Coach Inc Case Preparation Essay

Coach Inc. Case PreparationKey FactsLow cost provider strategyFocused on unified key opulence rivals in quality and styling while beating them on price by 50 percent or more combative reward Multichannel distribution model (indirect wholesales to third-party retailors vs. direct-to-consumer sales. Priorities increase global distribution and improve same-store sales productivity Build food market share in NA, JapanRaise grade awareness and build share in underpenetrated markets Increase sales of products targeted towards menCreate an online marketing presence using coach.com, etc4.2 billion in sales in 2011 (20 percent annual increase)63 percent were handbags, 27 percent accessories, 10 percent other products 16.7 million to 880 million in net income2012 direct-to-consumer accounted for 87% of 2011s net sales, indirect wholesaler had net sales of 540 millionCoach, Inc. in 2012 Its strategy in the well-disposed luxury goods market1. Describe the macro purlieu of the luxury good s labor. Political Factors The market in China was restricted for some time by the Chinese government Economic Conditions the economic downturn in 2007-2009 hurt the luxury goods industry Sociocultural Forces healthy/green movement, more conservative with money after the downturn etc Technological Factors more ways to maunder to consumers, provide brand awareness, and allow consumers to buy (websites, mobile apps, etc.) Environmental Factors weather not really a concern in the luxury goods industry reasoned/Regulatory Conditions none mentioned in the case really, other than the counterfeit laws which are in place to help the luxury goods industry2. What are the defining characteristics of the industry? What is the industry like? Defining characteristics of the industry/what is the industry like includes many competitors, growing demand as middle class and upper class expand, transformation in luxury products (using your brand name andattaching it to other products/lines i.e., me ns products for coach).3. How is the market for luxury handbags and leather accessories changing? What are the underlying drivers of swop, and how can these forces miscellany the industry? The market doesnt seem to be changing very much, maybe expanding as more money and other countries are becoming wealthier (India). Drivers of change are new internet capabilities and applications, product and marketing innovation, changing societal concerns, attitudes, and lifestyles Different wants handbags for the more on the go lifestyle, environmentally friendly bags/processes.4. What key factors steady down the success of makers of fine handbags and leather accessories? KFSs are diverse products, ahead of trends (fashion), marketing research, lower price point than contention, brand loyalty/recognition/awareness5. What is competition like in the industry? Which of the five competitive forces is the strongest? Which is the weakest? What is the industrys potential for profitability?Many comp etitors in the luxury goods industry.Strongest of the five forces I trust is rivalry, competitive pressures come from other firms in the industry, competitors numerous equal size and competitive strength, face high exit barriers, diverse countries of origin Weakest of the five forces I believe is potential new entrants, because brand recognition is so important in the industry Industrys potential for profitability is high, markets are grown and expanding, their sales are already high etc.6. What does your strategic group map of the industry look like? The three main categories haute-couture, traditional luxury and accessible luxury The first two are not where Coach competes but where some of its competitors are, where they have created other product lines that compete in the accessible luxury category. DKYNY, Calvin Klein, Louis Vuitton, (last two created diffusion lines) are competition in the accessible luxury category7. What recommendations would you make to Lew Frankfort to im prove the companys competitive position in the industry and its market performance? Follow their current plans and strategies to open up and pursue growing markets to improve market performance, and increased market share will help their competitive position.