- L Brands once dominated the American mall. In its heyday in the 1980s and 1990s, the company owned The Limited, Limited Too, Abercrombie & Fitch, Victoria’s Secret, and Express, among others.
- However, after a series of missteps, the beleaguered company has since sold off nearly all of its brands, including Victoria’s Secret on Thursday, leaving just Bath & Body Works as a standalone company.
- We took a closer look at how the rise and fall of L Brands mirrors the death of the American mall.
- Visit Business Insider’s homepage for more stories.
If there is one company that best exemplifies the demise of the modern mall, it’s L Brands.
Over the course of several decades, L Brands evolved from a humble women’s clothing store in Columbus, Ohio, into a full-fledged retail behemoth. At its peak in the 1980s and 1990s, L Brands operated several of America’s most popular mall brands, including The Limited, Express, Abercrombie & Fitch, Victoria’s Secret, and Bath & Body Works, among others.
Under founder Les Wexner, L Brands seized opportunities for growth through a handful of acquisitions and the development of new brands that diversified its brand portfolio. These additions helped L Brands widen its empire into new areas like sporting goods and luxury, at the now-defunct stores Galyan’s Trading Company and Henri Bendel, respectively.
However, Wexner’s propensity to buy up brands, squeeze them for sales, and then sell them at any sign of strife eventually caught up with him. Before long, L Brands seemed to be losing companies from its portfolio almost as quickly as it had added them. Thanks in large part to the 2008 recession, which rocked nearly every sector of the retail industry but particularly mall brands, L Brands began to lose steam that it was never quite able to regain.
We took a closer look at how the unravelling of L Brands mirrors the death of the American mall by examining the downfall of each of its brands.
In many ways, the story of The Limited exemplifies the rise and fall of retail in America, from its humble beginnings as a small mum-and-pop shop in Columbus, Ohio, to its rise as a staple of the modern mall and its eventual demise in the early aughts.
The brainchild of Wexner and the foundation for the entire L Brands company, The Limited opened its doors in 1963, selling an assortment of women’s apparel. Over the next several years, Wexner focused on expanding the brand and opening more stores, and by 1976, The Limited operated 100 stores nationally. After a couple of savvy acquisitions, Wexner took his company – then known as The Limited Brands – public in 1982, and before long The Limited was in nearly every mall in America.
However, The Limited ultimately fell prey to the same challenges facing several of its mall brand peers. Foot traffic plummeted and sales dwindled. Seeking support, in 2007 L Brands sold a majority stake of the company to Sun Capital Partners, a private-equity firm that works with distressed companies.
While this kept the store afloat for several more years, in 2017 The Limited announced it would close all 250 stores nationwide. Today it lives on as a shell of its former self, with a small online store on the Belk department store website.
When Express came on the scene, it became a slightly more fashion-forward sister brand to The Limited. The first Express store opened in 1980 in Chicago’s popular Water Tower Place, and within just two years it became a separate division of L Brands. However, despite two decades of solid performance, by the early aughts the brand started to fall out of favour with consumers.
In 2007, following several years of underperformance, Wexner sold a majority of Express to Golden Gate Capital Partners and Express became its own privately held company. Today it continues to struggle in the face of the retail apocalypse, and it recently announced it would close 200 stores by the end of 2022.
“Our strategic agenda focuses on growth in the intimate apparel, and personal care and beauty segments of our business,” Wexner said in a statement at the time. “The new ownership structure for Express will provide it with the resources, leadership focus and capital to maximise its potential.”
In an attempt to capitalise on the growing menswear market, Express began adding men’s clothing in 1987. It called this collection Structure and eventually spun off the line into its own store in 1989. In 2001, L Brands rebranded the store as Express Men, which had a brief two-year stint in malls around the nation before the Structure line was sold to Sears.
In 1982, L Brands acquired the plus-size retailer Lane Bryant, including its 207 brick-and-mortar stores and its mail-order business, Brylane. This kicked off a string of acquisitions for L Brands in the 1980s, as Wexner looked to expand into new sectors.
L Brands retained full ownership of Lane Bryant until 2001, when it was sold to the Charming Shoppes, though L Brands kept its corporate offices in Columbus, Ohio. In 2012, Lane Bryant was fully sold to Ascena Retail Group during a vital growth period for the plus-size market, paired with mounting discontent over Victoria’s Secret’s lack of size diversity in its campaigns and runway shows. The inability to capitalise on extended sizes proved to be a blind spot not just for L Brands, but for the entire retail industry.
Also in 1982 – just one month after it filed its initial public offering – L Brands acquired intimate apparel company Victoria’s Secret. In the early days, Wexner turned the focus of the company from men to women and focused on a mix of comfort, style, and affordability.
By the 1990s, the brand was thriving and had become the largest lingerie retailer in the country. It continued to explode in popularity over the course of the decade thanks in large part to the start of the annual Victoria’s Secret Fashion Show in 1995, which featured supermodels like Tyra Banks and Heidi Klum.
Victoria’s Secret continued to reign supreme in the lingerie market until 2015, when sales started to slip due to increased competition and lack of innovation in both its products and its brand image. As the rest of the industry began including a wider range of sizes and more inclusive models in marketing, Victoria’s Secret continued to feature mostly white, thin women in its catalogues and runway shows.
By 2020, Victoria’s Secret had dug itself a hole it was incapable of crawling out of. On February 20, Wexner announced he would be stepping down as chairman and CEO of L Brands and selling a majority share of the company to Sycamore Partners.
The lone luxury department store of the portfolio, Henri Bendel joined the L Brands family in 1985. The century-old store was known for its high-end accessories and handbags, as well as its signature brown-and-white striped pattern.
However, in 2018, L Brands announced it would permanently shutter the store in order to focus on its other brands, namely the struggling Victoria’s Secret. The closures came amid significant strife for the department store industry at large, affecting companies ranging from Sears and JCPenney to Barneys and Lord & Taylor.
“We have decided to stop operating Bendel to improve company profitability and focus on our larger brands that have greater growth potential,” Wexner told The Wall Street Journal at the time.
New York & Company
Also in 1985, L Brands acquired Lerner New York, a women’s workwear company, eventually rebranding it as New York & Company. In 2002, it became its own company after L Brands sold it to Bear Stearns Merchant Banking. At the time of the sale, it operated 522 stores and brought in $US940 million in sales.
In 1987, the company debuted its spinoff brand for young girls, Limited Too, which grew wildly popular with preteens around the country. At its most successful point, Limited Too operated 600 stores in the US, and in 1999 L Brands spun off the company as part of Tween Brands, Inc.
However, in the early 2000s, sales began to slow and by 2008, Limited Too announced that it would be shuttering completely. The beleaguered chain was later purchased by the Ascena Retail Company and rebranded as Justice.
Abercrombie & Fitch
As it continued to grow its mall brand empire, L Brands acquired Abercrombie & Fitch in 1988. At the time, the teen retailer included just 25 stores and one catalogue. However, in the following years, its presence grew as the store shifted its focus exclusively to teenage clientele. L Brands helped get the ball rolling for Abercrombie’s notoriously hyper-sexualized brand identity, a move that ultimately helped grow sales until recent years when the company underwent an extensive overhaul.
In 1996, the company went public and began operating autonomously, but its scantily clad imagery was reminiscent of the challenges that would eventually plague Victoria’s Secret.
Bath & Body Works
Next, Wexner set his sights on the personal care industry with the launch of Bath & Body Works in 1990. Known for its robust collection of scented soaps, body wash, and candles, the company became one of L Brands’ best performing brands, eventually keeping the company afloat as sales at Victoria’s Secret began to plummet.
On February 20, Bath & Body Works became the sole remaining company to be part of L Brands, after Wexner sold a majority share of Victoria’s Secret and stepped down from the company.
Galyan’s Trading Company
Looking to diversify its brand assortment, L Brands purchased Galyan’s Trading Company in 1995, a venture that would prove to be short-lived. By 1999, L Brands had already sold off its majority shares, and a few years later the name was gone for good when the chain was bought out by Dick’s Sporting Goods.
The downfall of Galyan’s signalled the start of challenges for the sporting goods market, including the bankruptcy and liquidation of Sports Authority in 2016.
L Brands purchased Canadian lingerie company La Senza in 2006, but by 2013 the market was so saturated – in part due to competition from other L Brands companies, like Victoria’s Secret – that it closed two-thirds of the stores. In 2019, L Brands sold off the company to the private-equity firm Regent.