Coach's lifestyle branding strategy
New York-based Coach Inc.'s lifestyle strategy, outfitting the customer from head-to-toe, continues to unfold this year. Apparel will continue to be released with larger assortments through the fall season into holiday. Having re-launched shoes in 170 stores in March, which is a slower growth category in the market compared with handbags, Coach's decision comes with many opportunities and obstacles inherent in creating a lifestyle brand.
“Traditional branding has gotten organizations to a certain place in consumers’ minds, and lifestyle [branding allows them] to take it a bit further in delineating their uniqueness”
The expansion into new products and services, which the consumer is already buying elsewhere, can result in a larger share of the customer's wallet.
Lifestyle branding creates a high level of emotional value with consumers, especially when compared with brands based in value-cost propositions. Customers look to spend with brands that share their values. For example, Hugo boss exudes achievement and professional success, and Puma is the expression of active, healthy living. A brand serving their customer with an array of products to suit their lifestyle often creates a stronger sense of loyalty.
However, lifestyle branding poses many challenges, including acceptance in new markets. Alexander Cherney, Associate Professor of Marketing at the Kellogg School of Business stated: "By switching to lifestyle positioning, brands might be trading the traditional in-category competition for even fiercer cross-category competition. Now they have to compete not only with their direct rivals but also with brands from unrelated categories."
In many cases, higher costs associated with lifestyle branding may also be prohibitive to the strategy's success. The failure to create a significant lifestyle brand may dilute the brand’s value overall. Are the risks too high for Coach?
ADDITIONAL:
Change is the only constant in the retail industry, and changing strategies can have significant affects on sales, profit, supplier and store partners, and customers. Learn more about the connections between strategy shifts and the business - subscribe today to one of our retail courses and workshops.
Enjoy!