Citing a Q3 that saw net earnings drop 1% compared to the previous year and a lower forecast for Q4 and the full year, Bath & Body Works (B&BW) has embarked on a four-point “Consumer First Formula” in order to engineer a turnaround.
Key elements of the new plan, which is expected to generate $250 million in cost savings over the next two years, will include a more curated product assortment, enhancements to its owned retail channels and expansion to new channels — including an Amazon activation scheduled to go live in the first half of 2026.
“Over the years, consumers have evolved,” said Daniel Heaf — who took over as CEO of Bath & Body Works in May — during a call discussing the company’s Q3 financial results. “They seek greater efficacy, ingredient-led products, modern packaging, emotive storytelling and elevated multichannel experiences. Our competitors have risen to meet those needs. We have not. In some cases, as with our formulations, we have invested in these attributes, but we have not communicated them consistently and effectively.”
Bath & Body Works Acting with ‘Urgency and Clarity’
The Consumer First Formula will consist of:
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- Refocusing on innovation in core categories: B&BW will focus on reestablishing product leadership in its core categories of body care, home fragrance, soaps and sanitizers while making selective “category exits” in hair and men’s grooming products;
- Reigniting the brand through bolder, more targeted brand moments and deeper creator advocacy;
- Winning in the marketplace by meeting new consumers where they are, with the goal of making discovery effortless. The retailer already has refreshed its mobile app and, in early 2026, will invest in a permanently lower and more competitive free shipping threshold, as well as its entrance on Amazon; and
- Operating with speed and efficiency, breaking down silos and speeding up decision-making to help generate those $250 million in cost savings, half of which are identified for 2026.
“As a result of our no-regret moves that I outlined six months ago, some of our strategic actions are already visible to the consumer, but it will take time before we see the benefits in our financial performance,” said Heaf. Indeed, recent initiatives for the brand have included “scent takeovers” at high-profile holiday destinations like NYC’s Grand Central, the debut of kiosks at more than 600 college campuses and the launch of a new experiential store design.
“I believe that we have the foundation, the plan and the focus to deliver sustainable growth and shareholder value,” Heaf added. “We are acting with urgency and clarity, putting the consumer at the center of every decision.”
Bath & Body Works operates 2,400 stores globally and has 40 million active loyalty program members.
