already scouting locations for a second full-range store. One source close to the brand confirmed that the retailer is looking to open at Chadstone before Christmas and said the assortment would be very similar to stores in Hong Kong and the US. Victoria’s Secret opened a much-anticipated four-storey flagship store on Causeway Bay in Hong Kong in July, its first full-range store in the city-state. While the source could not say whether the look and feel of the Chadstone store would be similar to the Hong Kong flagship, which is not operated by Valiram, it will be decidedly smaller, measuring only around 1300sqm, compared to over 4600sqm. The source confirmed that Valiram plans to open further full-range stores in Australia and is currently exploring a second site, but when asked whether Victoria’s Secret was taking over the former Topshop site at Melbourne Emporium – as a second source suggested – the source said no other sites had been confirmed yet. Today, there are 21 Victoria’s Secret stores around Australia, eight of which are in airport terminals, carrying a limited range of beauty, fragrance and accessories. The move to open full-range stores comes eight years after Valiram first launched the Columbus, Ohio-based lingerie brand in Australia. According to the source close to Victoria’s Secret, Australian consumers have been ordering the retailer’s bras, underwear and Pink brand items online in large volumes from the US, demonstrating strong demand for the broader range. Tremendous growth prospects The source could not comment on how demand in Australia stacks up against the US, where comparable store sales have been mostly on the decline for the past two years. L Brands, the company that owns Pink and Victoria’s Secret in the US, Canada, UK and China, along with Bath & Body Works, La Senza and Henri Bendel, last week reported an 8 per cent increase in net sales to US$1.058 billion for the five weeks ended October 6, 2018, and a 5 per cent increase in comparable sales, exceeding analyst expectations. However, if you look at just Victoria’s Secret, comparable sales in the US and Canada only grew 1 per cent in the five weeks ended October 6, 2018. And if you exclude direct sales, meaning you only measure company-owned bricks-and-mortar stores, comparable sales actually fell 2 per cent. Most troubling of all, teen-focused lingerie and loungewear brand, Pink, saw comparable store sales growth fall to the low-to-mid single digits in Q2 FY18. Any number of reasons have been cited for the lingerie brand’s lacklustre performance, ranging from its failure to capture the plus-size market, to the dissonance between its brand image and the #metoo era of female empowerment, to discounting fatigue. Whatever the problem, it seems plausible that it’s isolated to the US and other Western markets, where the brand has been active for much longer. “They have tremendous growth prospects outside the US, not just Australia but in Asia. Their product mix is really good, and they do very good stores,” Michael Baker, a retail consultant who has spent time in the US and Asia, told IRW. Victoria’s Secret’s potential outside the US is not fully tapped, he said. “They have a really big product line, they’re big into sportswear. They’ve got a lot more stuff to put into stores in Asia and Australia than we have seen so far,” he said. Fewer, bigger stores The extensive product line alone doesn’t explain why Victoria’s Secret is targeting larger footprint stores in Australia, according to CBRE’s Zelman Ainsworth, who told IRW that there is a trend towards fewer, bigger stores in retail right now, especially among fashion and technology companies, due to the growth of omnichannel retail. “We’re seeing that a lot of retailers are changing the way they’re retailing and using online to create showrooms and display stores, where customers can go and see the brand and try and learn about products, but do all ordering from a different destination,” Ainsworth said. “Banks are doing it, medical services are doing it, luxury retailing is definitely doing it. They have only one or two stores, but they’re offering the full offering. Fast fashion definitely does it, and that’s where retail is going.” Access exclusive analysis, locked news and reports with Inside Retail Weekly. Subscribe today and get our premium print publication delivered to your door every week.