Looking at the Secrets of Victoria’s Secret Shoppers

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\"RRA few weeks ago, we published a post on our blog at CheckoutTracking.com about the loyalty of Victoria’s Secret shoppers. Understandably, it generated a fair amount of attention…and an even greater amount of envy.

Here’s why:

  1. Our data shows that in a world where apparel manufacturers struggle to win millennials, Victoria’s Secret has already done so.
  2. While other well-established brick-and-mortar retailers struggle to sell online, Victoria’s Secret has turned into a digital powerhouse.
  3. In an era in which fickle shoppers have made it difficult to win customers’ devotion, Victoria’s Secret buyers are more loyal than intimates buyers at other retailers.

What is it that allows VS to win in those three crucial areas? What, in other words, is Victoria’s Secret? In that earlier blog post, we noted that the key to VS’ success was its young and loyal buyers. But that doesn’t quite explain the breadth of the phenomenon that is VS. To truly understand what’s happening, it pays to look just a bit deeper.

Light, Medium and Heavy

Longitudinal data from Checkout Tracking℠ is based on real receipts from real people, from both online and brick-and-mortar locations, collected over time. That allows us to uncover things that aren’t readily apparent when looking at things like revenue, market share, same-store sales, or other traditional measures. In particular, it lets us see categorized individual buyers and then search for insights within buyer subgroups. And if we look at three such subgroups, Heavy (people who made three or more intimates purchases in the 12-month period ending in April 2016); Medium (those who made two intimates purchases during that time period) and Light buyers (just one intimates purchase during the 12 months), it’s possible to see the secret powers of the Victoria’s Secret shopper.

While only 28% of in-store VS customers are Heavy buyers, they spent more than 50% of their Intimates dollars at VS.

The impact of Heavy buyers’ loyalty is even higher online. Heavy buyers account for 18% of VS Online customers, but 44% of dollars spent at VS.

Looking at the data also unveils information on VS’ true competitors.

For moderate brands like Bali, MF and Warner’s, the overlap is in the Light in-store VS buyer.
Target brands have overlap with the Medium in-store VS buyers.

But online Heavy buyers allocate over 90% of their spend on the VS brand across all intimates categories.
Dive even deeper, and the top secret of Victoria’s Secret becomes clear. Engaging Heavy online buyers has been key to VS’ success.

The difference in spend between Heavy and Light buyers online is a whopping $123 — almost double the $64 gap seen in-store between Heavy and Light.

Numbers like that aren’t easily duplicated, as Marshal Cohen, chief industry analyst, The NPD Group, Inc., has said. “The exclusive and differentiated merchandising mix that Victoria’s Secret offers shoppers has led to a unique breed of consumer that is extremely loyal.” But difficult to duplicate isn’t the same as impossible to duplicate. Any manufacturer or retailer, armed with sufficient data on Heavy, Medium and Light buyers, can figure out which levers to pull to get the biggest gains.

Andy Mantis is executive vice president of Checkout Tracking, a business-intelligence service created by The NPD Group.

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