Thursday, 28 October 2010

Coach Reports Excellent First Quarter Figures 28/10/10

Coach has reported impressive figures for its first-quarter net income. Rising 34 per cent, revenue has risen 20 per cent to $911.7 million, smashing expectations. Shares are at their highest since 2007, rising over 10 per cent. Coach’s results reaffirm reports that consumer spending is on its way back up.

Exciting things happening at Coach it seems, in perfect preparation for the holiday season. Having varied its strategy slightly, Coach is reportedly on the cusp of releasing new ranges, with a wider variety of sizes and prices. Though times are looking up for the luxury and premium industry, it seems that they are trying to reach a broader target market.

We have mixed feelings about this sort of thing here at the MO Down. Not because we don’t want Coach products to be more affordable (which largely they are) – we do. Our concern is twofold. One, we worry that with these sorts of initiatives brands might start to spread themselves too thin. Who are they marketing for? What happens if brand identity starts to slip below the sights of the premium market, but remain above mainstream taste? In other words, they could be placing themselves in brand limbo.

Second, as we have seen with collaborations, if premium labels appear suddenly able to produce products under the same name at a cheaper price, they create a dilemma for themselves. How do they maintain the quality image of their pricier ranges without causing consumers to question whether these products deserve their price tags? Identity is so crucial in the premium arena, we get cautious when it is toyed with.

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Who's behind the MO DOWN

Melinda O’Rourke is the founder and Director of MO Luxury, a dynamic, Sydney-based management firm specialising in luxury brands and services. Melinda and her associates at MO work with local and international brands across prestige retail, fashion, fine jewellery, timepieces and specialised services. Melinda is well-connected, well-read, and well-versed in the demands of the luxury market and its client base. Her advice is firmly based in objectivity and ultimately, accountability. Melinda offers constructive counsel and both strategic and creative thinking and is able to draw upon a strong network of specialised talent to compliment the MO Luxury team as needed. Melinda enjoys excellent industry relationships and is regularly quoted in the business and fashion media. Read more about MO Luxury,