, Victoria s Secret strategically selects models that will appeal to women (Morris, 2006). Although the Victoria s Secret models are uniquely attractive, they are still a vision that many women strive to be, generating a viewer s desire to purchase the lingerie they see on the models during the Fashion Show. In 2012, Victoria s Secret had sales of $6.12 billion, which were largely attributed by the annual Fashion Show, costing $12 million (Gerard, 2012). Victoria s Secret Fashion Show contains additional entertainment elements through live musical performances. These performances, occurring simultaneously with the fashion show, help meet corporate marketing strategies by creating a captivating customer experience. The artists selected to perform at the fashion show are chosen to meet the target market s musical preferences, therefore attracting more consumer attention. This use of experiential marketing immerses the Victoria s Secret consumers in a branded experience, while also attracting new users (Tuckewell, Figure 4: Example of theatrical lingerie- $2.5 Million Fantasy Bra 2013). The social media campaign element of the Victoria s Secret Fashion Show also creates an alluring customer experience through engagement and inclusion. By engaging in the Angel Wing Box photo uploading, consumers are all united in a brand following and feel valued by doing so. The themes selected for the VS Fashion Show also contribute to meeting corporate marketing goals. Theatrical lingerie lines draw attention to the Fashion Show due to their over- the- top and surreal nature (See Figure 4). Increased amounts of consumers want to see these larger than life displays of lingerie, angel wings, and stage displays because they are very entertaining and exciting. Unfortunately, these theatrical pieces are usually not available for consumer purchasing. Practical lingerie lines appeal to consumers, as they are product that are realistic and are actually available to purchase (See Figure 5). However, the practical lines are out numbered by the theatrical ones. Figure 5: Example of practical lingerie 7
9 The Victoria s Secret Fashion Show event also meets the event goals by attracting new consumers and generating sales. Prior to, during, and after the Victoria Secret Fashion show the brand is exposed through advertising, social media, and PR. The vast buzz around the fashion show generates interest that leads to increased views and ultimately, as a result, increased sales. Customer relationship management improves when consumers feel valued and satisfied. The fashion show and its correlated marketing campaigns meet these consumer needs, adding value to their brand in the consumer s minds. RECOMMENDATIONS After conducting a thorough marketing analysis of the Canadian Victoria s Secret Fashion Show, we believe there are two main changes to be made in effort to better achieve both corporate and event goals for the company. Our first recommendation is the creation and implementation of an All Canadian lingerie line that is exclusive to the Canadian market. The line will be debuted at the first Canadian Victoria s Secret Fashion Show and will be a specialty line that only Canadian Victoria s Secret stores carry. This exclusivity marketing strategy will offer a unique value to Canadian consumers that they can associate with prestige and patriotism (Tuckwell, 2013). The exclusive nature of the All Canadian lingerie line will also allow the company to charge a premium price for the items, creating high profit margins that contribute to meeting corporate and event marketing objectives. Our second recommendation directly correlates to the first, as it is a continuation of the patriotic theme. We believe that the Canadian Victoria s Secret Fashion Show event, as well as all other marketing strategies, should include a majority of Canadian models. Hiring more Canadian models will not only help our country s economy, but will show consumers that Victoria s Secret Canada is supportive of our citizens and differentiated from the American Victoria s Secret. Making changes that reflect Canadian pride, differentiation, and care for our country s economy will contribute to meeting corporate and event marketing goals more effectively, including sustainable growth. 8
10 BIBLIOGRAPHY Adams, C.R. (2012) Victoria s Secret Fashion Show 2012 leads CBS in the ratings. Retrieved from s- secret- fashion- show leads- cbs- the- ratings Flavelle, D. (2010, April 14). Victoria's Secret to expand in Canada. Retrieved October 5, 2013, from Thestar.com Business: Guthrie, Marisa. (2011) The Hollywood Reporter, How Victoria s Secret Fashion Show turns $12 million into $5 billion in One Hour. Retrieved from secret- fashion- cbs Limited Brands (2013), About us, Maheshwari, S. (2012, November 20). The marketing secrets of Victoria's Secret. Retrieved October 2, 2013, from Chicago Business Trubune: Morris, B. (2006 June 13). The Spotlight Blog. Victoria s Secret Plays Marketing Ball. Retrieved from secret- plays- marketing- ball.html. Newsom, J. S. (2013, May 4). The Problem with Victoria's Secret's Marketing. Retrieved October 3, 2013, from Huffington Post Bussiness: Secret, V. (2013). Victoria's Secret Customer Service. Retrieved October 4, 2013, from Victoria's Secret: Statistics Canada. (2011) Census: Age and sex counts. Retrieved May 29, pdf Talamazan, Y. (2013, August 27). Vancouver's retail scene booming with Victoria's Secret store opening. Retrieved October 2, 2013, from Global News: Tuckwell, K. J. (2013) Think Marketing, First Edition Victor, F. M. (2011, March 12). Victorias secret "angel wings": Strategic marketing synergy. Retrieved from secret- angel- wings- strategic.html Webley, K. (2012, April 2). All- Time 100 Fashion Icons - Roy Raymond. Retrieved October 4, 2013, from Time Lists: Yang, Jeff (2012, September 17). The Wall Street Journal. Why the Rise of Asia In Fashion Isn t As 9
11 Beautiful As It Seems. Retrieved from the- rise- of- asia- in- fashion- isnt- as- beautiful- as- it- seems/ 10
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