Strategy Simplified S21E12: Why Bath and Body Works Lost Its Scent With Shoppers
Nov 20, 2025
Bath and Body Works has seen a drastic decline, with its new CEO criticizing past strategies. The hosts delve into how expanding into adjacent product categories backfired and the risks involved. They discuss the importance of e-commerce and the challenges of customer engagement, questioning whether new offerings actually reached shoppers. Insights on profit from core products share valuable lessons. Plus, they highlight a potential route to recovery by embracing a customer-centric approach, similar to successful brands like Walmart and Target.
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Adjacency Isn't As Close As It Looks
- Bath & Body Works expanded into adjacent categories like shampoo and laundry which diluted focus on its core scented body products.
- That adjacency strategy looked attractive on paper but failed because those markets have different dynamics and fragmentation.
Protect Core Investment First
- Avoid reallocating scarce R&D, marketing, and merchandising to categories customers don't expect from your brand.
- Focus investment on core categories or ensure channel and consumer fit before launching adjacencies.
Discounting Broke Price Integrity
- Discounting to clear unwanted adjacent products destroyed Bath & Body Works' price integrity and hurt brand loyalty.
- Anticipated high margins evaporated when promotions became necessary to move misfit inventory.