So it’s fashion and innovation or bust

The man who put the bounce back into bras and sexed up the ladies’ lingerie sector, Sara Lee Intimates chief executive John Dixey, is leaving the industry to pursue other interests (MW last week). He is leaving at a time when value growth is slowing in the underwear market and Sara Lee, owner of the Gossard, Playtex and Wonderbra brands, is having to address new challenges.

Bras and knickers make up 47 per cent of all underwear sales, which are estimated to have reached &£1.06bn last year – an increase of 14 per cent since 1997. Sales of bras alone account for an estimated &£680m of the underwear market. According to Mintel figures from 2000, Triumph is the leading bra brand with a seven per cent share of the market, followed by Gossard with a six per cent share, while Playtex is in third place with five per cent.

All three brands are seeing a growth in sales but this is outweighed by a drop in retail prices, say industry experts. However, the popularity of new styles of knickers, such as strings and thongs, has helped to create new revenue opportunities.

Dixey is credited with turning around the fortunes of Playtex and Wonderbra. He started as a salesman for Playtex Australia in 1980 and became managing director of Playtex in the UK, also assuming responsibility for Wonderbra, in 1994. The same year, the sexy in-your-face Wonderbra campaign featuring Eva Herzigova’s full-on cleavage, and the Hello Boys slogan, was launched.

The campaign – developed with the brand’s then advertising agency TBWA/London, and its creative director Trevor Beattie – broke just six weeks after the Wonderbra licence switched from then rival Gossard to Playtex.

However, the decade since has seen significant changes in the market. Many women now have more disposable income and are increasingly fashion conscious with underwear being an important part of their fashion shopping list. New entrants, from celebrities like Kylie Minogue’s Love Kylie brand to high-end fashion labels, have provided a challenge for the UK’s biggest underwear retailer Marks & Spencer, and the four big brands, Triumph, Wonderbra, Gossard and Playtex.

Sex, yoked to the concept of empowering women, was a useful marketing tool ten years ago. But now newcomers to the market take their cues from the world of celebrity and fashion: their marketing is talking directly to women rather than men.

The challenge facing Dixey’s replacement, Sara Lee branded apparel president Kirk Adkins, is to make sure Playtex, Wonderbra and Gossard can keep their position in an increasingly fragmented market.

But Sara Lee hasn’t rested on its laurels. Prior to his departure, Dixey oversaw the integration of the UK and Scandinavian arms of Sara Lee Intimates into one division: Sara Lee branded apparel. It has also created Central and Southern European divisions. The rejig followed a review of its brand portfolio and the new structure is aimed at increasing consistency of its products and marketing throughout Europe to help build market share.

Marks & Spencer remains the biggest underwear retailer in the UK, with a 30 per cent value share of the bra and pants market (Mintel 2000). But this share is declining in the face of new rivals such as grocery retailers, for instance Asda’s George range, and fashion multiples such as Topshop and H&M. Independent retailers are also attracting more customers as women become increasingly brand promiscuous.

Gossard has already launched an assault on the thong and G-string market with its sub-brand G-Strings by Gossard. The launch advertising, created by WARL Change Behaviour, poked fun at the old style of sexy underwear marketing and reflected the changes in the market by using the strapline “This is just for men” – with the ‘n’ crossed out. However, some observers say this was a disingenuous way of having your cake and eating it.

Playtex marketing director Stephen Holbrooke says that it is essential to develop categories to create new sales potential, which is something that Playtex is planning to do over the next two years. It launched its Magic Feeling line, a range that provides better support in a lighter bra, earlier this year.

The next concept will be Secrets Make-Up, a body enhancing range, to be launched early next year. Holbrooke says that it aims to develop the body enhancement category away from body control and towards beautification. The Wonderbra brand is also being extended with the launch of a bottom-enhancing underwear range, W-Spirit, also to be launched early next year.

Holbrooke predicts that the industry will see a clear definition between fashion and performance underwear. To survive, Playtex must offer benefits, while retailers have to recognise the importance of brands which offer innovation and that these can complement their fashionconscious own-label brands, he says.

Tony Jarvis, marketing director at Triumph, predicts that underwear brands will have to follow the lead of fashion retailers such as Zara and Topshop, which are able to get copies of catwalk clothes on the high street within weeks, in order to compete.

Even Marks & Spencer has reviewed its positioning as its share is eroded. Its latest underwear campaign, planned and bought by Walker Media, has promoted its range of lingerie in the pages of the women’s weekly celebrity press.

With new brands and products entering the lingerie market, the consumer’s cup runneth over with choice. But long-term survival means being able to generate brand loyalty through innovation and to create marketing that speaks to the modern woman.