On September 25, a Victoria's Secret flagship opened again on Shanghai's Huaihai Middle Road. It came six months after the brand shut its first China store, which it had run for nearly nine years. The new store puts wireless bras and activewear ahead of lace, and nearly half of the joint venture that runs it belongs to a Hong Kong manufacturer that used to supply the bras.
1.On September 25, a new Victoria's Secret flagship opened on the corner where Huaihai Middle Road meets Ruijin No. 1 Road in Shanghai. The address is 728 Huaihai Middle Road, the ground floor of 龙凤PRSCO (PRSCO from here), a retail complex that opened this year. The brand closed its first China flagship, three floors on the same street, on March 10, and came back half a year later.
2.The closed store opened in 2017, when the brand entered China, at Lippo Plaza (力宝广场). At about 1,500 sqm it was the largest in the country. It shut because the lease ran out. PRSCO, the new home, is a building of about 50,000 sqm that Huaihai Group (淮海集团) and a partner put up over a metro station. It began trial operations this spring with the China flagship of the Swiss chocolatier Lindt as its first tenant. The size of the new store has not been disclosed.
3.Several black gable-shaped frames stand at the corner of the building, and inside one of them pink crystal glass hangs down like a waterfall. A picture window is cut through the middle of the glass wall, with LED screens set beside it, so from across the street the billboard and the display window read as one sheet. It is a corner unit at ground level, and the storefront faces the crosswalk head on.
4.Step inside and a crystal chandelier hangs from the center of the ceiling while black lines draw diamonds across a white marble floor. The walls are a lattice of mirror pieces. On a round table by the entrance sit a torso in a jeweled bra and a bunch of pink flowers. The store carries everything: lingerie, sleepwear, fragrance, makeup and body care, with fragrance and beauty given their own zone.
5.Each fitting room is a closed room with mirrors on three sides. Staff who take measurements are on the floor at all times, and there is a Shanghai-only service that embroiders lettering onto sleepwear. Neither is something an online order screen can do.
6.The floor mix looks nothing like 2017. Wireless bras, sports bras, loungewear, sweatshirts and joggers have grown a lot. The classic lines that made the name, lace and push-up, still hang in plain sight, but their share has shrunk. Of the three mannequins by the entrance, two wear a hoodie and a cropped T-shirt.
7.The Chinese lingerie market moved first. By a figure Sina (新浪) cited, the share of wireless bras rose from 26% to 68% over six years. As demand shifted from underwear that shapes the body to underwear that is easy to wear, Chinese brands such as Ubras, NEIWAI (内外) and Bananain (蕉内) took that ground first.
8.Prices came down too. The old core bras sold for several hundred yuan; the models doing well on the Tmall (天猫) official store now sit around 100 yuan. Cup sizes and patterns were redrawn for Asian body shapes, and adhesive seamless builds and softer support came in. The aim is to stand in the same row as Chinese brands in front of shoppers who watch price.
9.Volume moves online. According to 21st Century Business Herald (21世纪经济报道), silk-cotton pajamas sold 120,000 sets in 4 minutes 30 seconds during a livestream at this year's 618 shopping festival. Sleepwear and loungewear sell on a screen without anyone trying them on. So what is left for the ground-floor store? Fitting bras.
10.The company opening this store is not Victoria's Secret headquarters. In 2022 the parent sold 49% of its China business to the Hong Kong lingerie maker Regina Miracle International for US$45 million, and the two put in more cash to form a joint venture. Regina Miracle has made Victoria's Secret bras for a long time as a supplier. The factory owner now holds close to half of the shop.
11.The joint venture's figures appear separately in Regina Miracle's annual results. Revenue for the last fiscal year rose 42.4% to nearly HK$2.8 billion, and net profit jumped sixfold. HK$140 million of that was a deferred tax asset from past losses, a one-time gain.
12.The profit Regina Miracle booked from this stake came to HK$237 million (about US$30 million), 84% of the company's total net profit. Strip out the one-time tax effect and recalculate, and the annual share falls to around US$24 million (estimate). Even so, that pays back a US$45 million stake in under two years.
13.More stores are coming. The China count of about 58 is set to pass 70 by year-end. Beijing, Shanghai, Guangzhou, Shenzhen and Hangzhou get filled in more densely, while regional hubs such as Qingdao, Hefei and Harbin get one store per city. The parent is heading the same way. International sales rose 20% last quarter, twice the growth rate of the company as a whole.
14.In 2017, the autumn the brand arrived in China, its fashion show was held in Shanghai. The three floors at Lippo Plaza carried the image the show built out onto the street. The show stopped in 2019. The China joint venture kept losing money after that, then returned to profit in the second half of fiscal 2023.
15.It was not the show that decided what hangs up front in this store. While the show was dark, Chinese brands opened the comfort lingerie market, and Victoria's Secret walked in late. After the joint venture, design and sourcing moved to the local side, and the partner holding that work is a factory that makes bras itself. The pink glass front looks like 2017, but the front rows follow a market that competitors opened first.
16.Victoria's Secret emptied three floors it had used for nine years on Huaihai Road and came back to a ground floor on the same street six months later, with wireless bras and activewear in the front rows instead of lace. The joint venture behind the store grew revenue 42% last fiscal year, and close to half of it belongs to the factory that makes the bras. Anyone trying the same store in Korea hits the ground-floor fitting room first. Floor space rented at street-level rates has to go to fitting rooms and staff who measure, not to display tables. That only works if there is a settlement rule that credits the store with what a customer measured there later buys in the app.