Coach, Inc. is an American leather goods company known for ladies' and men's handbags, as well as items such as luggage, briefcases, wallets and other accessories (belts, shoes, scarves, umbrellas, sunglasses, key chains, etc.). Coach also offers watches and footwear.
Coach, Inc. is a designer, producer, and marketer of a prestige line of handbags, briefcases, luggage, and accessories. The company made its reputation selling sturdy leather purses in unchanging, traditional, classic styles, and it remains one of the best-known leather brands in the United States and has a growing reputation overseas.
In addition to its main product line, the company offers Coach brand watches, footwear, and home and office furniture through agreements with licensing partners. Nearly two-thirds of company sales are derived from direct-to-consumer channels.
These include about 190 Coach stores in the United States--of these, approximately 120 are retail stores and the remainder are factory outlets--direct mail catalogs, and an online store. There are also 175 Coach locations outside the United States, in 18 countries.
The company's indirect channels include the wholesaling of Coach brand products to approximately 1,400 department and specialty store locations in the United States. Formed in 1941, Coach was family owned and operated until 1985, when Sara Lee Corporation purchased the firm. Coach remained a subsidiary of Sara Lee until 2001, when the firm regained its independence via a spinoff.
SWOT ANALYSIS OF COACH.INC
Strong brand equity
Strong financial performance
Aspirational brands outperform the market in tough economic environment
Multi-channel retail network
Matching key luxury rivals on high quality leather and innovative styling
Beating competitors price by 50% or more
High level of customer service
Monthly introductions of fresh new handbag designs
Strategic alliances to bring Coach brand of handbags into luxury categories such as: watches, footwear, glasses, fragrances outerwear, and mens
Outsourcing to cut cost and maintain low price
Channels of retail distribution from full-priced store, factory outlet, internet and catalogs
High level of inventor
Products generally inaccessible to most consumer segments (BCDE)
Factory outlet stores outperforming full-priced store
Diluting brand with increased growth of factory outlet stores
Men's accessories only account for 2% of sales
Outerwear only accounting for 2% of sales
Luggage only accounting for 1% of sales
New store openings
Growing demand of luxury goods in emerging global markets, such as China and India
Increased wealth of consumers in global markets of Asia, Middle East, Australia, and Mexico
Slowdown in consumer spending
Fashion trend changes
French and Italian designer brands such as Gucci, Prada, Louis Vuitton, Dolce & Gabanna, and Ferragamo
Brand diffusion: Manufactures of the finest luxury goods launching diffusion lines to exploit middle-income consumers. For example, Dolce & Gabanna launching “D&G”, a sub brand sold at modest price points.
Counterfeiting of luxury merchandise, totaling $500 billion worth of goods sold in countries throughout the world in 2006.