Business: Luxury Good and Competitive Advantage

Topics: Luxury good, Strategic management, Retailing Pages: 3 (1562 words) Published: October 23, 2014

Maloree Johnson
Business Strategy
September 22, 2014
Coach Case Study
5. What is Coach’s strategy to compete in the ladies handbag and leather accessories industry? Has the company’s competitive strategy yielded a sustainable competitive advantage? If so, has that advantage translated into superior financial and market performance? A business strategy refers to the means by which it sets out to achieve its desired objectives and goals. Coach’s competitive strategy deals exclusively with management’s game plan for competing successfully and securing a competitive advantage over rivals Michael Kors, Salvatore Ferragamo, Prada, Giorgio Armani, Dolce & Gabbana, and Versace. The different types of strategies used by these companies include, but are not limited to, low-cost provider strategies, differentiation strategies, focused low-cost and differentiation strategies, and best-cost provider strategies. Coach Inc.’s strategy that created the accessible luxury market in ladies handbags made it among the best-known luxury brands in North America and Asia and had allowed its sales to grow at an annual rate of 20 percent between 2000 and 2011, reaching $4.2 billion. The company’s strategy focuses on five key initiatives. First, Coach built a market share in North America by 15 new full-price retail stores and 25 factory outlets. They have built a market share in Japan through the addition of 15 new locations. Coach seeks to raise brand awareness and build share in underpenetrated markets, including Europe and South America, and Asia, with 30 new locations planned in the region. It also looks to increase sales of products targeted towards men by offering dual gender lines. Lastly, Coach raised brand awareness and built market share through coach.com, global e-commerce sites, and social networking initiatives. Coach Inc. implements various advertising strategies, marketing strategies, sourcing strategies, and differentiation strategies, etc. Coach’s...
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