Case Study : Coach Inc.

The following case analysis will assess Coach Inc. and its strategy in the accessible luxury brand goods market. The coach strategy focuses on its luxury rivals in matching key quality styles while offering it at a cheaper price. The company offers most products at a 50% off discount price less than other brands which gives them a competitive advantage pertaining to its customer base. Coach marketed its products to middle –income consumers desiring taste of luxury, but also affluent and wealthy consumers with means to spend considerably more on a handbag (Gamble, 2012. P.C-73) .The Company also has several other strategies such as to increase global distribution, improve same store sales productivity and continue its multi-channel business model which includes indirect whole sales to third party retailers but also focuses on direct consumer sales. Coach has done well in the luxury goods industry but the companies profit margin is still below the levels achieved prior to the onset of a slowing economy in 2007 ( Gamble, 2012. P.C-73.The Company had experienced a decline in sales as they are unsure if the company recent growth could remain constant and maintain their competitive advantage with other successful luxury lines Michael Kors, Salvatore Ferragamo, Prada and Dolce & Gabbana.

Coach created the “accessible” luxury category in ladies ‘handbags and leather accessories by matching key luxury rivals on quality and styling, while beating them on price by 50 percent or more. Beyond its winning combination of styling, quality, provided by its employees contributed to its competitive advantage.

o They adapted to the fact that women usually use bags to complement their wardrobes the same way the used to use shoes.

Coach Inc. is one of the dominating brands that are in the leading position of the affordable-luxury handbag market in relations to the overall annual sales results, but at the same time it faces harsh rivalry from its competitors. Some of the direct competitors in the North American market, such as for example Michael Kors or Kate Spade, have seen a drastic increase in popularity as of late, giving rise of concerns over Coach’s future market share. At the same time, Coach has strug-gled alot to compete against many of the leading European fashion companies such as Salvatore Ferragamo, Armani, Versace, Louis Vuitton, Gucci, and Longchamp. The

The Tiffany & Company is introducing a new product line by the name of Tiffany 's Essentials. The line will offer authentic luxury designer handbags along the lines of Gucci, Chloe, Dior, Fendi, Prada and many more. As concept of luxury changes, marketers of high-end products are wrestling with the challenges of maintaining exclusivity while obtaining higher sales. Having a well-known name as Tiffany and Company we have no limitations to create luxury pieces for the luxury lifestyles. The following paper will emphasize our product, our target market and our marketing objectives as to how we will market our handbag using a vital marketing mix. It will also provide our major competition in both the diamond industry as well

Coach has built its business based on their ability to minimize their cost while maximizing their customers perceived value. In order to minimize their cost, Coach found it most cost effective to outsource their manufacturing overseas. With such a far distance between their home location in the United States and their manufactured products, Coach implemented management controls near the locations of production. This helped ensure that production runs smoothly and that the quality of the products was up to Coach’s high standards. Coach also has a large amount of stores in Asia and India where a large amount of their manufacturing occurs. Having such close proximity to those stores allows Coach to minimize the risk of

Many aspects within the luxury goods industry point to the competitive forces from new entrants being moderately high. Healthy earnings from competitors indicate an ease of entrance for newcomers in the industry. The industry’s annual revenue figures as well as an emphasis on brand name and P/Q rating, place the industry at low risk of failure. Two other factors that contribute to the ease of entry for newcomers in the industry are a large pool of entry candidates and relatively small capital requirements.

Coach Inc. (Coach) was founded in 1941 by Miles Cahn in New York. Coach had a humble beginning as a family business selling quality artisan handbags, and has grown to a well-known luxury brand. Sara Lee (a food and consumer goods producer), acquired Coach in 1985, and in 2000 the company was listed on the New York Stock Exchange. Sara Lee sold Coach 's existing shares in 2001 and has since split into two companies, one of which forms Hillshire Brands (Soni, 2015).

Luxury goods serve a purpose that extends way beyond functionality and need. A bag that costs $15,000 or a pair of shoes priced at $500 does not necessarily signal that they perform better than goods priced significantly lower. The disproportionate prices of luxury goods reflect so much more than the eye can see, the history behind the brand, the story that it tells, and the scarcity and exclusivity it aims to achieve in the mind of the consumer. A premium brand, by contrast, can generally be described as a good that a customer pays more for because they are getting higher quality product. Luxury brands are not inherently inferior because they do not offer higher functionality. Sometime signaling the belonging to an exclusive group is important to a person, and thus worth the monetary cost. A premium product, though, is a good that people are willing to pay more because they believe they get more, whether that is higher quality or better performance. A customer does not purchase a luxury product because they know it will perform better, they purchase it because of the status and appearance that it signals to those around them.

Globalisation has been a significant factor towards to increase in consumer demand towards luxury brands. Increased travel and greater technology such as the internet, and the media are all driving forces which has lead to increased consumer demand, and contributed towards homogonised customer needs. Expansion of luxury brands globally has significantly been driven by increase of wealth in emering markets, such as Asia and India. (Nueno and Quelch (1998). Furthermore due to recession of population growth in Europe, which holds a large percentage of sales of luxury brands, many of these brands are rapidly expanding their operations to cater to affluent Asian consumers who regard Western luxury brands as a statement of good taste (Nueno and Quelch, 1998).

One of the most significant barriers comprises the brand equityenjoyed by most established brands. The repute of the brand is extremely important to customers; luxury brands such as Jaguar, Mercedes-Benz, BMW and Audi have a long and magnificent history to boast about, and the companies work hard to preserve the association between them and other symbols of individuality and of top-notch quality and performance.

The fashion industry is very competitive. Company that venture in fashion should therefore have a proper marketing strategies that will make it have competitive advantage over the other companies. Most companies engaging in fashion have therefore turned to luxury brands being that there is global interest in fashion. Based on the environment that the businesses operate, the target markets and product attributes as well as marketing methods, the companies have embraced luxury brand management and fashion marketing strategies that have made them be on top of the fashion industry. This paper looks

Economic: Developed markets pose a risk to the luxury industry, however emerging markets such as China and India present opportunity for Coach as their middle class’s continue to grow.

Signified by two interweaving C’s, Coach Inc., has established itself as a fashion brand structured around modern designs and quality leather. Founded in a New York City loft in 1941, Coach has consistently delivered its customers luxury leather goods backed by great customer service, which has helped lead to its success 73 years later. Coach has attributed much of their success to modern designs and integrated marketing strategies, which keep their customers involved. Primarily focused on women’s handbags, Coach has started expanding its market to men’s apparel and shoes in recent years. A well-established reputation and business, Coach still have many areas to improve upon, and these opportunities will be explored in this paper.

The objective of this report is to understand the manner in which the global luxury brands are residing or extending their reach worldwide. It is also focused on the manner in which the brands are creating a deeper brand value and making the customers to engage with their brand. The other aspect that is being focused is regarding the company B&O which has managed to expand its business by adapting to varied cultures of the markets in which it has diversified its business. It has also focused on the manner in which the various brands have diversified into various markets. The prime comparison has been drawn between B&O,Harman House and Apple and it is observed that the products of B&O are considered to be more technologically superior to Harman House.