Investing in Victoria’s Secret
Analysts are waffling with the recent announcements of Victoria’s Secret CEO Sharen Jester Turney that the company needs to revamp its image. In the wake of poor 2007 sales and the downturned US economy, analysts are recommending that the garment industry is not where investors should find themselves. The thought is that many people will be downsizing their wardrobes in order to make it through 2008 financial uncertainty.
And while apparel shopping may suffer low sales in a poor economy, other analysts are countering by saying lingerie is in a league of its own. Investing in companies such as Limited Brands is a smart idea. The rationale behind this notion is that when times are tough, women will dispense with designer clothes and expensive blouse or dress labels. But women still want to feel good about themselves and will continue to spend their money on quality bras and panties.
So apparel in general may suffer but lingerie, on the other hand, may sustain or do better. Added to this, the announcement that Victoria’s Secret may have come too far from its roots and needs to get back on track, may prove beneficial to the company in 2008. The company is scheduled to open thirty-one new stores and remodel another forty-five this spring.
If they can find ways to appeal to and regain their original customers. older women who moved away from the brand, then 2008 may be a successful year. The CEO has identified what she believes to be the problems and all indicators point to a major shakeup.
Investor or shopper, we will all need to watch the progress of Victoria’s Secret in 2008 to see what direction the company takes and what changes are looming. There may be some exciting moves on the horizon.