The Washington PostDemocracy Dies in Darkness

Just about every store at the mall is struggling. Then there’s Bath & Body Works.

The candle-and-lotion chain has notched 40 straight quarters of sales growth. Even analysts are flummoxed.

Sales have risen for 40 straight quarters at Bath & Body Works, making it the rare mall success story. (Christopher Dilts/Bloomberg)

There is only one reason Abigail Burt goes to the mall anymore: to smell the candles at Bath & Body Works.

The 21-year-old college student stops in each month, whether she has spending money or not, then makes a beeline for the exit, bypassing every other store.

“Every time a new scent comes out, my roommate and I are like, ‘We’ve got to try it,'” she said. “I walk in and just feel so happy."

For three decades, Bath & Body Works has been an enduring and unexpected bright spot in the now-crumbling landscape of America’s malls. The retailer, known for highly scented lotions and candles with names such as Twinkling Nights and Underwater Oasis, has notched 40 straight quarters of sales growth and continues to attract new customers at a time when mall visits are dwindling. Analysts say it has defied many of the challenges roiling the retail industry — though they could not exactly say why.

“It truly is a head-scratcher,” said Sucharita Kodali, a Forrester analyst whose preteen daughters are fans of the brand. “There are so many things going against this company: It’s a mall merchant — that, alone, should have spelled doom. And it’s selling commodities that are broadly available elsewhere, often for cheaper. But somehow Bath & Body Works has figured out how to appeal to the masses.”

Burt, an advertising major at the University of Georgia, has been a devotee since middle school. Unlike so many other retailers of her youth — Aeropostale and Claire’s among them — that have staggered through bankruptcy and store closures, Bath & Body Works is posting double-digit growth and expanding into new locations. Analysts say its 1,600 U.S. stores, most located in shopping malls, have become destinations unto themselves.

Malls are dying. The thriving ones are spending millions to reinvent themselves.

“To me, it’s Exhibit A that the mall is not dead,” said John Morris, a senior analyst at D.A. Davidson. “Bath & Body Works has found a way to get everyone into its stores, teens up to baby boomers."

Morris traces the retailer’s success to its constantly changing assortment of candles, shower gels and hand creams, which can be tried out in stores. Many products are affordable indulgences that appeal to preteens on an allowance, as well as 50-somethings in search of a pick-me-up. It doesn’t hurt that the company has invested heavily to transform its stores into bright, fanciful enclaves of escape.

“When you go into a second- or third-tier mall, a lot of stores look very gloomy or down on their luck,” said Neil Saunders, managing director of research firm GlobalData Retail. “Bath & Body Works, though, stands out: It’s a shiny beacon that draws customers in."

A spokeswoman for L Brands declined to comment but provided a transcript of remarks made recently by Nicholas Coe, the retailer’s chief executive.

Bath & Body Works has become “a ludicrously powerful brand” by constantly assessing — and reassessing — every part of its business, he told investors in September. Stores often double as testing labs, allowing executives to experiment with new floor plans, prices and products to determine what its customers want. Plus, he said, it helps that few rivals have been able to strike the same balance between “prestige” and affordability.

“We have competition, but we don’t have a direct competitor that looks just like us and does what we do,” Coe said. “Our brand has a very, very clear point of view. You’re not wallowing in ambiguity when you walk into one of our stores.”

As a result, the retailer has become a darling of mall owners and operators. The Mall of America in Bloomington, Minn., the nation’s largest shopping mall, has not one but two stores that have recently been remodeled and expanded. Bath & Body Works “has always been a destination,” said Heather Brechbill Swilley, the mall’s senior vice president of leasing. It’s “successful and relevant.”

Adrienne Myers, 28, bought her share of Sweet Pea shimmer lotions, body sprays and “other embarrassing sparkly stuff” while she was in middle school. She hadn’t thought about Bath & Body Works for years until a friend mentioned buying all of her candles there.

Abandoned malls are sputtering back to life with megachurches, rooftop pools and homeless shelters

“I was like, ‘Really?,'” said Myers, who lives in Washington, D.C. “I kind of thought of it like Abercrombie — a store you shopped at when you’re younger and then forget about.” But she bought a candle and liked the way its scent filled her room. Now she stocks up every few months.

“Honestly, it’s one of the only reasons I come to the mall anymore,” Myers said during a recent stop at a store in Northern Virginia.

Inside, rainbow-hued candles, shower gels and body lotions were lined up by scent and color. There was no shortage of discounts. Hand soaps: six for $26. Plug-in fragrance refills: five for $24. All body scrubs, shower gels and fragrance mists: buy three, get three free.

Angeline Williams, 64, popped in to redeem a birthday coupon for 20 percent off. She bought a bottle of her favorite lotion, formulated to smell like Japanese cherry blossoms.

“They have very friendly customer service and really good products that smell fresh,” said Williams, who works at Nordstrom a few doors down. “I definitely stock up when they send me coupons.”

It is a formula that not many brands, including sister company Victoria’s Secret, have been able to replicate. The lingerie company — which has the same parent company, L Brands — has posted sales declines for 12 of the past 13 quarters as it struggles to win over consumers put off by its sexualized marketing. On Thursday, L Brands revised down its 2019 forecast after reporting that holiday same-store sales fell 12 percent at Victoria’s Secret. At Bath & Body Works, they jumped 9 percent.

Your love of Bed Bath & Beyond coupons could be killing the retailer

Analysts say Victoria’s Secret also has suffered from L Brands Chairman Leslie Wexner’s personal ties to Jeffrey Epstein, the millionaire sex offender. But Saunders says Bath & Body Works and its “very wholesome” image have remained largely immune to those woes.

“These are two companies that couldn’t be more different,” he said. “Victoria’s Secret is stuck in its ways and is out of touch with what consumers want. Bath & Body Works is the opposite: It’s authentic, has friendly stores and is constantly challenging itself.”

Beauty product and candle sales are also on the rise as Americans gravitate toward inexpensive indulgences. Chains such as Lush, the U.K.-based company with 200 U.S. stores, and Ulta Beauty, which has 1,100 stores, have both benefited from rising demand for moderately priced cosmetics, bath gels and other personal restoratives.

‘I feel cheated’: Thousands of fake online stores are rushing to cash in

“Bath & Body Works has become one of the only places in the mall where you can pick up an affordable gift,” Kodali, of Forrester, said. “It’s this little pocket of retail that no one has successfully emulated.”

Sales rose 10 percent in the first nine months of 2019, and 12 percent the year before that. Store traffic is up, as are online sales. Annual revenue, which is approaching $5 billion, has climbed for 11 consecutive years. Bath & Body Works opened three dozen stores in 2019, notable growth in a sector that announced a record 9,300 store closures.

Its stores are relatively small, making them inexpensive to operate, and they don’t have many mall-based competitors, according to Kodali. And though mainstream chains such as Target, Walmart and CVS have beefed up their beauty aisles in recent years, she says their products don’t quite have the same cachet.

Billion-dollar baby: How Carter’s became a staple of just about every child’s wardrobe

But Randal Konik, an analyst for Jefferies, warns that the company’s never-ending discounts and sales are thinning profit margins. Plus, he says, candle sales — which make up 40 percent of the chain’s revenue vs. 15 percent a decade ago — are likely to plateau soon.

“The candle party is over,” he wrote in a note to clients Thursday. “The peak of the cycle has been reached."

Maybe, but Tony Serafini is not deterred.

The 44-year-old English teacher keeps a tube of Cucumber Melon body cream in the top drawer of his desk, tucked between Sharpies and masking tape. He has been shopping at Bath & Body Works for more than two decades and has no intention of stopping — much to the amusement of his seventh-grade students.

“People make fun of me, but I just really like the scented cream,” he said. “It’s something I was brought up on, and it’s a name I recognize and trust.”

Plus, he says, “everyone tells me I smell good.”

It is also one of the few stores he and his daughters, ages 10 and 13, can agree on. The girls stop in every two weeks for the mini bottles of hand sanitizer they keep clipped to their backpacks.

Serafini, meanwhile, goes to Bath & Body Works twice a year — and breezes past just about every other store at the local mall in central Massachusetts. He and his family, he said, buy nearly everything else online.

“I can’t think of another company I’ve shopped at for 20 years,” he said.