How Victoria's Secret Will Continue To Crush The Competition

Victoria's Secret has become the only name that matters in lingerie.

The company controls a whopping 35% of the lingerie market - a remarkable feat for a specialty retail brand.

Several retailers - from teen powerhouse American Eagle, to start-ups like AdoreMe - have tried to compete with the brand.

But no one has come close to the dominance of Victoria's Secret.

The company has a calculated strategy for captivating the girls and women in America, said Danielle McCoy, vice president of equity research at Wunderlich Securities.

She shared the brand's formula for success against competitors.

1. Captivating female customers.

Much of Victoria's Secret's success has to do with the highly refined marketing strategy, McCoy told us. The brand's advertising team carefully selects models they believe female customers will relate to.

instagram.com/alecambrosioAlessandra Ambrosio's image as a mother helps Victoria's Secret sell more lingerie.

For instance, longtime Angel Alessandra Ambrosio's image as a wife and mother helps the brand. Victoria's Secret reportedly declined to work with sexy model Kate Upton because she might be threatening to female customers.

By striking the right balance between sexy and approachable, Victoria's Secret successfully achieved mass appeal.

Women are also more likely to be willing to pay full price for the goods.

"Let's face it, everyone wants to be a Victoria's Secret girl!" McCoy said.

Michael Loccisano/Getty ImagesThe Victoria's Secret Pink stores for teens are another example of the brand's lifestyle appeal.

2. Uniting stores with online.

Victoria's Secret is using online data to make smart merchandizing decisions in stores. The company has been streamlining its store and online assortments to give customers what they want, McCoy said.

For instance, bras that are promoted in-stores are also displayed prominently on the website.

The company also noticed that activewear, swimsuits, and loungewear were performing well online, so executives are ramping up offerings of those items in stores.

3. Paying attention to international markets.

Overseas growth remains a huge growth opportunity for Victoria's Secret, McCoy tells us.

The company entered mainland China this year, which could potentially lead to a much larger expansion.

In recent years, Victoria's Secret has incorporated more Asian models into its catalogues and annual fashion shows. Many analysts see this as an attempt to connect with the emerging middle class in Asia.