With the Sale of Victoria’s Secret and Les Wexner’s Departure, the Era of L Brands Is Over

CEO Les Wexner has stepped down, and a majority stake in Victoria's Secret has been sold

L Brands announced the sale of a 55% stake of Victoria's Secret this week. Getty Images
Headshot of Diana Pearl

It’s the end of an era at Victoria’s Secret—in more ways than one.

This week, L Brands made two major announcements: Founder and CEO Les Wexner, who has been in the top job for 57 years, is leaving his post. The other is that the company is selling a 55% stake in its most high-profile holding, Victoria’s Secret, to private equity firm Sycamore Partners.

The move officially places L Brands’ most talked-about brand in private hands, and values the lingerie retailer at just $1.1 billion, a fairly paltry sum for a company with over 1,600 stores worldwide. The sale leaves L Brands with a 45% stake in the retailer, which includes control over the Pink line.

This news isn’t just significant for Victoria’s Secret, but also its parent company, once a retail conglomerate whose stores filled American malls. Previously, L Brands counted The Limited, Lane Bryant, Henri Bendel, Abercrombie & Fitch, Express and more as part of its portfolio. With the sale, Bath & Body Works becomes the lone remaining brand under the L Brands umbrella. And as Wexner’s departure coincides with the sale, it’s hard not to feel a major shift: The era of L Brands, as consumers have long known it, is well and truly over.

“L Brands used to be a wing of a mall. They could just set the stores up and then people would just buy, and it was amazing,” said Bob Phibbs, CEO of New York-based consultancy The Retail Doctor. “But they became so big that it was hard to see what was really happening underneath. Instead of divisions actually being forced to change, they were allowed to grow stale.”

With brands like The Limited in its portfolio, L Brands dominated the mall

In some ways, that era has been over for some time. For the past several years, L Brands has been unloading its lower-performing properties: In 2018, it shuttered Henri Bendel; Lane Bryant was sold in 2012 and Express in 2007. A majority stake in its flagship brand, The Limited, was also sold in 2007. Since then, Victoria’s Secret has been the jewel in its crown, so to speak.

Still, the sale of Victoria’s Secret feels inevitable. The brand has had a rough few years, both in looking at the numbers—most recently, the 2019 holiday season saw a 12% decline in same-store sales and there was a 10% drop in sales during the fourth quarter of last year—and public sentiment.

In 2019, the brand canceled its most high-profile event, the Victoria’s Secret Fashion Show, which had occurred nearly every year since 1995 and drew the likes of Tyra Banks, Heidi Klum, Adriana Lima and Gigi Hadid to its runway. The event had faced a wave of negative backlash coupled with a declining public interest: The ratings for its televised broadcast peaked at over 10 million, but by 2018 (the final year of the show) it had dwindled to just over 3 million.

And in 2020, Victoria’s Secret’s approach to lingerie—and, essentially, femininity—also feels increasingly outdated at best, and misogynistic at worst. The brand was known for its sex sells image, boudoir-like stores, and branding that positioned women’s undergarments as items of fashion, not function, all cultivated by Wexner and his right-hand man, longtime Victoria’s Secret chief marketer Ed Razek, who left the company in 2019.

With few competitors besides department stores, women didn’t have many other options when it came to how lingerie was portrayed in advertising. But the advent of DTC challengers like ThirdLove, which prides itself on its female gaze-fueled advertising, made Victoria’s Secret’s perspective stand in stark comparison.

“There is something to be said for sticking to what your brand stands for, but at the same time, if it’s counter to what your customers are now demanding from your category, that’s a different challenge altogether,” said Tiffany Hogan, principal analyst at Kantar.

Now, as Victoria’s Secret prepares to go private, the brand will have more freedom to make changes without the oversight of shareholders. But it’s likely that major cuts are on the horizon: Victoria’s Secret has over 1,600 stores worldwide, 1,100 of which are in the United States. That number doesn’t make much sense for a company that’s valued at just $1.1 billion. (To put that number in comparison, Glossier’s estimated value is $1.2 billion—it operates two permanent locations and a few rotating pop-ups.)

“As they go private and make some of these changes, I think we’re going to see a very different store,” said Phibbs. “Victoria’s Secret is going to have a pretty hard reckoning.”

A representative for Victoria’s Secret did not respond to Adweek’s request for comment.

Les Wexner, the longtime CEO of L Brands

@dianapearl_ diana.pearl@adweek.com Diana is the deputy brands editor at Adweek and managing editor of Brandweek.