Coach Is Closing 70 Full Price Stores

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#91
ildera5 said:
It is funny, I don't find that The Bay has great deals here. Sometimes they have 25% off, but that is usually on older stock and those I have found at the outlet for better deals.

Even if we only had to pay for shipping, I *might* consider ordering online (esp. if they said, something like, spend over $200 and it is free), but the duty, No Way!

:smile1:
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Maybe it doesn't take much to make me happy? I find 25% off lots of new stock but what really helps, of course, is when they do the additional 20% off last ticketed price. The stuff that is "only" 25% off but makes me happy has been the Borough bags :)
 
#92
I hate how they are trying to get people to think they are privileged to purchase coach at a discount. Please. Maybe people that have never bought before will think this. But they will lose their loyal returning customers.
 
#94
chantal1922 said:
The head honchos at Coach need to study this thread!
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The thing that scares me is that the people running this business really have no idea who the brand's core customers are and what they want. IMO, THAT'S why their stock is dropping and they are floundering. They are failing because they are trying to be something they are not. Coach has always been an affordable luxury brand. It's not Chanel, Dior or LV, nor does it need to be.

Business 101 teaches us that it costs far more to acquire a new customer than it does to keep an existing one--loyal customers repeat purchase, gift for friends and refer others to the brand. I wonder-- what kind of market research do they do? Are the new guard actually talking to existing customers, top SAs and loyal customers who have hopped to MK, KS or other brands? I don't think they do.

I have carried Coach for 20+ years. I love the brand and hope they do well, but I worry that there is an arrogance that is counting too much on the cash flow created by the outlets to float this new upscale design dream. I just don't think there are going to be enough of the new upscale customers to make up for the lost loyal ones.
 
#95
melissatrv said:
I knew this was coming.


Those on here a while probably remember Coach's glory years, when the stock shot way up? Think about what was going on at that time



  • Coach had a VERY successful Madison line (Sophia/Sabrina days)
  • PCE was not what it has been....every other week. PCE was done usually quarterly. And it really gave you something to look forward to
  • There were no Facebook coupons. Not sure if there was FB and if so it did not enjoy the mainstream popularity it does now
  • There were no FOS sales every week because here was no Factory Online Sale
  • Then when they started FOS, it was not every week. Again like the old PCE you had something to look forward to. Sometimes I don't even check FOS anymore,. I will just see the same stuff I saw last week. Price might fluctuate though
  • Deletes would take 6 months to go to the outlet. But they were there and all outlets got them not just flagship. There were always some outlets that got more but even the smaller outlets still got some
  • Which deletes the outlets got was not predictable either. It was a nice surprise what you might find....like a treasure hunt. And every once in a while you would find a bag from a couple years ago. Not returns, Coach would just all of sudden open the vault. Remember ladies how busy Saturdays and Sundays used to be here with all the outlet reveals?
  • Now it is standard that outlets always have an additional % off coupon when you walk in - then they did not. If they had a coupon it was a surprise. And you took advantage when they did have a coupon because you did not know when they would have them again
  • They were not making MFF bags in mass that were based on full price styles
And my personal pet peeve, they made great bags in medium size. Coach continues to almost exclusively make large bags and mini bags now.

This model worked. This model got people excited about Coach. Then they diluted the brand with constant PCEs and FB coupons, constant FOS, limited outlet deletes and only to flagship stores, MFF bags modeled on FP styles....they got crazy. Now they are going to the extreme with the new plan which I think will bite them. Why don't they look at what was working, what was going on when things were good and re-visit that?
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You hit the nail right on the head.
 
#96
TejasMama said:
The thing that scares me is that the people running this business really have no idea who the brand's core customers are and what they want. IMO, THAT'S why their stock is dropping and they are floundering. They are failing because they are trying to be something they are not. Coach has always been an affordable luxury brand. It's not Chanel, Dior or LV, nor does it need to be.

Business 101 teaches us that it costs far more to acquire a new customer than it does to keep an existing one--loyal customers repeat purchase, gift for friends and refer others to the brand. I wonder-- what kind of market research do they do? Are the new guard actually talking to existing customers, top SAs and loyal customers who have hopped to MK, KS or other brands? I don't think they do.

I have carried Coach for 20+ years. I love the brand and hope they do well, but I worry that there is an arrogance that is counting too much on the cash flow created by the outlets to float this new upscale design dream. I just don't think there are going to be enough of the new upscale customers to make up for the lost loyal ones.
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I totally agree with this post. :smile1:

Coach cannot possibly sell enough of their new full-price, non-discounted, totally-new-designer bags to make up for all the long term customers they are losing.

This is especially true now that there will be 70 less stores to sell these bags in.

If Coach understood its customer base it would not be making these desperate, erratic moves. But then again, it sounds like Coach wants an entirely new customer base and does not care if any of us stay with Coach or not.
 
#97
NotSurprised said:
Coach will continue to have a difficult time because the middle class is losing their ability to buy. Middle class folks can't splurge a lot and the one area they will treat themselves is a luxury purse..not a fancy car, expensive clothes, or home furnishing....but a purse.. verified by research. This customer base is facing a harsh future in America. Unemployment is growing.
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Yes, this is at the crux of the issue and Coach is not the only brand having issues. Many companies are scrambling to survive in this economy. Middle class disposable income in the US is shrinking fast. The news doesn't report it but it's a fact. Mix that with corporate mis -management and bad marketing decisions and bad things happen.
 
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#99
chantal1922 said:
The head honchos at Coach need to study this thread!
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I think even if they did, they would be indifferent to anything except what their analysts tell them. They probably think even negative news is a form of publicity (like their no-brow models). What next, COH stock in the FOS Clearance section?

Anyone think if this continues, Coach is ripe for a takeover? Once they shed their excess, they'll still need time to regain traction and may be just the thing for a European brand or maybe a clothing line looking to expand into the US middleclass market. LVMH perhaps?
 
#100
petite_chic said:
I think even if they did, they would be indifferent to anything except what their analysts tell them. They probably think even negative news is a form of publicity (like their no-brow models). What next, COH stock in the FOS Clearance section?

Anyone think if this continues, Coach is ripe for a takeover? Once they shed their excess, they'll still need time to regain traction and may be just the thing for a European brand or maybe a clothing line looking to expand into the US middleclass market. LVMH perhaps?
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LV might not want to buy Coach until after they finish suing them...........

http://www.purseblog.com/coach/louis-vuitton-suing-coach-ex-vps-trade-secrets-leak.html
 
#101
ltbag said:
I totally agree with this post. :smile1:

Coach cannot possibly sell enough of their new full-price, non-discounted, totally-new-designer bags to make up for all the long term customers they are losing.

This is especially true now that there will be 70 less stores to sell these bags in.

If Coach understood its customer base it would not be making these desperate, erratic moves. But then again, it sounds like Coach wants an entirely new customer base and does not care if any of us stay with Coach or not.
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Actually I think its a smart move to close a lot of these stores (although I feel horrible for the people who are going to lose their jobs) Coach has too many stores open, especially in certain areas. I myself am in FL, and where I am there are 5 coach stores within a 40 mile radius, and one just closed this past january. That is far too many. There are 3 or 4 mk and tory burch boutiques in the entire state! I think its smart of them to close some stores focus on the ones that are actually making money. Just like a lot of you have said your coach boutiques are dead, and the ones not making money shouldnt be open. I also heard that their going to turn a lot of stores into flagship stores, and more stores will carry some of the more exclusive pieces. I completely agree that the brand has diluted itself and completely ruined itself with the excessive pce and fos!
 
#102
ltbag said:
I totally agree with this post. :smile1:

Coach cannot possibly sell enough of their new full-price, non-discounted, totally-new-designer bags to make up for all the long term customers they are losing.

This is especially true now that there will be 70 less stores to sell these bags in.

If Coach understood its customer base it would not be making these desperate, erratic moves. But then again, it sounds like Coach wants an entirely new customer base and does not care if any of us stay with Coach or not.
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Agreed with all of this. I don't know if there are any walking dead fans out there, but I just keep thinking is coach "too far gone" ie too far removed from the luxury market they appear to be targeting. I think the quality and originality/ aesthetic of their new releases may get them something of a new customer base (or returned customers after years of not buying), but personally I know Ive been conditioned to wait for a deal, because if they have been consistent in anything it's discounting their merchandise. Those that did buy the borough without pce are probably giving a second thought to doing that again, because coach fell back into their discounting ways in less than 6 months (not to mention the dept stores that were discounting way before that), so I agree that the customers that will still buy fp has to be relatively low and will certainly not bring the profit they need (unless they have also made extensive cuts to the bottom line, which could be the case as some have noted the new styles aren't as thick as legacy leather).

Although, I do appreciate them taking a new direction rather than continuing the same cycles and expecting a different outcome, what I've read so far seems to be a direction that will not be very lucrative. I'm guessing the store closures will link to lesser volume production, which should be beneficial, but seems to also be part of the problem that they either don't know the market and what they can expect to sell, or don't care because they know they can at least move the inventory at 50% off at some point, and may even plan for that. I would be interested to see the business case and revenue/ p&l estimates that validated these decisions, with so many jobs on the line (sales as well as manufacturing/
distribution) I really hope the decision was well thought out.
 
#104
melissatrv said:
And my personal pet peeve, they made great bags in medium size. Coach continues to almost exclusively make large bags and mini bags now.
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This, this, this! I don't understand why everything is a crossbody or a giant tote. The last time I stopped by my outlet, I felt like Goldilocks. The few medium-bodied bags that exist have ridiculously tiny handles and/or crossbody straps.
 
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