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Executive Summary:
In response to declining net sales and earnings per share in Q4 2024, Bath & Body Works is implementing a strategic retail transformation centered around its new Gingham+ store design and a continued shift toward off-mall locations. The Gingham+ concept, already deployed in select stores across South Korea, Los Angeles, and Texas, features an elevated shopping experience with larger aisles, scent bars for product testing, and digital displays showcasing product benefits.
The brand is particularly focused on appealing to Gen Z, a demographic showing a strong preference for experiential retail. Recognizing that younger shoppers value in-store product testing and a more relaxing environment, Bath & Body Works has refined its store aesthetics with softer color palettes and interactive product stations.
Additionally, the company is accelerating its move away from mall-based retail. In 2024, it closed 61 mall locations while opening 106 new stores, predominantly in off-mall settings. Currently, 60% of its stores operate outside malls, with a long-term goal of reaching 75% off-mall penetration in North America.
By combining a refreshed in-store experience with a strategic shift in retail locations, Bath & Body Works aims to strengthen its appeal to younger consumers while positioning itself for sustained growth in an evolving retail landscape.
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