The business world was filled with “mazal tovs” on the announcement that Coach would buy the shoe company associated with Kate Middleton and red carpet A List celebrities, Stuart Weitzman. But this engagement might lead to some cold feet. Can Stuart Weitzman really save Coach from itself?
Coach’s brand had been in decline, and management blamed the fact that it might be too focused on handbags, that handbags had become less popular, and that Coach need to transition itself to becoming a full lifestyle brand including shoes and other accessories. Hence the acquisition of high-end shoe maker for the stars, Stuart Weitzman.
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However, it is possible that Coach is not correct about the reason for the sales slump. Perhaps it wasn’t because of the handbag specialty, but because, through the years, Coach handbags had become less special. Coach had become a more accessible brand, as explained by Millward Brown, but it had become too accessible. There were too many ways of finding a Coach bag cheap, and if there are promotions, why should anyone want to pay up for Coach? The brand became too preoccupied with price, when “price” should have been consigned to irrelevancy.
Millward Brown cites Milton Pedrazaof the Luxury Instituted, “The problem in luxury is that you don’t know when you’ve crossed the line until you have crossed the line.” It is possible that Coach crossed the line quite a while ago, and it isn’t so certain that its problems can be solved by the Stuart Weitzman acquisition.