Managing Luxury Brand Perceptions in a Global Market

Business Issue

By taking an “affordable luxury” position, Coach built Japan into its second largest market outside the US. More recently, however, this phenomenal growth of the Coach brand in Japan was beginning to slow. The company recognized that Japanese consumers were changing. Also, less expensive upstart brands were becoming real threats by using non-traditional channels and were cutting into the more traditional luxury brands, like Coach.

Coach wanted to understand the drivers behind the changes in the Japanese luxury handbag market, and identify a new brand strategy to reinvigorate growth.

Objectives
  • Understand the social, psychological and economic drivers behind changes in the Japanese luxury market in general and the handbag market in particular
  • Determine how key segments differ in their perceptions of luxury/fashion
  • Identify current perceptions of the Coach brand and key competitors
  • Identify the gaps between perceptions of Coach and the needs and wants of key segments
  • Assess how market “influencers” perceive the market, how they think it differs from the past, how it is changing, and what Coach needs to do to remain relevant to emerging luxury consumers
Services Deployed
  • Internal interviews with cross-section of Coach executives to determine current marketing tactics and brand aspirations
  • In-depth research in Japan with pairs of friends representing different segments of luxury handbag consumers
  • Interviews in Japan among key fashion industry opinion leaders (e.g., fashion magazine editors)
  • Brand focus workshop with Coach executives to review findings and discuss strategic direction for reinvigorating growth in Japan
Results

While results are confidential, Six Degrees uncovered new key insights about Coach and its competitors, societal trends, the mindset of various market segments toward luxury goods, and perceptions of luxury fashion by market segment. The recommendations provided (based on the research) heavily influenced new product and brand strategies currently being implemented in the Japanese marketplace.