Case Position Paper B - Coach Inc. - by Henrik Müller
1. External Environment
1.1 General Environment
1.1.1 Economic Environment:
As the case is from 2006 the company was probably facing some issues between 2007 and 2010. Luxury goods are usually one of the first market segments to decline in case of an Economic downturn / crisis. However, the fact that Coach Inc. is a lot cheaper and therefore have a broader customer base than most of their competitors, they are probably facing less financial problems than them and might therefore be able to keep or even further improve their current market share.
1.1.2 Global Environment
In recent years, the number of wealthy households, especially in Eastern Europe and Asia increases at a high pace.
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2. Internal Assessment
2.1 Resources and Capabilities
2.1.1 Quality
Clearly, quality is the most important capability of this company. Even thoug Coach Inc. offers prices as low as 50 % lower than those of direct competitors, they are still able to sell products with the same or even higher quality standards. Furthermore, they offer to refurbish or replace any broken handbag, no matter how old it is. I believe this is a unique selling proposition in this market and is a great way to enhance consumer trust and therefore retain customers. The survey winning (in 2006) customer service and shopping experience in their stores helps emphasize on that.
Quality is definitely their most important core competency. While other companies might design products that are more appealing to target customers, no one of them can offer the price/quality ratio that Coach Inc. offers to consumers. Therefore, Coach are able to create more valuable products than their competitors.
2.1.2 Human Resources
As the company was established in 1941, they are very experienced in this field. Also, they are one of very few American luxury brands, which can be a strength in the sense that some consumers who prefer American luxury goods, would rely on Coach Inc., since it is the most successful American based manufacturer. Furthermore the very successful company history is an indicator for the very experienced and skilled human resources the company has.
While I would not classify
Sports are a form of entertainment, whether it is playing them or watching them. Yet part of the entertainment is also the audience. The fans can have a large impact on the game itself as well as your experience.
Fast changes in environmental market place such as social development (globalization and development of social networks), economic unsteadiness (crises), technological progress, fast growing competitive world and strict marketing regulatory directly affect work of most of marketing companies or marketing and brand image divisions of the companies. I order to implement a successful campaign or increase sale and consumer awareness companies have to stay in pace with recent marketing environment and take into consideration every possible detail that might help or ruin image of a company or product.
I was wondering if you had time could you check out my highlights. I play defensive end and linebacker. I had to play many different positions last year due to the number of players on my team. I played other positions, like on the offensive line, which didn't stop me at all. On my film, there are clips of me blocking bigger defensive lineman off film.
Economic: Being a non-necessity, luxury brand, companies took a hit during the economic downturn. Between 2006 and 2010, poor economic conditions created a .6% decline in industry sales. When customers have less discretionary income to spend, they are less likely to spend money on luxury products.
As the company continues to evolve, it still stays true to its attractive qualities that have earned millions of loyal customers around the world. They have a commitment to quality. By only carrying 4000 stocked units in the warehouse, compared to 30,000 at your local super market, it can carefully choose its products. This insightful selection is based on quality, price, brand and features. Therefore, having the ability to offer the ultimate best value to its members.
The following case analysis will assess Coach Inc. and its strategy in the accessible luxury brand goods market. The coach strategy focuses on its luxury rivals in matching key quality styles while offering it at a cheaper price. The company offers most products at a 50% off discount price less than other brands which gives them a competitive advantage pertaining to its customer base. Coach marketed its products to middle –income consumers desiring taste of luxury, but also affluent and wealthy consumers with means to spend considerably more on a handbag (Gamble, 2012. P.C-73) .The Company also has several other strategies such as to increase global distribution, improve same store sales productivity and continue its multi-channel business model which includes indirect whole sales to third party retailers but also focuses on direct consumer sales. Coach has done well in the luxury goods industry but the companies profit margin is still below the levels achieved prior to the onset of a slowing economy in 2007 ( Gamble, 2012. P.C-73.The Company had experienced a decline in sales as they are unsure if the company recent growth could remain constant and maintain their competitive advantage with other successful luxury lines Michael Kors, Salvatore Ferragamo, Prada and Dolce & Gabbana.
Our company in terms of market share, is dominating every other company in the Private Label segment with the exception of Latin America. Our competencies or advantages in the internet segment are as follows: maintaining strong S/Q ratings, offering free shipping, and targeting our customers with advertising. In the wholesale segment, advertising and our S/Q ratings continue to be our competencies, moreover, we also utilize more retailer outlets. Our advertising strategy is to improve our visibility for our shoes, and it is our distinctive competence. In our wholesale segment, by maintaining strong advertising, we are supporting the retailer’s efforts to create brand awareness for our shoes. We use more retailer outlets which aid the advertising, as there is more exposure for our shoes. Our advertising expenditures across the board are higher than that of our competitors in both the internet and wholesale segments. Dream Athletic takes a cost leadership approach as its business strategy, which allows us to drive our costs down while maintaining our production of stylish and quality footwear. The S/Q rating is currently a core competence as our managers seek to increase the S/Q rating in years to come. The lowest S/Q rating in each region and segment is 4, and our highest S/Q rating across our segments and regions is 5. In the last year, we have increased our spending on TQM/sigma six programs to increase our plants efficiency. Our customers per our success in the industry, demand a stylish and quality shoe; therefore, we will continue to improve this core competence and turn it into a distinctive
Your post is very insightful and provides a great overview of the various components of a coach’s contract. As I begin to research the different facets of a coach’s contract, I came full-circle and wondered what is the difference between a coach and a tenured professor, other than the primary element of sport. A coach is an employee of an institution as is a tenured professor. Adopting the contract terms of a tenured professor could help de-escalate coach contracts and regulate the manner in which coaches seek employment as well as the manner in which they are sought.
Coaching is a two-way process, so being able to communicate with the coachee is a vital part of the coaching program. The coach should not be judgemental or try to impose or influence the coachee in any way. The communication from the coach needs be clear and precise at all times, so as not to cause any confusion.
Coach experienced declining revenues in 2014-2015 after sluggish brand value. The company abandoned the strategy of discounting after customer demand for promotional products deterred interests in paying full price. Coach made a marketing correction and removed discounting in an effort to increase product appeal. In May 2015, Coach acquired Stuart Weitzman, a leading designer and manufacturer of women 's luxury footwear. Similar to Coach, it is a brand built on offering innovation, relevance, and value to a loyal customer base, and is known for its craftsmanship and quality – merging fashion and function. Coach has a very limited number of men products which weakens the company’s
Their brand and how loyal their customers are is what they are known for. They have a very unique operating strategy where they offer premium choices made by the customers themselves. They eliminated the middleman of Fresh Direct and suppliers. They can provide high quality at lower costs which has positively affected the revenues.
Coach operates in a highly competitive industry with low market-entry barriers. While it is relatively easy for new companies to enter into this market, most shy away due to the lack of staying power and proper capital, as well as the know-how in total quality management. The long-standing brand equities associated with the existing players in this industry are a strong deterrent alone for any potential new entrants. In addition, there are large amounts of costs involved with the process of creating and maintaining a new company, which would also steer most potential new entrants away. If all other things being equal, Coach, along with its competitors, has greatly benefitted from these factors shielding them against the threat of entry
Almost 5 years after the DOJ and NY Attorney General joined forces to bring an antitrust suit against Coach USA Inc, and City Sights LLC, top executive Ralph Goren was sentenced to fifteen months in prison. Goren, former Vice president of technology pleaded guilty to concealing and destroying documents during the investigation of the alleged monopoly of the NYC hop-on hop off tour business.
Based on the complexity of Coach Inc. (Coach) inventory system and policy, I identified potential risks that could affect Coach’s productivity and carefully chosen critical extended procedures to detect possible fraud and misstatement.
Growth has been fueled by Coach’s niche as being ‘accessible luxury’. While Coach does not have the prices of most of its high-end competition, it is regarded throughout the industry, and most importantly by consumers, as being equal in quality to much more expensive brands.