The arrival of Victoria’s Secret and the Fifty Shades of Grey effect are quickening the pulse of the lingerie market.
Victoria’s Secret opened its London flagship this week, thrusting the world of lingerie firmly into the spotlight, with UK stores hoping to benefit from the halo effect.
The media hype around the US chain’s launch reached a peak when the doors opened on the 40,386 sq ft New Bond Street store, which followed its UK debut at Westfield Stratford in July. Some might think that such a spotlight on one retailer would make it difficult for other chains to compete, but rivals are viewing the opening as positive.
“It’d be foolish to think this launch isn’t going to affect things, but we see it as a good opportunity to have an even greater focus on our customers,” says Sharon Webb, head of buying and design for lingerie at Debenhams. “Anything that brings lingerie to the front of people’s minds is great for the whole industry.”
Frances Russell, lingerie trading director at Marks & Spencer, agrees.
“It’s a great thing to shine a light on the lingerie sector – and new competition always sharpens your pencil,” she says.
But there is another reason why the established names are happy to take on more competition. The lingerie market has been one of the best-performing fashion sectors during the downturn, consistently outperforming the stagnant womenswear market.
Between 2008 and 2012, the volume of lingerie sales is estimated to have grown 0.6% compared with womenswear, which remained flat. The total annual market was worth £1.52bn, as at July 8.
The arrival of Victoria’s Secret on UK shores comes at a time when lingerie growth is expected to further strengthen, with Verdict Research predicting a 2.2% volume rise this year against 0.3% growth in womenswear.
Honor Westnedge, senior analyst at Verdict Research, says this points to the fact that lingerie is recession-proof: “Average price points are usually lower than clothing, so it gives women a reason to buy something new. You can buy a new set for £20 and it doesn’t break the bank. The market is doing slightly better than clothing because it’s a needs-driven sector and the prices are slightly lower.”
Although the lingerie market has become more competitive, with general clothing retailers such as New Look and Primark upping their offers, Westnedge believes consumer appetite allows for more players to enter the market without stealing share – and may even encourage an increase in demand.
“Victoria’s Secret bridges the gap between the likes of Marks & Spencer and the higher end Rigby & Peller and Agent Provocateur,” she says. “People will like Victoria’s Secret because it has more fashionability and newness. In the US this has given consumers a reason to make purchases more often and this will force UK players to raise their game.”
Existing retailers are already refreshing their mix with new products. Market leader M&S, which has a 27.4% share by volume, last week launched a line by model Rosie Huntington-Whiteley.
The 33-piece Rosie for Autograph collection includes silk lingerie sets, camisole and French knicker sets and a kimono-style robe.
M&S’s trading director for beauty and lingerie Frances Russell agrees that the lingerie market has remained robust throughout the recession. “The nice thing about lingerie is that it acts as a little treat – and little treats are always really important during a recession,” she says.
However, with competition increasing, lingerie businesses are striving to ensure their products stand out from the crowd.
Nigel Addison, sales director for the UK and Republic of Ireland at Eveden, which owns lingerie brands Freya, Fauve, Fantasie, Huit, Goddess and Elomi, says retailers and brands are working harder than ever to keep customers loyal.
But Eveden’s continuity business has been particularly strong throughout the downturn because retailers have had to focus on their core best-selling lines, with staple products in black, nude and white continuing to sell well.
Debenhams’ Webb too has found that customers are looking for products they can trust, in terms of both quality and fit.
“In the past we’ve seen more impulse purchases from customers, but now that people are trying to be a bit more sensible with their spend we’ve noticed our customers are investing in products they know and trust.”
Shirley Ryan, owner of indie Mirari Lingerie in Dorchester, Dorset, says her customers have been homing in on “better quality, longer-lasting lingerie”, but she has also noticed that bras have sold better than knickers – an experience borne out by UK-wide figures.
Sales of bras by value rose 3.7% over the year and sales of non-underwired bras increased 14.7%, according to Kantar Worldpanel. Sales of briefs and knickers rose 3.6%, but sets of bras and briefs struggled, with sales down 9.4%.
But not everyone is sticking with their favourites. With consumers inspired by erotic novel Fifty Shades of Grey, some lingerie retailers have reported a surge in sales of some of their saucier items.
Suspender sales, along with basques and lacy black pieces, have grown at Eveden across its Freya, Fantasie and Huit brands.
The ‘Fifty Shades effect’ is particularly prevalent at the kinkier end of the market, with sales at lingerie and sex toy retailer Ann Summers rocketing by a dramatic 78% year-on-year, which the retailer says was driven by the phenomenal success of the erotic novel.
At Playful Promises, brand director Emma Parker says its autumn 12 Dominique range has also seen a boost. “There is a definite bondage influence and the overt briefs that are part of the set are selling unexpectedly well. This may be the Fifty Shades effect or perhaps English people just like cheeky lingerie.”
Over the past few years the online sphere has emerged as the perfect selling platform for underwear – this year lingerie etailer Figleaves made its first full-year profit in its 13-year history – £250,000 in the year to March 3.
Meanwhile, Ann Summers saw its online sales rocket 50% for July 2012 compared with the same month last year. With the launch this week of an app that allows customers to virtually ‘try on’ underwear at home, it suggests the retailer is targeting those who may feel uncomfortable revealing their inner saucepot on the high street.
“Lingerie pure-play etailers are the best-performing retail sector, growing at more than 27%,” says Charlotte Wilks, consumer research analyst at Kantar Worldpanel. “In fact, lingerie growth in pure-play is faster than respective growth in women’s outerwear, menswear and kidswear pure-play.”
With the online world providing the privacy to buy saucy pieces, Victoria’s Secret upping the prominence of underwear in the press and erotic fiction inspiring women to experiment, it seems lingerie retailers have no reason to get their knickers in a twist.
Story in Numbers
27.4% - Marks & Spencer’s market share in lingerie by value £1.52bn Size of UK women’s lingerie market in the year to July 8 2% Growth in the UK women’s lingerie market in the last year
£4.50 - Average price of women’s underwear
230.2bn - Women’s knickers sold in the last year to July 8
40,386 - Size, in square foot, of Victoria’s Secret store on New Bond Street