Coach Inc. has been one of the most well-known luxury fashion brands in the U.S. for more than four decades, but the company has given itself a facelift in a very unexpected way. Effective Oct. 31, 2017, Coach Inc. is changing its name to Tapestry.
The company’s new web site, tapestry.com, is already live. The Coach brand will live on as one of three brands under the Tapestry banner — alongside Stuart Weitzman and the recently acquired Kate Spade.
The rebranding may have as much to do with clarity as anything else. In an interview with Bloomberg, CEO Victor Luis noted that the name change was aimed at reducing confusion now that Coach, Stuart Weitzman and Kate Spade are under one corporate umbrella.
The move aligns with the company’s corporate reinvention, to elevate itself from a mid-market seller to a “fashion house” on par with European counterparts LVMH (parent company of Louis Vuitton, Christian Dior and Sephora), Kering (parent company of Gucci, Yves Saint Laurent and Puma) and Richemont.
Tapestry is deep in a rivalry with Michael Kors, which already has expressed ambitions to build a “luxury group” of its own, starting with the $1.2 billion acquisition of Jimmy Choo in July 2017.
Whether it’s called a “fashion house” or a “luxury group,” it’s clear that the major luxury brands feel they need to consolidate with compatible partners to reach a wider swath of consumers. At the same time, given luxury’s struggles entering 2017, these brands don’t want to make themselves too available to the average consumer. Both Coach and Michael Kors have pulled back their department store presence amid slumping sales and the deep discounts often attached to their products.
The good news for Tapestry going forward is that the luxury industry appears to be improving. While Bain & Co. initially projected the worldwide luxury market would grow only 1% to 2% in 2017, the company adjusted its projections and now expects growth of 3% to 4% percent per year through 2020. To ride this growth wave, Bain & Co. encourages luxury brands to adapt a “Millennial state of mind” by:
Building story-living through inspirational conversations and experiences;
Upgrading personalization of product, service and message; and
Developing 1:1 relationships to nurture local customers.