Coach is getting killed as women abandon a classic wardrobe staple

Coach has a branding problem with handbags among young women

Coach has reported poor results for the second quarter of fiscal 2016.

Comparable sales at the fashion company’s North American stored declined 4% and overall brand sales dipped 7%. Internationally, overall brand sales increased by 4%.

Coach has worked tirelessly to attract new customers and keep fans of the brand. The company has updated stores and stopped deep discounts that were hurting its image.

According to a recent study by Goldman Sachs and Teen Vogue, many popular brands that design accessible luxury handbags are “falling flat,” as “it girls,” ages 13-29, abandon the once popular accessory.

The Goldman Sachs report says Coach bags is the “well-owned” brand among it girls, followed by Michael Kors bags.

“In our view, while Coach is far from being a completely broken brand it remains in transition,”Håkon Helgesen, retail analyst at research firm Conlumino, wrote in a note to clients. “In trying to move from a position of ubiquity and volume fueled by promotions, it is struggling to regain the premium, more niche status it once held. As such it is currently stuck in something of a netherworld that is inflicting a measure of financial pain.”

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“Admittedly, with Coach’s restructuring efforts and its attempts to move away from excessive discounting, some deterioration to the topline is to be expected,” Helgesen adds.

Written by Tammy Johnson

Tammy Johnson

Tammy Johnson is the Retail Editor at BusinessPundit. She focuses on Fortune 500 retail company's and disruptive brick-and-mortar and e-commerce companies that are changing the retail landscape.