Chapter 7 · Business Marketing

Coach, Inc.

516 West 34th Street 

New York , NY , 10001 

Website: www.coach.com

Phone: 212-594-1850

Industry: Retail - Apparel and Accessories

NAICS: Clothing Accessories Stores (44815)

Although Coach began as a manufacturer of small leather goods, the company now has independent manufacturers that it maintains control over "from design to manufacture." Since the company has product development offices in China, South Korea, and India that oversee the mentioned manufactures and raw material suppliers, Coach is able to implement a global manufacturing strategy that allows them to maintain control over materials used in products. 

According to Coach's COH 10-K, the company has manufacturers in China, Italy, the U.S., India, Thailand, Vietnam, Turkey, the Philippines, Ecuador, Malaysia, Mauritius, Peru, Spain and Taiwan.

Independent manufacturers and partners have to comply to Coach's high quality standards, so only the best can be used for Coach products. Coach has random inspections of their facilities to make sure that their partners, like those providing the finest leather, are complying with Coach's policies. 

Additionally, the fact that there are certain department stores that are authorized to sell Coach products is an example of business marketing. When Coach does business with, for example, Macy's or Bloomingdale's, those stores aren't interested in keeping the handbags or shoes for themselves but are more interested in selling them from their store. 

Department stores authorized to sell Coach products:

• Macy's
• Bloomingdale's
• Dillard's
• Lord and Taylor
• Nordstrom

Coach has always been a strong believer in business ethics and great customer service. The Chapter 3 blog post on Ethics and Social Responsibility describes the company's business ethics and describes Coach's Global Business Integrity Program more in depth, but in short, the company "seeks to be a good employer and a responsible and socially sensitive corporate citizen in the locations in which the corporation conducts business."

The company values honesty and integrity, and feels that it is responsible for delivering the best service to ensure that the needs of a customer are always met. While the company is intent on attracting new consumers, Coach continues keeping current customers satisfied.

Sources: Manufacturing, Company Profile

Chapter 8 · Segmenting and Targeting Markets

The words "target market" have been mentioned in various posts, and while Coach has continued to target men and [mostly] women between the ages of 16-54, the company has remained focused on expanding within Asia. Coach has directly operated locations throughout Asia, located in Japan, China, Korea, Taiwan, Malaysia, and Singapore. There are also locations within Europe: in the UK, Spain, Ireland, Portugal, Germany, and France.

As Coach continues striving towards establishing themselves as a lifestyle brand, they have been in a "transformational period" for about a year. When the period ends, around December 2013, the company can bet on becoming a force to be reckoned with. By transforming the company into a global lifestyle brand, Coach increased direct competition among lifestyle brands such as Michael Kors and Tory Burch, two fast growing companies, "both of which have nibbled away at Coach's still-dominant share of the North American handbag market."

In terms of Coach's geographical sales mix, 70% of sales are represented by North American customers. This includes sales through company-operated stores, online purchases, and wholesale distributors. International sales account for 30% of sales, through company-operated stores throughout Asia and from online sales.

Coach has been targeting consumers based on personality for years. When the Poppy Collection was introduced in 2009 to help sales during the recession, it focused on capturing the youthful spirit of the Coach woman. The line succeeded, and as the company grew, so did Poppy. The latest line is described as having a "downtown edge" and

 

East/West Satchel from the latest
Poppy Collection

"sophisticated new silhouettes with slender straps give the latest Poppy Collection a ladylike sense of refinement. They combine the luxury of Coach leathers with delicate yet iconic hardware and a fashion-forward palette."

When purchasing Coach products through their website, shoppers have the option to "connect with Coach". By signing up for Coach emails, customers are notified of new products that are available to purchase. Additionally, Coach sends out pamphlets to customers that offer 25% off for them and a friend, including two promo codes that can be entered at checkout online or scanned in store.

Shopping in store proves to be a different experience than shopping online, especially at Coach. The stores tend to be big, and can have more than one floor. Their flagship store is the most distinguished in terms of its design. The store was redesigned from a 2,600 square foot store to one more than double the size, and now stands proudly on the northeast corner of East 57th Street and Madison Avenue on 6,000 square feet of land. It has three stories, and offers more variety to choose from. Handbags,shoes, clothing, perfume, watches and other accessories grace each floor of the beautifully designed store that not only provides the latest designs of superb quality, but also has impeccable service. As of the company's 2013 fiscal year, Coach has 351 retail stores in North America, with total square footage of 952,422.

Coach has long been considered as an affordable luxury, appealing to middle class consumers. The company's simple, understated, and sophisticated design continues to attract new customers and those who have established brand loyalty have the pleasure of waiting for Coach's next design to wow them.


Sources: Coach's New Strategy: A Lifestyle Approach, Sale Stats, Coach Expansion