Kildare woman Margaret McDonald, who supplied outfits to Kate Middleton at her firm, has been announced as head of design at Victoria’s Secret as the US lingerie company eyes up global expansion, reports Kyran FitzGerald.
A Kildare woman will soon have the final say concerning the style and shape of undergarments at America’s largest lingerie company.
Born in Athy and currently based in London, Margaret McDonald has carved out a highly successful career in retailing, having initially trained at Penneys/Primark, the hugely successful Dublin-based international retailer.
McDonald is taking over as head of design at Victoria’s Secret, an Ohio-based company which operates 1,035 stores worldwide.
Group revenues in 2011 amounted to $6.12bn, with revenues bucking the recessionary trend to grow by almost 11%, that year. Operating income stood at $1bn in a company founded back in 1977 by Roy Raymond.
He is said to have come upon the idea due to the embarrassment he experienced while buying underwear for his wife in conventional department stores.
Sadly, some years after he sold the business, Raymond leaped to his death off the Golden Gate bridge in San Francisco.
By then, Victoria’s Secret was in the capable hands of Lexie Wexner, the son of Russian Jewish immigrants who had established a successful fashion business focusing on young women called, The Limited.
Wexner borrowed $5,000 from his aunt in 1963 to set up the business which he initially ran with his mother, Bella.
The first Victoria’s Secret outlet opened in a shopping centre in Stanford, Connecticut, and most of the stores continue to be located in shopping malls around the US.
Wexner, meanwhile, has gone from strength to strength, amassing a fortune of around $4.5bn (in net worth) according to Forbes.
He is the owner of a 315ft-long yacht called Limitless, which held the title as largest yacht in the US for a period of six years.
Victoria’s Secret provides almost half the profits accruing to Wexner’s group, now known as Limited Brands.
The group was languishing in the mid-1990s. It had brought 14 brands into its corporate umbrella and retail analysts considered that it lacked a clear marketing strategy.
Over the past decade, however, Victoria’s Secret in particular has gone from strength to strength following the launch of a second range of lingerie called Secret Pink aimed at younger female buyers. The strategy has been to hook them when they’re young with brands considered “cute and playful”.
However, this strategy recently showed signs of coming off the rails somewhat when critics accused the company of designing highly sexualised underwear for the ‘tweenie’ market, provoking a backlash among many parents in what is still, in many ways, a conservative, family values-based culture.
According to fashion commentator Michelle Lamar: “Victoria’s Secret is wise to court the younger customers and gain their loyalty early.”
As a mother of two daughters, she cringed; but as a “ruthless marketeer”, Lamar said she approved of the strategy.
Commonly now referred to as an “iconic lingerie company”, Victoria’s Secret has adopted a mid-market pricing strategy, based on a combination of basic everyday wear and high fashion items. It is well-known for its provocative window displays, bold pink and black branding, and clever designs.
It is a big user of international supermodels such as Gisele Bündchen and Naomi Campbell.
The company has, in fact, adopted a high-profile supermodel ‘angels’ strategy aimed at promoting its products on the catwalk. Among its ‘angels’ are Heidi Klum and Adriana Lima.
Victoria’s Secret is swimming in a huge pond as the leading US speciality retailer of women’s “intimate apparel”.
In 2009, total sales of apparel in the US amounted to $305bn — a rise of over 40% in a decade.
The company has been slow to expand overseas. It opened its first UK store in Jul 2012, the second Victoria’s Secret store to open in Europe. It has since opened a second British store in east London. Irish buyers must still shop online for the lingerie if they don’t wish to travel overseas to fetch the garments.
There have been suggestions, however, that a store will open in Dublin before too long.
Certainly the Irish capital has attracted its share of leading US fashion retailers.
After some delay, the US chain Abercrombie & Fitch, which pitches almost exclusively to the young and the beautiful of both genders finally opened a large new outlet on College Green last November
Victoria’s Secret’s tentative moves overseas could well be behind the decision to hire Margaret McDonald, tempting her across the Atlantic from an apparently comfortable perch as managing director of the British fashion retailer Coast.
The Athy-born retailer started out as a trainee buyer in Penneys before moving to work for Gap, French Connection, and Marks & Spencer.
She headed up the buying team at the US fashion retailer Banana Republic when it expanded its operations into Europe.
Having served as chief executive with LK Bennett, McDonald took over in the same role at Coast in 2010.
This company was part of the Aurora Group which had emerged from administration the previous year.
Aurora had been known as Mosaic Fashion. It had four arms including Oasis, Coast, Warehouse, and Karen Millen.
The latter was soon sold off, leaving Aurora running three businesses.
In March, it was announced that Aurora would be broken up, with Coast set to become a standalone business.
Founded in 1996, Coast specialises in wedding wear and clothes for special events, including ball-gowns.
It has successfully ridden out what has been a tough marketplace for British fashion retailers.
Currently it has 70 standalone stores and also operates out of over 250 department store concession outlets.
A year ago, McDonald presided at the opening of Coast’s new 6,000sq ft flagship store in Oxford St, central London. The shop contains 16 fitting rooms.
Not exactly giving much away, McDonald said: “We want the customer to see as much of our product as possible and we want them to have an amazing fitting room experience.”
Locations have also been opened in Leeds and Manchester while internet kiosks have been installed across stores.
Global sales at Aurora Group now exceeds £750m.
However, McDonald’s biggest calling card is as a supplier of outfits to Kate and Pippa Middleton while in her capacity as chief executive at LK Bennett.
This allowed LK Bennett to become the go-to brand in British fashion.
At Oasis, she presided over an expansion into Australia and the Middle East.
McDonald will be joining a company with a huge global supply chain. Much of Victoria’s Secret’s supply is sourced in two factories in Sri Lanka and India.
This relationship between low-wage suppliers and the high-end fashion world of the catwalks has come in for particular scrutiny following a fire in Bangladesh which cost the lives of over 1,000 workers recently.
McDonald will be joining an industry which is also changing rapidly. The traditional shopping mall model is under pressure, with increasing amounts of sales migrating online.
Fashion industry leaders acknowledge that the brick-and-click model is superseding the traditional bricks-and-mortar one.
McDonald joins an exclusive line of Irish women who are or were big players in international retailing, the best known perhaps being Hilary Weston.
McDonald’s job will be to help to craft a strategy for this US company as it develops an increasingly global imprint.
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