Coach Look Ahead And See How To Accomplish Pformation.

In recent years, market consumption habits have changed and new brands have been squeezing the market.

The brand pformation started from three aspects of product positioning, marketing and market channels to pform the Coach of the past luxury luxury leather brand into a high-end lifestyle brand.

Although the pformation is still in progress, sales in different markets around the world have been affected and shocked, but Coach has always wanted to make low-cost pformation to achieve the lowest customer loss.

The change in brand positioning is very taboo. When the new customers are not yet attracted, the brand will make the old customers feel strange.

2014 has been the cold winter of Coach, and sales declined continuously in the two quarter.

But on the day of the second quarter results of the 2014/2015 financial year in January, Coach rose 6.8% in the New York stock exchange so that the 38.94 dollar closed up, creating the largest increase since April 2013.

Since 2013, Coach, as a high-end lifestyle brand that contains handbags, clothing and accessories, is reappearing in front of the public. Although Coach has not changed the trend of overall weakness in the second quarter of the global market, customers have begun to accept Coach after the change, and the effect of brand pformation appears.

In the past more than 10 years, Coach has a distinctive brand positioning in North America, including the world, becoming a typical "affordable, accessible luxury".

In 2011, Coach occupied 40% of the market share in the American luxury handbag Market. It was also the largest brand of high-end handbags in the United States. In that year, 20% of Coach's total revenue came from overseas Japanese market, which was the peak of Coach development.

However, Coach takes account of the positioning of the upper and lower ends and is easy to meet competitors.

As more brands began to enter the middle of the market, new brands such as Ralph Lauren, Michael Kors and Kate Spade grew rapidly after 2013, squeezing the market share of Coach.

In 2013, Coach once faced enormous challenges. In the full fiscal year of 2014, Coach's global income fell by 5.3%.

In the face of changes in the consumption habits of the market, Coach also began to brand pformation in 2013, pforming the Coach of the past luxury leather brand into a high-end lifestyle brand from three aspects: product positioning, marketing and market channels.

Reshaping product positioning

In the second half of 2013, China's luxury consumption began to fall from its peak. In the first fiscal quarter report released in Coach for the 2014 fiscal year ended September 28, 2013, sales volume was $1 billion 150 million, up 2% from the same period last year, while the previous quarter's growth rate was 11%.

When the downward trend just showed up, Coach made a quick adjustment to the market in July 2013, and came up with the designer Stuart Vevers as the creative director from the Spanish leather brand Loewe.

As a new generation of designers in the luxury industry, Stuart Vevers has been serving brands such as Mulberry, Givenchy, Louis Vuitton, Calvin Klein and so on.

The new creative director has also brought new temperament to Coach.

In the past, Coach stores gave people an old-fashioned and conservative impression, and stores had only handbags and accessories. They were more suitable for professional women to use in formal occasions.

But now the Coach already has a wide range of handbags, shoes and garments, and even a lot of bleaching tannin rivet jacket, leather skirts, leopard leather baseball jacket and other younger elements of clothing.

In the original bag products, metal luster and rivets were also found, which made Coach young and energetic.

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Of course, the habit of Chinese consumers consuming luxury goods is changing.

Not everyone does not like the brand logo on the product. They still need to let others know that they are using brand branding, but the design and taste of logo or tag is very important.

Coach, the new president and CEO Yann Bozec of China, believes that "coach was originally a male leather product and inherited excellent technology, so Coach has strong confidence in the areas where customers are concerned."

He said,

"Now that Coach is adjusting its design style, it also emphasizes the quality of handwork and leather. The product is more in line with modern and luxurious positioning, but the promotion of this positioning is not achieved through price increase, but through the promotion of value."

If a Coach package in the past was priced at 6000 yuan, it would now fall on the same price level, but compared with the past, the supply chain of Coach has improved leather, detail and workmanship, and paid more attention to lathe work and accessories.

Of course, the price of Coach products is also on the original single level, adding a product category of 10000 yuan, adding more price levels to choose from.

Yann Bozec has been holding COO position in Coach before being appointed as China's new president, and in charge of the industry value chain. He said, "in fact, Coach has been improving its value chain over the years. By balancing the cost of large-scale purchases of gadgets, it can balance the risk of profit margins diluted by value enhancement".

Yann Bozec said, "I am confident that not only will the price increase, it will also give customers a better price performance, while raising value at the same price, without affecting the gross margin".

Prior to that, Coach, which was founded in New York in 1941, has a long history of inheritance. In the past global market, people's impression of Coach is a light luxury brand that specializes in producing bags. The main advantage of the market is the advantage of Coach in the past.

But after the pformation, Coach is more inclined to enhance its brand and fashion in many categories, and build itself into a brand with lifestyle inheritance.

Strengthening brand experience

The consumption mentality and habits of luxury goods are changing. They have strong learning ability. In the past, many people bought a luxury item to let people know that the bag was expensive and could display their identity.

But now the luxury consumption is more to express what kind of person he is, showing his personality and fashion.

A few years ago, Japanese guests were the most detail oriented guests. But now in the Coach store, many Chinese customers are talking about the material of the leather, asking what procedures are being made, and whether they are convenient to handle.

In addition, the Chinese market is becoming more and more diversified, Yann Bozec said. "In the past, sales data in Coach tend to be the highest sales of a package, but now we can see that sales data of several packages are flat."

Therefore, in view of the changes in market consumption habits, many brands still raise their sense of distance and exclusiveness through price increases. Coach's market strategy has gone a completely different way.

The way Coach chooses is to be more affinity and exquisite, and enhance the brand's yearning.

A month ago, the fashion data released by Baidu showed that the operation of luxury brand has gradually become an experience upgrading. Coach also follows the direction of brand pformation in the process of brand pformation.

Yann Bozec said, "Coach emphasizes customers' preference for brands and long-term interests".

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The change of brand communication is first reflected in stores. When revenue growth slows down or even falls, the pformation of stores is a risky choice of high cost.

But Yann Bozec believes that Coach now attaches great importance to customer experience. "Luxury sometimes is a feeling".

Coach expects to open about 60 new retail concept stores around the world in fiscal year 2015, and complete the upgrading of about 150 stores in 3 years.

Among them, 20 new stores will be opened in the mainland of China.

Refurbishment of the store also helped Coach pform its image from inside to outside. The newly renovated Coach storefront was completely different from before. The storefront was like a white box, but now it has become a "home". There are many sofa and other leisure designs in the newly opened Coach store in Xinguang new world of Beijing, adding more warm feelings.

If you go into the Coach store before then, customers will ask the question more often when they ask, "what do you need? Do you need to help you?"

But now if you enter the store of Coach's new light world, the waiter will ask the dessert on the side tray, "do you want to taste this?"

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There will be more flexible interaction between the service staff and customers in the shop, talking about the current popular fashion topics. What is the most popular trend now? These Coach attach great importance to improving the brand's yearning and love degree in the process of brand pformation.

"If the old feeling is to make you excited, go shopping, and now it will make you comfortable."

Reconstructing channels

In the Chinese market, besides the aesthetic changes in the taste of design, the obvious change of consumption is electronic commerce. The development of Hai Tao has brought great challenges to all international brands. Coach can not be avoided, of course.

But Coach responded quickly.

In China, Coach already has its own WeChat and micro-blog team, and has its own data platform in the world.

In the second quarter earnings report Coach released in January 2015, Coach announced that it would strengthen the global marketing and digital team to extend the responsibilities of the current Coach global digital and customer experience President David Duplantis to manage global marketing and customer intelligence analysis.

Digitalization is also listed as one of the key points in the 2015 global strategy. However, the digitalization of Coach not only represents the setup of online shopping platforms, but also the utilization of digital platforms as a whole.

Coach digital team action usually requires all departments to cooperate, for example.