The fashion giant that turned fashion shows into a sales machine

Victoria’s Secret was for years one of the most recognizable brands in the fashion world, but in the previous decade it began to lose ground. Criticism of the beauty ideal she presented, competition from young brands and changes in consumer tastes undermined her power. In 2019, the famous fashion show was canceled, and in 2021, the company also separated from the traditional group of angels in favor of branding that focused on diversity and inclusion. The change did not solve the business problems: the stock, which entered independent trading in 2021 at approximately $42.5, traded in the spring of 2025 for less than $20.

Back to the roots

The turnaround sharpened under Hilary Sofer, who assumed the position of CEO in September 2024, the year the fashion show also returned. Under her leadership, the company began to return to the characteristics that made it a global brand, while attempting to combine the heritage associated with it with current concepts of beauty and diversity.

In May of this year, the company took the move one step further, when it announced the change of its trademark from VSCO to VSXY, which may be read as “Very Sexy”. The move was much more than a technical change in the stock market: it signaled the company’s desire to return to the brand identity it had tried to distance itself from in previous years.

It was hard to ask for a better opening for the new symbol. On the day it took effect, June 2, the first quarter report was also published: revenues increased by 15% to 1.56 billion dollars, and the stock jumped by almost 50%. The recovery continued in the second quarter as well: sales grew by about 10% to 1.61 billion dollars, and the adjusted operating profit more than doubled, from 55 million to 124 million dollars.

On Monday this week, after the exhibition, the stock rose by about 3% to $89.98, completing a jump of almost 70% since the beginning of the year. In the capital market, they are beginning to be convinced that the recovery is not just a matter of image.

This time you can also buy

One of the secrets lies in the way the company changed the role of the display itself. In the past it was mainly a showcase event designed to generate media exposure. This year, according to an analysis by Morgan Stanley, the number of items presented there and available for purchase increased 17 times compared to last year. The timing is no coincidence either: the event was held on a Sunday, weeks before the shopping season of November and December, and the company began promoting it months in advance. The goal is simple: not only to make consumers talk about the brand, but to bring them to the checkout.

This is where a well-known phenomenon from the luxury industry comes into play, the halo effect: brands present expensive and inaccessible products to give a sense of luxury to their regular products as well. The Fantasy Bra is a perfect example. The last time she appeared, in 2018, her value was estimated at about one million dollars; This year’s version, designed by the jewelry company Jacob & Co, carries a declared value 50 times higher. Most female consumers will not buy a bra for 50 million dollars, but some may well buy a normal bra from a brand that once again creates a feeling of desirability around it.

When the dream is worth money

This strategy takes on a special meaning precisely at a time when consumers are more sensitive to prices. For companies that sell non-essential products, increasing sales is not enough: they also need to convince customers to pay full price, instead of waiting for sales.

Victoria’s Secret has already reported an improvement in full-price sales and a reduction in promotions. According to a Morgan Stanley analysis, the prices of the items that can be purchased following the display are about 10% higher than the normal prices. If demand holds up, sales at higher prices may also contribute to improved profit margins. In other words, the diamonds may be worth 50 million dollars, but the business test is in a bra that sells for a few tens of dollars.

However, the real test is still ahead of the company. The stock is particularly volatile: after the publication of the second quarter report, it fell by about 14%, despite the improvement in results. Victoria’s Secret still faces stiff competition from brands like Kim Kardashian’s Skims, and there’s no data yet to show how much of the exposure the show generated translated into actual sales.

The comeback of Victoria’s Secret illustrates an old economic principle: sometimes what sells companies is not just the product itself, but the feeling that goes with it. In the case of Victoria’s Secret, the secret was probably never in the clothing – but in the fantasy surrounding it.