Coach Is Closing 70 Full Price Stores
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Melissatrv, all of your posts are thought-provoking and insightful, as always. Vesperholly, good ideas there!
Meanwhile, I like the Poppy idea. Led me to think about another brand name idea. What about having "Coach 1941" as the brand/store name for the FP boutiques? And a marketing push (and actual use of) reminding shoppers of the thick, chewy leather that led people to buy Coach "back in the day" to formulate a high quality, aspirational luxury brand again? Just a thought.
Meanwhile, I'm doing a lot of watching, listening, etc as I ponder my collecting. Time will tell. I do love that new olive hobo! Abwd and princess69 are great enablers, I must say, for that bag.
Off to the boutique in a few mins, in fact. Looking forward to it!
Coach was my first luxury brand back in the 90s, and back then it was truly luxury. The craftsmanship and leather were superb, there were no outlets, or different levels of quality. I purchased one bag at an outlet a few years back for less then half of what I paid for a bag in the 90s. It is awful. Once Coach started cutting corners and costs my interest was lost, I also never liked their monogram. I'm not typically a fan of carrying what's trendy and everyone else has, which probably explains why I'm not a MK fan either. I really hope they return to producing the type of luxury product they once offered. Personally I feel the outlets, sales etc have really cheapened their image. Just charge what it's worth like LV. Maybe that's the trade secrets they were after?
I think Coach abandoned Madison a long time ago. The Madisons they put out starting with Madeline and onward, look absolutely nothing like the Madisons I loved.....Sabrina, Sophia, Audrey, Madison Shoulder Bags etc. And the most recent Poppy looks nothing like the original bold, designs that targeted the young and young at heart....the Sequin Spotlights, and colorful patterns. I get that everything evolves a bit. But they did a complete 360, the only thing they kept were the names.
And even though I hated Legacy it was a very popular line that the majority seemed to like. So I don't think they should abandon any of these, but wish they would go back to the old Madison and Poppy or at least make them edgier.
I really like that idea. To rename the full price line instead of the outlet line. That way the outlet shoppers will still get a Coach and it adds an air of exclusivity to the boutique bags. The full price shoppers will know they bought from part of an elite collection. All while still keeping the Coach name in both lines. I also think Siggys should be sold exclusively in the outlets. Again if they want their FP shoppers to not think of Cs when they see/hear Coach....no offense against Siggy, I have a few Siggy and Op Art bags that were FP but I think it follows their new strategic plan and is in line with what the analysts say
While shopping at Macy's today in Buffalo (McKinley Mall), I noticed that ALL of their Coach merchandise (which they only started carrying recently) was on a 25% discount and set up rather haphazardly on a table...not locked up, corded together- anything. There were 4 or 5 black Phoebe bags, a few messenger bags, and one or two siggy-print cross bodies....I just couldn't believe the set-up; or lack of set-up I should say. Surrounding this miserable display were many well organized tables and racks of Michael Kors, Dooney & Bourke, Calvin Klein, Guess and more. I do hope this doesn't become typical of Macy's stores. Granted it was just the one I visited...but I was truly disappointed....and hope this is NOT a sign of things to come as Coach reorganizes and closes some of their stores....
Macy's in Santa Rosa CA (both of them) were pretty tragic as far as Coach selections also.
Weird that they don't at least have the tethers on them. My local Macy's has a counter with glass cases for Coach, but there are bags that are also on racks that lock the bag down. I seem to recall an SA saying that Coach requires them to keep the bags locked down. Usually, the only items that aren't locked down are some wristlets and phone cases that are on clearance.
They closed the Destiny location in Syracuse, NY. The next closest Coach full price store is now 3 hours away.
Somehow I missed this bit! Most of my bags are Madison or Legacy, more recent Madison because I missed the others while I was 'away' from Coach. 2/3 of their revenue and they are just dumping it? Oi!
I made a thread out of this , but I'll also post t in here
http://forum.purseblog.com/coach/coach-brand-problems-called-out-in-2005-a-872560.html
http://www.businessweek.com/stories/...it-personality
BW 50: Coach's Split Personality
November 06, 2005
While Other Fashion brands fret over whether consumers will reach for their wallets this holiday season, Coach Inc. () is already feeling festive. On Oct. 25 the New York handbag maker announced its 14th straight quarter of double-digit growth in existing stores. Fueling that growth are customers such as New York public-relations executive Andrea Martin, who keep coming back for fresh iterations of weekend bags, wallets, wristlets, and more, often dropping hundreds of dollars to ensure that their purses match their pants each season. "It's not such a splurge for something you can use a few times a week," says Martin, who already owns three Coach bags. "The quality of their stuff is amazing."
Coach has expertly managed its brand to reinforce that upscale image. But fashionistas like Martin might be shocked to learn that the fastest-growing part of Coach's business these days is the factory store. That's where Coach sells off last season's accessories or irregular products at discounts of about a quarter off. Sales in those outlets grew 36% in the past quarter, vs. 14% in full-price stores. Overall, quarterly sales grew 30%, to $449 million, and earnings jumped 48%. Coach's torrid growth streak helped earn it the No. 17 spot on the BusinessWeek 50 list of top corporate performers.
The challenge now is to make sure the rapid growth in the bargain-bin end of the business doesn't dilute the luxury feel of the Coach brand. After all, brands from Calvin Klein () to Tommy Hilfiger () took an image dive when their goods drifted too far into discount channels. But that won't happen to Coach, vows Chairman and Chief Executive Officer Lew Frankfort.
LOYAL UP AND DOWN
For one thing, he has developed a strategy that strictly separates fashion-forward Coach fans from the ones who love snapping up out-of-date gear on the cheap. The company's 85 factory outlets are normally located at least an hour's drive or 60 miles from its 199 full-price stores. Because Coach never offers discounts in its regular stores or via the Web -- and doesn't allow department stores to mark down Coach goods either -- those who want bargain-priced products can get them only at outlets. And they won't get access to the latest products, which are rolled out each month in regular stores. Instead, they get discontinued models or older styles that are manufactured specifically for outlets. "It allows [Coach] to dispose of items that don't work, in a very different channel," says Kurt Barnard, president of Barnard Retail Consulting Group.
As a result, there's very little overlap between shoppers at opposite ends of the spectrum. According to Coach's consumer research, the average full-price shopper is 35, college-educated, and a single or newly married working woman. Factory outlet shoppers are, on average, 45, college-educated, married, and likely to spend 80% of their Coach dollars at outlets. "They're as brand-loyal as our full-price shoppers," says Frankfort, who notes that outlet fans drop about $770 a year on Coach products, vs. the full-price average of $1,100. "These are professional moms who want beautiful, well-made brands at low prices." Having this fall's gold-pleated Hobo bag or coyote fur-lined pocket duffel isn't a top priority.
UPSCALE FLAGSHIPS
At the same time, those who do covet the latest fashions continue to find satisfaction in Coach. The beauty of the brand, according to Barnard, is its positioning as an ultra-luxe label that nevertheless boasts relatively reasonable price tags. Though Coach sells a python satchel for $1,900, that's a relative bargain compared with a $14,800 crocodile bag from Gucci. Coach bags typically cost around $200 to $400. Yet a lot of buyers put it alongside names such as Gucci, Versace, and Dior. What makes Coach shoppers feel like they are in the same league as those tony names are the goods' quality and eye-pleasing designs, as well as the luxurious stores where they are sold.
In order to drive home those upscale associations, Frankfort is putting chic flagship stores in some of the world's most expensive retail real estate. The company is opening massive stores this November on Beverly Hills' Rodeo Drive and New York's Madison Avenue. "The flagship serves as a beacon for the brand," says the Coach chief. Still, the bulk of stores are in more modest locations that pump out the hottest new products. That's the right strategy, says retail real estate consultant Steven Greenberg, who argues that too many companies go flagship-crazy at the expense of the bottom line. Coach, he says, "is extremely prudent."
Still, Frankfort's hopes are clearly pinned on wooing those Coach shoppers who crave the trendiest bags and accessories. He credits the fast growth in the factory channel with a fresh effort to upgrade merchandise there. He expects the number of outlets to top out at around 100, while the full-price universe easily could reach 350 stores in North America over the next several years. "Our destiny lies in our ability to grow full-price stores," he says. That's why the two new palatial flagships are crucial to Frankfort -- to keep the brand image strong and sales even stronger.
http://forum.purseblog.com/coach/coach-brand-problems-called-out-in-2005-a-872560.html
http://www.businessweek.com/stories/...it-personality
BW 50: Coach's Split Personality
November 06, 2005
While Other Fashion brands fret over whether consumers will reach for their wallets this holiday season, Coach Inc. () is already feeling festive. On Oct. 25 the New York handbag maker announced its 14th straight quarter of double-digit growth in existing stores. Fueling that growth are customers such as New York public-relations executive Andrea Martin, who keep coming back for fresh iterations of weekend bags, wallets, wristlets, and more, often dropping hundreds of dollars to ensure that their purses match their pants each season. "It's not such a splurge for something you can use a few times a week," says Martin, who already owns three Coach bags. "The quality of their stuff is amazing."
Coach has expertly managed its brand to reinforce that upscale image. But fashionistas like Martin might be shocked to learn that the fastest-growing part of Coach's business these days is the factory store. That's where Coach sells off last season's accessories or irregular products at discounts of about a quarter off. Sales in those outlets grew 36% in the past quarter, vs. 14% in full-price stores. Overall, quarterly sales grew 30%, to $449 million, and earnings jumped 48%. Coach's torrid growth streak helped earn it the No. 17 spot on the BusinessWeek 50 list of top corporate performers.
The challenge now is to make sure the rapid growth in the bargain-bin end of the business doesn't dilute the luxury feel of the Coach brand. After all, brands from Calvin Klein () to Tommy Hilfiger () took an image dive when their goods drifted too far into discount channels. But that won't happen to Coach, vows Chairman and Chief Executive Officer Lew Frankfort.
LOYAL UP AND DOWN
For one thing, he has developed a strategy that strictly separates fashion-forward Coach fans from the ones who love snapping up out-of-date gear on the cheap. The company's 85 factory outlets are normally located at least an hour's drive or 60 miles from its 199 full-price stores. Because Coach never offers discounts in its regular stores or via the Web -- and doesn't allow department stores to mark down Coach goods either -- those who want bargain-priced products can get them only at outlets. And they won't get access to the latest products, which are rolled out each month in regular stores. Instead, they get discontinued models or older styles that are manufactured specifically for outlets. "It allows [Coach] to dispose of items that don't work, in a very different channel," says Kurt Barnard, president of Barnard Retail Consulting Group.
As a result, there's very little overlap between shoppers at opposite ends of the spectrum. According to Coach's consumer research, the average full-price shopper is 35, college-educated, and a single or newly married working woman. Factory outlet shoppers are, on average, 45, college-educated, married, and likely to spend 80% of their Coach dollars at outlets. "They're as brand-loyal as our full-price shoppers," says Frankfort, who notes that outlet fans drop about $770 a year on Coach products, vs. the full-price average of $1,100. "These are professional moms who want beautiful, well-made brands at low prices." Having this fall's gold-pleated Hobo bag or coyote fur-lined pocket duffel isn't a top priority.
UPSCALE FLAGSHIPS
At the same time, those who do covet the latest fashions continue to find satisfaction in Coach. The beauty of the brand, according to Barnard, is its positioning as an ultra-luxe label that nevertheless boasts relatively reasonable price tags. Though Coach sells a python satchel for $1,900, that's a relative bargain compared with a $14,800 crocodile bag from Gucci. Coach bags typically cost around $200 to $400. Yet a lot of buyers put it alongside names such as Gucci, Versace, and Dior. What makes Coach shoppers feel like they are in the same league as those tony names are the goods' quality and eye-pleasing designs, as well as the luxurious stores where they are sold.
In order to drive home those upscale associations, Frankfort is putting chic flagship stores in some of the world's most expensive retail real estate. The company is opening massive stores this November on Beverly Hills' Rodeo Drive and New York's Madison Avenue. "The flagship serves as a beacon for the brand," says the Coach chief. Still, the bulk of stores are in more modest locations that pump out the hottest new products. That's the right strategy, says retail real estate consultant Steven Greenberg, who argues that too many companies go flagship-crazy at the expense of the bottom line. Coach, he says, "is extremely prudent."
Still, Frankfort's hopes are clearly pinned on wooing those Coach shoppers who crave the trendiest bags and accessories. He credits the fast growth in the factory channel with a fresh effort to upgrade merchandise there. He expects the number of outlets to top out at around 100, while the full-price universe easily could reach 350 stores in North America over the next several years. "Our destiny lies in our ability to grow full-price stores," he says. That's why the two new palatial flagships are crucial to Frankfort -- to keep the brand image strong and sales even stronger.
This is sad news - the optics of this are just terrible! It just illustrates that mgmt./staff at Macy's are saying: let's get rid of this heap of bags that nobody wants because its stock has plummeted (literally).
I wonder what's going to happen locally? I have often felt that there are too many Coach boutiques too close in proximity but we don't have major outlets.