Coach Wants To Transform From Light Luxury To Popular Fashion.

Used to monopolize the luxury market. American brand Coach is no longer a leader. Turn off the Beijing Xinguang Tiandi flagship store and turn to the old VO department store, the original creative director of the Spanish luxury Loewe, the increase of discounts and categories, and the crowd. Coach The fashion brand has been transformed into a popular fashion brand.

　　 Closing stores: reversing same store sales decline

According to Coach latest report, as of the first quarter of March 29th, North American same store sales fell 21%, which is the fourth consecutive quarter of brand decline. Forecast that as of June this fiscal year, Coach North American same store sales performance will double digit decline.

Faced with such a poor performance, Coach has decided to enter a long period of painful transition. The North American market is the first goal of "rectification". The company plans to shut down 70 poorly performing stores in North America, including stores and factory outlets, and turn it into a half year sales model to reduce marketing activities and better target its best customers. North America is the largest market for Coach, which accounts for 70% of the group's total revenue. It has 351 stores and 193 special stores in North America.

At the same time, Coach will shut down 5 online outlets to enhance shopping experience and reduce discounts. For the wholesale market, the brand will also strengthen the shopping experience, including the full display of exclusive brand, the promotion of customer experience and the production of wholesale products to meet the specific needs of the channel.

It is reported that this reform, Coach is expected to generate about 250 million -3 billion pre tax expenditure, which will be reflected in the fourth quarter of this fiscal year, and the rest in the new fiscal year.

In response, Coach global CEO Victor Luis told reporters: "after 12 years of growth, the competitive environment and consumer attitudes and ways to purchase luxury goods have undergone major changes. To meet the current challenges and create conditions for restarting sustainable growth, Coach will implement a series of comprehensive measures aimed at investing in brand and its relationship with consumers, making fashion innovation, enhancing marketing and improving the efficiency of all stores. "

　　 Digging feet: new design to create modern image

In addition to adjusting the market strategy, Coach has begun to change its design and brand identity. Not long ago, the group hired Stuart Vevers, the former creative director of Spanish luxury leather brand Loewe, to enhance the brand image and change the lifestyle brand. In this regard, the industry said that the domestic consumers from the pursuit of brand to personality pursuit of consumption change, from the Coach design point of view, can not meet the needs of consumers now, slightly old-fashioned and monotonous design contrary to the needs of consumers to express their own personality. To a certain extent, this reflects why American designer brand Michael Kors can rise rapidly in just a few years.

Victor Luis is also aware of this. He told reporters that the company hopes that with the talent and experience of Stuart Vevers, the company will lead the brand to launch a wider range of products, including handbags, shoes and garments, and create the image of Coach Women from head to toe.

It is reported that Coach hopes that brand positioning will be transformed into a "modern luxury" lifestyle brand from the "luxury of price". At the same time, brand hopes to bring consumers different shopping experience from "traditional luxury", and this experience depends on fashion sense. Stuart Vevers is confident that it will bring a thorough change to Coach. Recently, it said publicly, "I think the future of Coach is a brand that balances the practicality and luxury. Through the interpretation of New York elements, we can create a luxurious brand full of American market sentiment".

Zhou Ting, President of the Institute of wealth and quality, believes that Coach hopes to retake the focus of the market. It is far from enough to rely solely on changing design and combing sales channels. It said that the core issue in front of Coach is due to the upgrading of consumption, and consumer psychology is more mature in brand awareness and pays more attention to its individual needs. If the brand does not break through in the market business mode and innovation, it will be difficult to break through the fashion consumers.

Transformation: withdrawal of luxury goods stores and transfer to tide shops

Reporters learned that Coach recently closed its flagship store in Xinguang Tiandi and turned to Beijing's French Department of fashion fads. At the same time, Coach can be seen in fashion stores such as SOGO and Shuang an shopping malls. This is closely related to the past. LV GUCCI and other brand location strategies vary widely. It is not hard to see that brands are beginning to want to meet more consumers, and there are some changes in market positioning and sales people.

In this regard, Zhou Ting said, Coach from products, prices, shops and other places choose a strategy close to luxury goods, hoping to give consumers a big sense. But with the gradual transparency of information at home and abroad, consumers are questioning the "fake luxury". Coach switching to fashion stores can not only reduce operating costs, but also make sales groups more precise. People close to the Coach brand said that although Coach has achieved success in the Chinese market, it can not be taken lightly. The company will reestablish its business in China with the help of this transformation opportunity.

Statistics show that the sales momentum of Coach in the Greater China region is still strong, and the same store sales have two digit growth. Over the past few years, its brand ranking in China has changed from eighth to third, the largest single market apart from North America. Stuart Vevers admitted to reporters that China is still the biggest overseas market for Coach, which will bring Coach 1 billion dollars. Through a series of measures, it will have a more positive impact on the Chinese market. At the same time, Coach is also emerging in China. Luxury goods The market continues to expand rapidly.

At present, the international market accounts for 30% of the total sales of Coach. Besides the North American market, the other two markets are China and Japan.