Month: October 2017

 A crucial story currently in the media is the liquidation of Sears. One of the reasons that this event is so widely discussed is due to the fact that it is a clear representation of a shift in the way that we shop as a whole. Sears was founded 131 years ago, and up until recent years it has been a huge part of the way people shopped. I remember my mom taking me there as a child, because it had just about everything we needed in one spot. Now, you can find everything you need from your living room without getting off the couch, through e-commerce. In an article I read on the Vancouver Sun I learned that the CEO of the Hudson’s Bay Company, another department store, has recently left the company. This is making investors uncomfortable, by foreshadowing a future similar to Sears.

One point of difference that The Bay does have going for them, is that it markets to a slightly different niche than Sears did. They do still fit the department store description yet they tend to sell higher end clothes and accessories. Brands like Polo Ralph Lauren, Levi, Calvin Klein and Guess bring a higher price point and attract a customer base with more income. As a society we do still need brick a mortar companies as there are still people who don’t trust online shopping or are looking for a personal aspect. Customers like to talk to employees and receive help and recommendations when shopping. Along with this people also want to physically touch and try on the clothing that they are buying. Although we are not ready to become completely online, we are leaning much closer in that direction than ever before.

If The Bay wants to avoid becoming the next Sears, they are going to have to play to their points of difference by increasing the high-end brands to cater to an older and financially stable market. Since most online shopping is done by millennials who tend to have a lower income it decreases the e-commerce competition.

 

 

 

I remember being a little girl and being in complete awe of the Coach store window. The Coach brand oozed class and status with its leather handcrafted bags and classic timeless designs. Back in the early 2000s, coach was dominating the accessory industry. However, by 2013 you could walk into just about any thrift shop and find an array of Coach purses for pennies compared to their selling price. The downfall of a business usually stems from poor management, which has been noticed by the company and kick started a company reset.

One of the main issues that the company noticed was that they tried to expand too hard too fast. In the mid 2000s they changed from their classic designs and tried to branch out into multiple colours and fabrics. This decreased the quality of the bags and gave an almost tacky look. Andre Cohen, one of the presidents of the company states that the bran became “a bit overexposed” and “a bit too heavily distributed” in the last few years. Coach’s value proposition has always been to market to woman of status, reflected by their high prices and attention to detail. By this decline in sophistication, it depletes their points of difference and makes it harder for them to stand out in the consumers mind in a sea of accessory brands.

The brand reset began in mid 2014 when they hired new creative director Stuart Vevers, who has also worked for Givenchy, Mulberry and Louis Vuitton. This gave the company a blank slate for creativity and new leadership to change the old habits of operation. As a part of this brand reset they are renaming themselves “Tapestry”, and they have recently purchased both Kate Spade, and Stuart Weitzman. This creates a versatile brand that markets to a far larger range of consumer segments. Coach has always branded itself towards mature middle-aged woman, while Kate Spade sells handbags and wallets to a younger target audience. Combined with the Stuart Weitzman brand selling shoes they are becoming the triple threat.

In our readings for week 8 we learned about the positioning and the power of a name. I think by renaming the brand ‘Tapestry’ they are giving themselves a true fresh start and leaning away from any negative connotations or preconceived notions that the consumer may already have about Coach. The acquisition of Kate Spade and Stuart Weitzman is also a step in the right direction as they are now able to sell their product to majority of age groups of woman in the higher-class sector. I also believe that coach can continue to grow as a company under this new leadership, sometimes all a weak team needs is a new “coach”.

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