Handbag superpowers Kors, Coach fight for crazed Macy’s shoppers

Mayhem at the Coach counter in Macy’s. Photographer: Jeenah Moon/Bloomberg

INTERNATIONAL – During the holiday shopping frenzy that grips America every year, the handbag wars descend upon midtown Manhattan with unbridled fury.
Specifically, the largest department store in the country: the Macy’s flagship. The behemoth opens its doors on Thanksgiving afternoon to thousands of shoppers, and the first thing they see are the bags. Employees on the front lines brace for impact as they shovel leather satchels, shoulder bags and clutches to the ravenous hordes.
Those bags belong to Coach and Michael Kors, two rivals who’ve been duking it out for years. They have dueling shops right inside the Macy’s main entrance. On Thursday and Black Friday, the raucous crowd streams in to their displays, unfazed by the predictable glare of news cameras. “Excuse me, we’ve got to make money!” a Coach associate says as he muscles his way through to replenish a rack of 50-percent-off crossbody bags. It was picked clean in minutes.
This year, expected to be a $1 trillion season, there’s more than usual at stake for these two companies. Handbags represent a $7 billion segment of the U.S. fashion accessories industry, but they’ve been on the decline, down 8 percent in 2017 over the year prior, according to data from research firm NPD Group. As Kors and Coach seek to make up the difference, the rivalry has spilled into other fashion categories. Each is trying to build a U.S. rival to European luxury conglomerates LVMH and Kering SA, which own dozens of high-end brands that make everything from sandals to yachts.
Coach acquired shoe label Stuart Weitzman for $574 million and former handbag rival Kate Spade for $2.4 billion. Kors responded with a $1.2 billion purchase of high-end footwear brand Jimmy Choo, then shook up the fashion industry with its $2.2 billion acquisition of Italian icon Gianni Versace SpA. Meanwhile, their namesake brands have broadened their offerings, with more ready-to-wear clothing and accessories, including watches and sunglasses.
Coach and Kors are even looking to tweak their branding to match the expansion. Last year, after adding Kate Spade, Coach renamed its corporate entity Tapestry Inc. Following the Versace announcement, Michael Kors said it would change its company name to Capri Holdings Ltd.
Upstairs at Macy’s, on its equally hysterical shoe floor, there are few handbags in sight. Here, Kors is surrounded by Coach, too. Kors has a gleaming white store full of chunky heels and peep-toe booties, but all three Coach brands are close by. The Kate Spade has a little space to hawk its slides and pumps. Stuart Weitzman is on the other side, with customers lining up to buy knee-high boots. And Coach’s namesake shoe shop looms over them all, its heels presented on shelves high in the air.
Both companies are struggling to return to their former glory, after years of intense competition led to heavy discounting and eroded their cachet. So far, each has recovered well, returning U.S. sales to positive growth. Both have undertaken a strategy to become a luxury house of brands, having refocused on selling more non-sale items, bringing average prices higher and weaning shoppers off of perpetual discounts.
Not today, however. On Black Friday at Macy’s, it’s about the mad grab for any and all shoppers, and there’s no shortage of markdowns. The Kors store is full of bright red signage declaring 50-percent-off “doorbuster” deals. Coach’s black signs promise either 30 or 50 percent-off merchandise. Within minutes, store workers are picking bags up off the floors and re-aligning those shoved aside by aggressive browsers. It’s full-on shopping debauchery, and it’s still November.
BLOOMBERG 

Source: iol.co.za