Victoria's Secret was founded by Tufts University and Stanford Graduate School of Business alumnus Roy Raymond, and his wife Gaye, in San Francisco, California on June 12, 1977. Eight years prior to founding Victoria's Secret, Raymond was embarrassed when purchasing lingerie for his wife at a department store. Newsweek reported him looking back on the incident from the vantage of 1981: "When I tried to buy lingerie for my wife," he recalls, "I was faced with racks of terry-cloth robes and ugly floral-print nylon nightgowns, and I always had the feeling the department-store saleswomen thought I was an unwelcome intruder." During the 1970s and 1980s, most women in America purchased "dowdy", "pragmatic", "foundation garments" by Fruit of the Loom, Hanes, and Jockey in packs of three from department stores and saved "fancier items" for "special occasions" like honeymoons."Lacy thongs and padded push-up bras" were niche products during this period found "alongside feathered boas and provocative pirate costumes at Frederick's of Hollywood" outside of the main stream product offerings available at department stores. Raymond studied the lingerie market for eight yearsbefore borrowing $40,000 from his parents and $40,000 from a bank to establish Victoria's Secret: a store in which men could feel comfortable buying lingerie.The company's first store was located in Stanford Shopping Center in Palo Alto, California. |
1977–1980: The early years
Victoria's Secret grossed $500,000 in its first year of business, enough to finance the expansion from a headquarters and warehouse to four new store locations and a mail-order operation. By 1980, Raymond had added two more San Francisco stores at 2246 Union Street and 115 Wisconsin Street. By 1982, the fourth store (still in the San Francisco area) was added at 395 Sutter Street.Victoria's Secret stayed at that 395 Sutter Street location until 1991, when it moved to the larger Powell Street frontage of the Westin St. Francis. In April 1982, Raymond sent out his 12th catalogue; each catalogue cost $3. Catalogue sales now accounted for 55% of the company's $7 million annual sales. The Victoria's Secret stores at this time were "a niche player" in the underwear market. The business was described as "more burlesque than Main Street." |
Roy Larson Raymond (April 15, 1947 – August 26, 1993)was an American businessman, who founded the Victoria's Secret lingerie retail store.
Raymond was an alumnus of Tufts University and Stanford Graduate School of Business.
Raymond worked for the Vicks company in their marketing department.
On June 12, 1977, he opened the first Victoria's Secret store at the Stanford Shopping Center after feeling embarrassed trying to purchase lingerie for his wife in an awkward, public department store environment. To open the store, he took a $40,000 bank loan and borrowed $40,000 from relatives. The company earned $500,000 in its first year. He quickly started a mail order catalog and opened three more stores.
In 1982, after five years of operation, Raymond sold the Victoria's Secret company, with its six stores and 42-page catalogue, grossing $6 million per year, to Leslie Wexner, creator of The Limited, for $4 million.By the early 1990s, Victoria's Secret had become the largest American lingerie retailer, topping $1 billion. In FY 2009, Victoria's Secret was worth over USD $5 billion.
In 1984, Raymond started My Child's Destiny, a retail store for children, that went bankrupt in 1986.
On August 26, 1993, Raymond committed suicide by leaping off the Golden Gate Bridge at the age of 46.
Raymond was an alumnus of Tufts University and Stanford Graduate School of Business.
Raymond worked for the Vicks company in their marketing department.
On June 12, 1977, he opened the first Victoria's Secret store at the Stanford Shopping Center after feeling embarrassed trying to purchase lingerie for his wife in an awkward, public department store environment. To open the store, he took a $40,000 bank loan and borrowed $40,000 from relatives. The company earned $500,000 in its first year. He quickly started a mail order catalog and opened three more stores.
In 1982, after five years of operation, Raymond sold the Victoria's Secret company, with its six stores and 42-page catalogue, grossing $6 million per year, to Leslie Wexner, creator of The Limited, for $4 million.By the early 1990s, Victoria's Secret had become the largest American lingerie retailer, topping $1 billion. In FY 2009, Victoria's Secret was worth over USD $5 billion.
In 1984, Raymond started My Child's Destiny, a retail store for children, that went bankrupt in 1986.
On August 26, 1993, Raymond committed suicide by leaping off the Golden Gate Bridge at the age of 46.
To understand how novel Raymond’s idea was, it helps to have a little context. In the 1950s and ’60s, underwear was all about practicality and durability. For most American women, sensual lingerie was reserved for the honeymoon trousseau or the anniversary night; Frederick’s of Hollywood was the granddaddy of the specialty lingerie retailers. When the women’s movement of the late 1960s and ’70s called for women to liberate themselves from the bondage of bras, the intimate apparel industry responded with new designs that they claimed would give women thenatural look they desired without the embarrassment of a sagging bustline. But for the most part, underwear remained functional, not fun.Victoria’s Secret changed all that, and in the Bay Area, its sales continued to boom—thanks in large part to its catalog, which reached customers across the country. Within five years, Raymond had opened three more stores in San Francisco. By 1982, the company had annual sales of more than $4 million—yet something in Raymond’s formula was not working. According to management experts Michael J. Silverstein and Neil Fiske’s book Trading Up, Victoria’s Secret was nearing bankruptcy.
Enter Leslie Wexner, the man who had ushered in the mass-market sportswear boom with a store he called The Limited. While still in his 20s, Wexner had recognized that women were forgoing dresses for separates and casual wear. So in 1963, he opened a store “limited” just to sportswear. Wexner’s foresight paid off. The Limited grew to 11 stores by 1970, and 188 by 1977, according to a Forbes profile published that year. Wexner, now 40, was worth $50 million. |