An article in Seeking Alpha has suggested consumers may be swapping their Chanel for Coach, the so-called "accessible luxury brand” that has gone from strength to strength since going public in 2000.
Despite the tough economic times, Coach are the number one luxury accessories brand in the U.S. They have a strong following in Japan and plan to capture 10 percent of the Chinese market in 5 years (and with 27 stores already, they are well on their way).
The Seeking Alpha article, Coach: High Fashion At A Bargain Basement Price, praised Coach, saying, “The excellent management team at Coach is proven to possess a high level of knowledge and understanding of its customer base through superior customer research. As a result they have sustained a healthy business model by pricing their products as accessible luxuries while opening their market to ‘aspirational’ buyers. Customers who were buying the $2000-plus European luxury brands can still feel good with a stylish and high quality Coach purse at the $150 to $500 price points."
Could other brands learn from Coach? Definitely. At the MO Down, we always applaud 'superior customer research', knowledge of the consumer's needs and wants and purchasing habits – as this knowledge is fundamental to sustainability. This research needs to be ongoing and thorough, because if the brand is doing things right (clearly Coach is) they are attracting new consumers on a regular basis and their existing clients are evolving, so they maintain relevance and have one foot ahead. There’s nothing worse than trying to make amends when the horse has already bolted…