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NEW YORK — Coach Inc. is returning to its roots in order to glimpse its future.

This story first appeared in the March 19, 2012 issue of WWD. Subscribe Today.

The accessories maker will unveil a new dual-gender collection inspired by its heritage that will become the cornerstone of its business as well as impact every other aspect of the brand, from increased price points to marketing, packaging and in-store merchandising strategies.

The Legacy Collection is a 360-degree lifestyle concept that includes an expansive selection of classic handbags with modern touches, vibrant small leather goods, funky shoes, hats, jewelry, eyewear and outerwear for fall and winter.

Legacy will hit all Coach stores worldwide as well as its wholesale partners on Aug. 1. Coach stresses the collection is not only a vehicle to attract a more fashion-forward clientele, but also to solidify its status as a lifestyle brand.

“This is a big deal, it’s a very big deal,” said Coach chairman and chief executive officer Lew Frankfort, who called the collection “an inflection point” for the brand.

“When we use the term ‘inflection,’ some of us mean ‘disruptive innovation,’ some of us mean ‘acceleration in business,’ some of us mean a ‘departure,’ ” he said. “Using business terms, I’d say it’s disruptive innovation. We’re hopeful that consumers will be surprised and delighted, that it will be very unexpected from Coach.”

The brightly colored leather-centric collection marks the 71-year-old brand’s first dual-gender approach with looks that nod to its most iconic handbag silhouettes, such as the duffle sac that was released in 1973. Although the bags may be inspired by Coach’s vast archive, they differ from their predecessors in shape, scale and weight, not to mention color, texture and finish.

“Historically, Coach in the old days was more somber and more straightforward,” said brand president and executive creative director Reed Krakoff, who strolled through Coach’s showroom, pointing to meticulously organized tables stocked with Legacy wares.

“We really tried to look and embrace the core of what we’re about and modernize it. We wanted it to feel relevant and of this time even if they are rooted in our history, so the coloration and fabrication are quite feminine, graphic and much more broad based,” he said.

Incorporating leather, suede, wool and faux fur, these lighter, brighter bags not only come lined with interior pockets, but also carry a heftier price tag. Small women’s purses retail for $178, with larger tassel totes retailing for $798. The iconic new duffle will start at $348 and go up to over $1,000, depending on size and materials used. Exotic skins, such as pony hair, can drive the price up considerably.

Men’s bags range from $398 for a courier style to $1,200 for a briefcase. While the arrival of Legacy will skew the brand’s price positioning somewhat — currently the bulk of Coach bags are $299 — the higher price of the line doesn’t mark an entirely new chapter for the brand.

Prior to the 2008 economic downturn, the bulk of Coach bags were actually priced at more than $300. After experiencing price resistance from consumers during the recession, Coach decided to broaden its mix, offering about half of its bags for less than $300.

With the addition of Legacy, Coach will be able to readjust the mix, but questions remain as to how the consumer will react.

“We’re distorting toward Legacy to have a stronger impact, but this is not a repositioning,” Frankfort said. “We’re going to continue to have a range of bags in the more compelling price-point tiers, including key styles within Legacy at the $250 to the $299 range.”

While the ceo said that the price-sensitive consumer would still have a wide range of choices, he also noted that only about 35 percent of Coach North American retail store consumers are price sensitive. The other 65 percent are “much more willing to spend more than they contemplated if indeed a bag catches their attention,” he offered.

One way Coach will catch its customer’s eye is with a new store layout. Come summer, expect to see large wall displays in Coach shop windows, which mix and match colorful new bags with jackets, vests and other Legacy looks.

Inside the stores, Coach will install carefully curated tables that showcase archival bags next to their updated cousins, along with small informational signs that will explain the history of the product.

Tables will also display the brand’s new extensive collection of Legacy small leather goods, ranging from wristlets, hangtags and tassel key chains to wallets, pencil cases and leather wrap bracelets.

In general, small leather goods in the legacy line will retail from $38 to $498. Outerwear for women will cost between $348 and $698, and for men, it will be between $448 and $2,400. Women’s shoes will cost between $128 and $548. Prices for men’s footwear were not immediately available.

While a large portion of the collection is devoted to women, there is also an expanded men’s offering that includes distressed boots, leather sneakers, square and rectangular leather messenger bags of various sizes, wallets and other leather goods.

For Coach, the importance of its men’s business is paramount to its growth. With $4.16 billion in sales for the fiscal year ended July 2, Coach’s men’s business is roughly 5 percent of sales, or $208 million. In the coming years, the brand is looking to double that with the help of continued robust international expansion. Coach operates more than 500 doors in North America, 178 in Japan and 80 in China, and it has more than 200 international locations operated by distributors.

At the same time, Coach must keep its women’s collection fresh, in order to maintain growth. Over the past few years, the retailer has grown at about 15 percent a year, Frankfort said, adding that in order to “maintain that level of growth, Legacy is a key driver.”

“Consumers need to look beyond product for visual stimuli to help ground their perceptions,” he said, underscoring how important the retail presentation is to the brand’s positioning.

While Legacy has been in the works for 18 months, Krakoff said that some of the impetus behind the collection was the feedback the brand was getting from limited edition, classic handbags it recently produced. Additionally, Coach had been noticing younger, stylish customers snapping up some of its vintage-inspired bags, and it saw an opportunity.

With a heritage steeped in quality leather goods, Coach “embraced the luxury of its materials,” developing leathers inspired from its past, Krakoff added.

“Everything was inspired by something that was preexisting or an outgrowth of something,” he said. “One of the core goals for this year is to really establish what we’ve been doing in a holistic way.”

Newer items like candy-colored rain boots with a rubber heel and chocolate brown suede trench coats may not be heritage items, but they, too, fit into the overall concept behind Legacy.

“For me it’s always a good time to be excited, to try to make the brand new and to keep it exciting and relevant but always in terms of who we are,” Krakoff said. “I think the most important thing is that people are extremely well educated about what they do and don’t want, and really the only way to compete today is to have a strong, recognizable position. For us, this is by far the most iconic, recognizable collection.”


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