Market Analysis : Handbags And Leather Accessories Market

781 WordsFeb 6, 20174 Pages
Market Description • Handbag and leather accessories market • Retail market for global luxury goods Market Size • $96 billion in 2013 • In 2013, 36% sales in the US, 21% sales in Europe, 16% sales in Japan, 11% sales in China Market Growth • Affected considerably by market conditions (financial crisis had 0.6% annual decline in sales) • Growth in China and other emerging markets expected increase sales by 7.8% in 2015, reaching $350 billion o Asia Pacific region expected to be the largest market for luxury goods by 2018 Market Players and Scope of Rivalry • Divided into three main categories o 1) Haute Couture – highest end, most exclusive, custom for wealthiest (Prada, Burberry, Hermes, Gucci, Polo Ralph Lauren, Calvin Klein, and Louis…show more content…
g • Several: Coach, Michael Kors, Kate Spade • Coach uses e-commerce strategy including invitation-only factory flash sites and third-party flash sites; global lifestyle brand • Michael Kors: two primary collections include the luxury collection and the accessible luxury collection (designed to appeal for younger customers); strategy in 2014 focused on brand awareness, expansion of retail store base in North America, increasing comparable store sales, and expansion internationally • Kate Spade owns a jewelry group, and had owned Juicy Couture and Lucky Brand; achieved industry-leading growth in 2013; focused on having additional product category licenses, and international expansion Substitutes: Moderate • Customers can purchase used products • Customers can choose to purchase low-quality products (Target, Wal-Mart, etc.) • Customers can choose to purchase handbags and accessories from boutiques that don’t have the brand name Threat of New Entrants: Weak • Very difficult to develop brand name recognition/customer loyalty • Expensive startup costs • New entrants are strong when looking at boutiques Buyer Pressure: Weak • Customers are easily able to see prices from different shops due to online sales • Outlet stores and the constantly evolving fashion trends can make prices for last season significantly lower Supplier Pressure: Moderate • Suppliers can easily increase costs because luxury items require high-quality materials • Operating expenses for new locations are

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