Coach Is Closing 70 Full Price Stores

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#496
knightal said:
From today's earnings call:

http://www.wsj.com/articles/coachs-earnings-fall-less-than-expected-1422535765

"... his plans to improve the company’s results are working, citing increased sales at 20 remodeled stores that showcase Coach’s new image as a lifestyle brand that includes shoes, apparel and accessories in addition to handbags."

"As part of its repositioning, Coach has greatly curtailed promotions, which Mr. Luis said was partly to blame for the sharp sales decline. He added, however, that the company’s research showed that by offering fewer deals, it has started to regain its standing with consumers as a high-quality brand."
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This reminds me of a commercial I saw for that Brain Games show. There was a guy handing out samples of cake. One sample was supposedly for a $50 cake and the other was supposedly for a $15 cake. The people who tasted the samples thought the $50 one tasted better. The kicker was that both samples were from the same cake. The only difference was the price given for each sample. Apparently, higher numbers on the price tags trick our brains to perceive items as being better. Whether or not they are actually better is completely debatable.
 
#497
ArmCandyLuvr said:
This reminds me of a commercial I saw for that Brain Games show. There was a guy handing out samples of cake. One sample was supposedly for a $50 cake and the other was supposedly for a $15 cake. The people who tasted the samples thought the $50 one tasted better. The kicker was that both samples were from the same cake. The only difference was the price given for each sample. Apparently, higher numbers on the price tags trick our brains to perceive items as being better. Whether or not they are actually better is completely debatable.
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Price doesn't equal quality but i guess for some it's all about how much it costs even if a lower price item is of equal(or better) quality, that is somewhat of a rather sad reality.
 
#498
Alexa5 said:
I know that has been stated as one of the issues, but what it really came down to for Coach is that they began to have more competition over the years. And though there was a lot of talk from Coach about all of these upcoming changes about less sales and more exclusives and less lower priced bags, so far it has just been a bunch of chatter. Part of that is because they know that a lot of their sales come from reasonably priced merchandise. They will never suddenly turn into one of the higher end brands because they don't have the customer base for that.

If they truly changed their business model as they stated they were going to do, they would need to make sure they have enough new customers to make up for the many, many old customers they would lose. As of right now, many of the FP stores are fairly empty (yes there are some exceptions), so without those department store products and sales, I would suspect they would have quite a bit of inventory sitting around.

Also, Coach being on sale at a department store is no different than other name brands being on sale....when those department stores have a sale it is typically a limited exclusion sale that is offering sales on many of its brand names. Coach being excluded from that would not make Coach more appealing, it would only make it far less desired, imo.
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Coach was excluded from Macy's sales for years and I saw many more being carried than I do now that you can use coupons.
People can be so fickle when it comes to what's "hot".
 
#499
For me, Coach's problem is one of identity. They cannot decide if they want to be classic, trendy, mid-range, premier, exclusive luxury or affordable luxury. They are trying to be all of those things simultaneously right now which is causing them real image problems in my opinion.

They need to pick a niche and grow from there.
 
#500
ltbag said:
For me, Coach's problem is one of identity. They cannot decide if they want to be classic, trendy, mid-range, premier, exclusive luxury or affordable luxury. They are trying to be all of those things simultaneously right now which is causing them real image problems in my opinion.

They need to pick a niche and grow from there.
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VERY WELL said!!!
 
#501
ltbag said:
for me, coach's problem is one of identity. They cannot decide if they want to be classic, trendy, mid-range, premier, exclusive luxury or affordable luxury. They are trying to be all of those things simultaneously right now which is causing them real image problems in my opinion.

They need to pick a niche and grow from there.
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+1000
 
#502
Alexa5 said:
I know that has been stated as one of the issues, but what it really came down to for Coach is that they began to have more competition over the years. And though there was a lot of talk from Coach about all of these upcoming changes about less sales and more exclusives and less lower priced bags, so far it has just been a bunch of chatter. Part of that is because they know that a lot of their sales come from reasonably priced merchandise. They will never suddenly turn into one of the higher end brands because they don't have the customer base for that.

If they truly changed their business model as they stated they were going to do, they would need to make sure they have enough new customers to make up for the many, many old customers they would lose. As of right now, many of the FP stores are fairly empty (yes there are some exceptions), so without those department store products and sales, I would suspect they would have quite a bit of inventory sitting around.

Also, Coach being on sale at a department store is no different than other name brands being on sale....when those department stores have a sale it is typically a limited exclusion sale that is offering sales on many of its brand names. Coach being excluded from that would not make Coach more appealing, it would only make it far less desired, imo.
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I think they could be high end if they made the transition gradually...
 
#503
I agree that Coach is having somewhat of an identity crisis. I hope they can figure it out and not neglect the customer base that helped them grow thus far. That would be a shame.
 
#504
ltbag said:
For me, Coach's problem is one of identity. They cannot decide if they want to be classic, trendy, mid-range, premier, exclusive luxury or affordable luxury. They are trying to be all of those things simultaneously right now which is causing them real image problems in my opinion.

They need to pick a niche and grow from there.
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+10,000

The only thing I would like to add is that I, personally, would like a continuation of a lower priced, obviously differentiatially named, line. Although I do not have a lifestyle conducive to the proper care of elite, glove tanned bags, I am not oblivious to fashion.
 
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#507
Murphy47 said:
I think there should be a place for those of us who don't want to spend a mortgage payment on a bag that is stylish and well made.
Here's hoping.
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MK, Kate Spade, and plenty of others :p I just think if Coach could get back to its roots it could be made in the US, high end, and luxurious all while maintaining good quality and being the symbol of luxury it once was.
 
#508
lovingmybags said:
The marketing strategy may have worked for other brands, but I doubt it would with Coach. Mulberry tried to raise themselves up in the price range of LV, and failed miserably; they started cutting the cost of production (which is what I think Coach is doing now), while raising the prices. You can't believe that consumers won't really tell the difference; and if on top of that, if you limit the promotions, and the venues to shop these bags at, then in my opinion sales will plummet tremendously. Not every brand is cut out to be LV, Chanel, nor does it have to be, and Coach just has to search for their own identity. Trying to avoid competition with Kate Spade, Tory Burch, and MK by elevating its prices (but not quality), is only going to skewer them in the long run. The premier market is saturated enough already, and if they have to fight for the same clientele, without an established customer base (or originality+quality in their products to back them up)...it won't be a pretty picture.
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:goodpost:
 
#509
lvmk said:
MK, Kate Spade, and plenty of others :p I just think if Coach could get back to its roots it could be made in the US, high end, and luxurious all while maintaining good quality and being the symbol of luxury it once was.
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Ugh. My closest TJ Maxx may as well change its name to the Michael Korrs outlet; I can't believe they sell many bags at full price based on the number that show up there. Selmas, Hamiltons, etc. Kate Spade is a close second. The only Coach bags I see are MFF or Z prefix (made for Nordtrom Rack?). Thanks but no thanks on MK or KS. Lower priced secondary Coach line please! As far as I know, lines like Marc by Marc Jacobs and See by Celine don't hurt the parent companies at all.
 
#510
lvmk said:
I just think if Coach could get back to its roots it could be made in the US, high end, and luxurious all while maintaining good quality and being the symbol of luxury it once was.
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While i agree they are unsure who they are these days i don't see that happening, as i have said before the playing field is not the same, things are not like when they reigned before and because of this not all forms of past strategies will work.
 
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