Dive Brief:

• Victoria's Secret appears to be pivoting from its decades-long core marketing approach with the cancellation of its fashion show, according to multiple news reports last week. L Brands didn't immediately return Retail Dive's request for comment.

• The event has faced increased controversy in the era of #MeToo, and in May had already been taken off network television by brand parent L Brands.

• Meanwhile, the brand has hired its first openly transgender model, Valentina Sampaio, for its PINK sub-brand, the model's agent confirmed to CNN. That's notable in light of longtime L Brands marketing chief Edward Razek's comments to Vogue magazine ahead of last year's fashion show that he didn't think the brand's diversity effort should include transgender models. L Brands didn't immediately return Retail Dive's request for comment on the hire.

Dive Insight:

Victoria's Secret was already facing the challenge of determining how its highly sexualized branding, predicated on the male gaze, fits in the #MeToo era.

"Victoria's Secret is currently doing some soul searching to understand what its customers want and what values should be at the heart of its brand," GlobalData Retail Managing Director Neil Saunders told Retail Dive in an email. "Once that is determined it can move forward more confidently with events that are aligned with what consumers want. On balance, the decision not to run the show is prudent. The show personifies many of the problems Victoria's Secret has with its brand and underlines how out of step it is with modern sensibilities. In the recent past it has also become a lightning rod for controversy, which is something the company could well do without right now."

Parent L Brands is also in the position of having to review founder-CEO Lex Wexner's decades-long relationship with convicted sex offender Jeffrey Epstein. But, even without #MeToo or a dicey friendship, the super-sexy, ultra-glam approach was getting tired, and several rivals have stepped in with more comfortable styles that are sportier and prettier than Victoria's Secret's core brand, according to analysts. 

Still, it's a difficult puzzle because the label remains a lingerie juggernaut and a leader in the market. According to a June note from B. Riley, however, while rival Aerie, run by American Eagle, is taking share among younger consumers, Victoria's Secret "continues to be the preferred intimate apparel retailer for the related loungewear and casual activewear categories, which we see as reinforcing the company's turnaround efforts in those segments over the past year." In the quarter ended May 4, L Brands net sales edged up to $2.629 billion from $2.626 billion the year before. Victoria's Secret comps fell 5% (better than expected), with overall flat comps owing a lot to the 13% comp surge at personal care brand Bath & Body Works. 

The brand is under pressure from investors, too. In March activist investor Barington Capital criticized L Brands' failure to bring Victoria's Secret's merchandising and marketing up to date as bad for business. L Brands swiftly pushed back, asserting that it "has made significant changes in its business to focus resources on core categories to enhance performance and accelerate growth," including offloading Henri Bendel and La Senza and making management changes, among other moves.

And in April Moody's Investors Service downgraded L Brand's outlook from "stable" to "negative," with Moody's Vice President Christina Boni citing "the deteriorating operating margins and negative comparable store sales at Victoria's Secret for the past 10 quarters."