Wrong Prescription for Coach’s Ills

Coach continues its downward slide. Sales in 3rd quarter 2015, dropped 15%. Some blame currency issues and the over-proliferation of outlet stores. Note to leadership, it’s the merchandise. Stuart Vevers strategy is stodgy, European and not much fun. The sleepy handbags are more matron than Millennial. Note to pundits, Millennials love outlet shopping. I still contend that their turnaround strategy is seriously flawed and too dependent on overly competitive apparel. I wrote this post in 2014 and not much has changed except Michael Kors and Kate Spade are hitting some headwinds, as well.

Coach’s 2014 first quarter profit fell 20%, while aspirational fashion rivals such as Michael Kors and Kate Spade continue to ratchet impressive gains. Coach experienced a steep drop in North American accessories sales. Coach’s strategy for slumping sales is a planned full lifestyle assortment, to include apparel and a greater emphasis on higher priced bags over $400, the volume sweet spot.  They recently hired a new creative director Stuart Vevers, to take over for Reed Krakoff (who is resigning); his first product introductions will be in Fall 2014.

Coach spring 2014 styles

Coach spring 2014 styles

As a Coach watcher and stock holder, this strategy goes down like bad medicine. Instead of aiming to win in the sweet spot, they are abdicating to the competition. Michael Kors’ apparel is a footnote to his successful handbags, watches and shoes. Kate Spade offers some of the most whimsical, colorful, bags, shoes and accessories and apparel is secondary. Tory Burch is a shoe and bag story with apparel paling in comparison.

Accessories are the democratic categories in which women of all ages and sizes can play, women’s apparel is stuck in a highly competitive funk.

Coach was riding high, in the early 2000’s. Their then colorful, fresh, “C” logoed bags were the “it” bags for the aspirational designer masses. Over time, they became ubiquitous, as every hairdresser and soccer mom carried them. As they down-trended, they didn’t follow with renewed  innovation, instead made the critical mistake of looking back and doing a rehash of the sturdy, vintage Legacy styles. These unrefined bags, although colorful, looked like a clunky 1980’s LeBaron instead of a chic 2013 Audi. The competition was forging ahead with exciting materials, color and patterns, like Michael Kors’ glam styles, Kate Spade’s playful totes and tech cases, the silicone Furla Candy bag and styles by Rebecca Minkoff, Marc Jacobs, Ted Baker and Longchamp.

The current assortment is sleepy at best. It feels like a lightly-veiled nod to Salvatore Ferragamo. They played it safe and sexless. There is no emotional must-have draw. Even with 25% off coupons, one is hard pressed to spend the deal. The prospect of a larger selection in the $600 plus range is a miscalculation of opportunity. They need to focus on modern, forward  materials, shapes and details in the $400 range sweet spot; then offer additional showstoppers in the $600 plus range.

Coach went too safe.

Coach went too safe.

A  key asset for Coach is their well-priced, quality shoe line. They offer slightly more wearable shoe heights than Kors and at prices lower than Kate Spade. I hope they don’t think they need to raise prices and heel heights to get a new customer. Maintain the $198 average price point and expand the selection to include more options of fashion-forward sandals, pumps, wedges, loafers and boots.

This great American brand has had a small stumble. When you take fashion risks as good brands do, you will trip-up sometimes. This brand has a cold, but certainly isn’t terminal. They just need the right prescription for renewed health.

Dix&Pond is the blog of Dix & Pond Consulting Creative and strategic consulting for retail, wholesale apparel, footwear, consumer products and branding agencies. Follow me to get the latest posts

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Great New Color Trend Service

Are you a little bored with the same old color trend services year after year? Any design director who has been in the business for while starts to recognize the color service without seeing the label. A bigger problem is that many pricey forecasts come out about 18 months in advance. How can they be right? Fashion designers should strive to work closer to season.

Introducing a new women’s color trend service called COLORSCOOP. What sets it apart, is it comes out closer to the season (about 12 months in advance) and is chock full of beautiful, current images to support the forecast. This exciting service comes as a wired-bound book, with Pantone textile references and understandable commentary. Created by a design director for design directors and an economical $295 per season.

A page from spring 2015 Colorscoop.

A page from spring 2015 Colorscoop.

Dix&Pond is the blog of Dix & Pond Consulting Creative and strategic consulting for retail, wholesale apparel, footwear, consumer products and branding agencies. Follow me to get the latest posts

Spring 2015 Fashion – Green Energy

Green the color of optimism, growth, renewal and happiness. Couldn’t we all use some of that right now?

Bountiful greens are the biggest trend for spring 2015 fashion. Expect the unexpected, you will see them everywhere including sportswear, handbags, lingerie, active wear, swim, footwear , accessories, jewelry and in beauty. These exuberant greens range from the palest mint, jade, spearmint to deep dark forest. They cast slightly blue. Green can be a tad retro, bohemian or classic. This is the most sustainable form of green energy. Check out COLORSCOOP, the best new women’s color trend forecast!

Fresh greens are the big news for spring 2015!

Fresh greens are the big news for spring 2015!

Dix&Pond is the blog of Dix & Pond Consulting Creative and strategic consulting for retail, wholesale apparel,  footwear, consumer products and branding agencies. Follow me to get the latest posts

Fashion Activewear Wins the Gold

Let’s face it, there is too much apparel offered for the North American market to absorb. Strong evidence is that most price points of casual apparel, haven’t risen in decades. Part of the deflation was the elimination of quotas. The main reason is when there is an over-supply of something, it loses pricing power.  40-60% off anyone?Fashion Activewear

Another factor is a lack of excitement in casual fashion. Year after year, we see endless commodity tees, jeans and shorts,  Big yawn.

There is a bright spot. Athletic wear, active wear, performance apparel, whatever you call it, is dominating casual fashion. These industry terms are nothing more than comfortable casual clothes, in unique fabrics that flatter the body, while taking a beating. Appearing active provides an “in” to the hip club of people who care about their bodies and wellness; even if most people will never do yoga or run a marathon.There has been fashion “risk taking” in silhouettes and fabrics in the active category. Lululemon even with their recent pant and PR foibles has dominated by offering compelling fashion in a range of technical fabrics.  They broke all the dreary rules of developing safe, cheap active apparel. Dense and constructed fabrics smooth flaws and support the body.  High prices are part of the status appeal. The offer continuous newness. Rule breakers often find opportunity in the road-less-traveled.

Who cares if clothes are anti-stink, moisture wicking or breathable, if you aren’t wearing them to exercise? They have supernatural powers to make the wearer feel sexier, current and part of the aspirational “it” club. Fashion is about emotion after all. Under Armour, the other dominant brand, born from apparel roots, understands they are selling “power” not poly. (Under Armour’s 2013’s revenue grew 27.1%) Companies with a strong “brand promise” have pricing power.

Smartly, Nike understands the trend and stepped up their apparel game compared to most footwear companies. Nike announced that its branded apparel has grown by 40% in the last 3 years!  This isn’t true for most footwear brands, creating humdrum clothing, as an afterthought. There is a mushrooming market for fashion-driven active brands like Michi, Prism Sport, Koral and Stella MCartney for Adidas. You can see others on the newly launched, active fashion ecommerce site, Carbon 38.  

Dix&Pond is the blog of Dix & Pond Consulting Creative and strategic consulting for retail, wholesale apparel,  footwear, consumer products and branding agencies. Follow me to get the latest posts

Hot Shoe Trend-It’s Good To Be Bad

“When I’m good, I’m very good, but when I’m bad, I’m better,” so goes the famous quote from May West.

A red-hot holiday 2013 shoe trend is take-no-prisoners, bad-girl shoes. This badass footwear includes moto and over the knee boots , ultra pointy flats and towering pumps decorated with metal studs. Live dangerously and watch them fall into line. Men will swoon. These power shoes mean business, I’m talking monkey business!

It's good to be bad. Badass shoes are red-hot for 2013!

It’s good to be bad. Badass shoes are red-hot for 2013!

Some of the best are from Frye, Michael Kors, Stuart Weitzman, Valentino, Christian Louboutin, Sam Edelman, Burberry, etc. Wear with caution as these shoes could get you arrested for disturbing the peace!

Dix&Pond is the blog of Dix & Pond Consulting Creative and strategic consulting for retail, wholesale apparel,  footwear, consumer products and branding agencies. Follow me to get the latest posts

Fall 2013 Casual Shoe Fashion Trends

French Dressing – Summer 2013

We live in a global market of micro fashion trends. Apparel brands create their own reality to serve their fans. There are few really big trends that are so salable, so wearable, that they bubble up all over the market simultaneously. A tad nautical, combined with a pinch of early sixties ingénue, French Dressing is summer 2013’s most enchanting big fashion trend.

French Dressing is reminiscent of the endlessly chic style of French women, who are masters of remixing classics in fresh combinations. The contrast of gender-neutral graphic stripes and dots with full-blown feminine styling, delivers an irresistible knock out punch. The combination of sport and sweet is modern and ageless.

French Dressing is summer 2013's most chic and wearable trend.

French Dressing is summer 2013’s most chic and wearable trend.

The colors are summer’s most versatile neutrals, deep navy and pure white, sprinkled with a touch of bloody Mary and periwinkle blue.

Dresses are especially important including fit and flares, halters and shifts. There are both 60’s structured woven dresses and simple knit sheaths. Bottoms include white denim, boyfriend jeans and shorts, printed and lace shorts, pencil, short-flared and 5-pocket skirts. Tops include boat, cowl and crew necklines. Retro looking swimwear includes flattering under-wire bikinis and 50’s style one-pieces. Fabrications are very casual, such as twill/spandex, seersucker, cotton and linen knits.

The footwear is casual, with platform, tie and flat espadrilles, smoking slippers, pointy-toe flats and vulcanized sneakers. Slouchy straw totes, retro and aviator sunglasses complete the look.

Parlez-vous Français?

Dix&Pond is the blog of www.dixandpond.com Creative and strategic consulting for retail, wholesale apparel,  footwear, consumer products and branding agencies. Follow me to get the latest posts

Fashion Faux Pas-Stereotyping Older Consumers

For decades fashion retailers rode the Baby Boomer purchasing wave as they started, advanced and continue their careers. They were the first generation of educated women who fully intended to join the professional ranks, often putting off child-rearing to later in life or never at all. Consequently, they are the most-travelled, wealthiest and most independent women ever in the westernized world.  Retailers are always looking for unmet consumer demand and opportunities.  This large demographic still offers opportunity for companies that don’t fall in the trap of underestimating her, by addressing her with one broad brush.

There is unmet demand for age-appropriate, forward fashion for a 45+ contemporary customer.

There is unmet demand for age-appropriate, forward fashion for a 45+ contemporary customer.

This is the misconception. As all women age, they no longer want to show their figure and take fashion risks. They want cheaper quality and want to disappear into a decorative tunic. I won’t name names, but you all know the colorful, “soft” retailers that subscribe to a stereotypical formula and have hit a ceiling in an aging market. The customer for this type of merchandise is already well-served.

How could brands that target an older customer fail with a burgeoning aging female population? There are many lifestyle and niche markets in men and women of all ages from extremely conservative to fashion-obsessives. It is critical to understand the lifestyle and persona of the target audience and have realistic expectations of the demand.

Many 45+women still have great bodies, a sophisticated fashion sense and plenty of disposable income. They care about their appearance. Many customers don’t want to identify as old and reject the brands that imply it. The designers and retailers who subscribe to a one-size fits all image of this age group are having their matronly hat handed to them.

I know many stylish women in their 40-80’s, that won’t set foot in the well-known specialty stores and sites that target a “so-called” aging consumer with their floaty tops and frumpy pants. In fact, the softer the body, the more flattering structure becomes in a garment. Companies need to consider their specific target woman, values, taste, income and needs.

Of course, people’s bodies change as they age. All apparel companies in any category, have to target an age/body type for their consumer. They have to develop a standard fit, but not necessarily safe product to go with it. In some sense, the notion of a larger fit only for an aging population is becoming debatable, because of rising obesity rates in younger people raised on whipped caramel lattes.

There are fashion-forward contemporary brands such as Theory, Vince, Lululemon, Diane Von Furstenburg, AG, Joie to name a few, who are enjoying great success because they work for a wide range of body types that relate to their brand. Unfortunately the list is short. There is also a male boomer who wants stylish age appropriate contemporary merchandise. Brands like Hugo Boss, Theory, John Varvatos, Robert Graham, AG and Michael Kors are appealing to this ageless male contemporary customer. I believe the men’s business is experiencing robust sales because young men are adopting more dressed up looks for an edge in the job market, the major trend toward slimmer silhouettes and the 45+ customer who is fit, has money and doesn’t want to look old.

Fashion foward shoes & bags have been stand out sellers for all ages. (Valentino Rockstud Ballet Flat)

Fashion foward shoes & bags have been stand out sellers for all ages. (Valentino Rockstud Ballet Flat)

Why have shoes, bags, accessory and beauty products been the standouts categories for years? Partly because these are the democratic categories, in which all women can participate. There is a redundant oversupply of apparel in the market. Opportunity lies in forward, casual, flattering merchandise that accommodates an aging body. It may be a tad longer, less clingy and revealing, but maintain a serious sense of style, quality and sophistication. Simplicity is always in good taste. What is age-appropriate? Appropriateness, more than anything, is a flattering fit.

Some other posts you might enjoy:

Tough Retail: 7 Ways to Grow Your Consumer Brand

Why Fashion Brands Fail to Thrive

 

The Dix & Pond Blog, by Stephanie Bernier is the blog of  Dix & Pond Consulting, a Boston-based, company that consults on business strategy, trends, creative direction, brand experience, product development and merchandising. Clients include retailers, apparel, footwear & consumer companies.  CONTACT US TODAY! 

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Coach – Stellar to Stumble

On the short-list of first-class American fashion brands, Coach certainly makes the top ten. The nature of market leaders is their willingness to take chances. No one becomes an Olympic skater holding the rail.

Coach fourth quarter 2012 North American sales were down 2% over last year, which sent the stock tumbling this week, in spite of increased international sales. North America accounts for two-thirds of the company’s business.

I have great respect for the aspirational luxury bag and accessory seller. They have turned a 72-year-old leathery dowager into a fashion powerhouse with their risk taking market leadership. There are far too many lackluster brands, that stand for nothing. I give them credit for ground breaking newness and willingness to take bold moves.

As an avid Coach watcher, the answer for the poor results is obvious. For many successful years, they addicted their logo-adoring masses to fresh shapes and colors of their iconic fabric “C” patterns. These signature looks fulfilled the fantasies of mainstream wanna-be social climbers. Unfortunately, the patterned bags have become, all too common on the arms of every stroller pusher and tweeny bopper in the mall.

Fall 2012 Coach Legacy bags

Fall 2012 Coach Legacy bags

They saw this coming. In second half of 2012, they took a radical step and introduced the Legacy collection. I never warmed up to this collection of vintage leather Coach styles in bold colors. They bet the ranch on Legacy and it dominated the second half assortment. I awaited its pending arrival and wanted to love it. Somehow, it didn’t feel modern, and the traditional leathers seemed a bit dowdy in a digital world. Perhaps it is the sea of wristlets and cross-body bags, aimed at an over-indulged teen? It doesn’t have the freshness of their more innovative styling. The only thing it had going for it was color. I give them an A+ for trying. This is the fashion business and leaders sometimes stumble.

CEO, Lew Frankfort is blaming the lack of demand on “competition.” Some say Michael Kors is taking a bigger share. I think the iconic Kors bags with the MK charm, are getting a tad stale, too. Kors does a larger shoe collection and dominates in uber-hot fashion watches. Kors stores have a consistent mix of accessories, apparel and shoes and isn’t reaching for an entry-level teen. I think Marc Jacobs, Kate Spade, Tory Burch and others are sucking the aspirational luxury winds in bags.

Coach won’t stay on the rails for long. This champion will bounce back. In bags, I think they need to explore more luxe leathers, modern materials like colorful patent leather and even silicone, as well as bold new shapes. They are talking about relaunching their shoe collection. I think their shoes offer tremendous value in terms of fashion quality to price. Expanding fashion jewelry and watches is an opportunity as well. Stay tuned. See Coach.com

Fall 2012 Coach loafers - A modern twist on a classic

Fall 2012 Coach loafers – A modern twist on a classic

Dix&Pond is the blog of www.dixandpond.com Creative and strategic consulting for retail and wholesale apparel, shoe and consumer product companies. Follow me to get the latest posts

6 Reasons Fashion Brands Fail to Thrive

Many apparel, shoe or accessory brands fail to grow, thrive or evolve over time. Fashion is discretionary. Clothing, footwear,  jewelry, handbags and accessories are emotionally driven purchases. Brands are much more than products, they are a total experience.

Consumers must identify with the implied promise of the brand to become loyal customers. Here is a slide show of the 6 main reasons that fashion brands fail to thrive and some of the stellar brands that are knocking it out of the park:

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