Coach is a company founded as a partnership and known as the Gail manufacturing Company in 1941 in Manhattan, New York. Initially, the Company was family owned until 1985 when the firm was purchased by the Sara Lee Corporation as a subsidiary until 2001 when it regained independence through a spinoff. The Coach Leather ware Company, Inc. mainly deals with the business of manufacturing of leather goods such as handbags, wristlets, shoes, jewelry, gifts, poppy and wallets.
The company is therefore well known for manufacturing of high quality leather products. The company has approximately 10, 100 employees with a total equity of 1.70 Billion dollars. Coach, as a producer, marketer and designer of a prestige line of briefcases, luggage, handbags and accessories has made its reputation through the sale of study leather purses in traditional, unchanging and classic styles which has made it to remain one of the renown leather brands in the U.S and a reputation which has continued to grow overseas.
Being the newly hired distribution manager for the company’s brand products and goods, this is a report on how the designers brand products and goods are marketed and the changes that can be made to ensure that the distribution of the company’s products and goods is effective.
Marketing Channels and Channels of Distribution:
A marketing channel or a distribution channel is the path through which products and services flow in one direction from the vendor to the final consumer while the payments that are generated by the products and services flows in an opposite direction from the consumer to the vendor. It also entails how the goods are supplied from the vendor to the final consumer and it may include the direct supply of goods from the vendor direct to the consumer or it may include various interconnected intermediaries like agents, retailers, wholesalers and distributors. Each of these intermediaries will normally receive the product at one pricing point and then they move the product at the next pricing point till it reaches to the final consumer (Gelder, 2003).
The Coach Company conducts its operations via two segments of indirect and direct to consumers and its operations are segmented on the basis of the distribution channels. The Coach Company’s factory stores and operated retail stores based in Japan and North America. Currently, the Coach Company operates 86 factory stores in North America and 218 retail stores with flagship stores in San Francisco, New York and Chicago which give the clients a broad assortment of the company’s products. The Coach Company also emails advertising and promotional materials and markets its products online.
The management of distribution channels is very vital to the Coach Company. Currently, the company offers some of its products like footwear, home and office furniture and Coach Brand watches through agreements which are signed by its licensing partners. The company therefore achieves 2/3 of its sales through direct-to-consumer channels. Some of these direct to consumer channels comprise of approximately 190 Coach Stores located in the United States of America of which out of these, one hundred and twenty are retail stores while the remaining ones are factory outlets which include an online store and direct mail catalogs. Apart from these, the Coach Company also has 175 Coach Locations distributed in 18 countries outside the United States of America. The company also distributes its products through indirect channels like wholesaling of its brand products to about one thousand four hundred (1400) specialty store locations and departments in the United States of America (Grubb, 1967).
The distribution of Coach designer’s/brand products/good makes them to be different from its competitors because the company uses young advertising agencies to market its products to young customers through deigning of campaigns featuring various themes and therefore easily attracting the attention of the young clients whom competitors will normally find it hard to sell to. The company further exploits the appeal of its brand name through enhancing its line of women’s and men’s socks and therefore making it to be unique from its competitors. The company’s distribution channels also makes the Coach Company to be different from its principal competitors like Gucci Group N.V, Dooney and Bourke Pr Inc and Jones Apparel Group because it uses principal subsidiaries which use its brand name “Coach” before their names and therefore increasing the marketability of its products.
Channels and factors affecting the success of a distribution Channel
The selection of a distribution channel of a company will normally be affected by various factors which play a vital role for the distribution of a company’s products. The selection will depend on the resources available for the company and the buying pattern of the final consumer not forgetting the type of product that the company is offering. Some of the main factors affecting the selection of a channel of distribution for the Coach Company products will therefore include the objectives of the company, the nature and extent of the Coach Company’s market and the existing channel for the comparable product. The availability of the channel and the buying habit of the clients will also influence the type of distribution channel to be used by the Coach Company (Binkley, 2011).
How to change the distribution of Coach Products:
The distribution of the Coach products should be altered to cater all the distribution channels so as to increase the sales of the company. In order to increase the distribution of the Coach Company’s designer/brand products the company should increase its online stores and adopt the use of Information and Communication Technology in managing its operations. The company should also to increase its distribution channels in other countries outside the United States of America so as to increase its sales. The company should adopt the use of electronic commerce (e-commerce) to market its products beyond the United States so as to increase the number of customers who may be willing to buy the products but have no information about them.
Additional coach outlets should also be constructed in places which have a higher demand for Coach Products so as to fully cater for the needs of the customers. Similar boutiques offering Coach Products should also be opened within other major department stores to cater for the increasing number of clients purchasing Coach Products. Such expansion would greatly boost the company’s sales. The company’s customer base should also be broadened by designing products suitable for the different locations selling the Coach products. The company should also strive to meet the growing demand for its products by increasing the workforce and expanding the work week to include overtime employees.
Intensifying the Level of Coach Products
The level of distribution for the Coach Company should be made to be more intense because the wholesaling distribution being currently used by the company does not cater for the needs of all the company’s clients. In order for the company to reach to other potential customers, it should then adopt other distribution channels like selling directly to customers like retailing and further increase the number of vendors buying the company products so that it becomes easier for the company to distribute its products all over the world. By intensifying the level of distribution, the company will be better placed to offer the products to the various customers distributed all over the world who will easily access the products evenly distributed in various locations all over the world. The company should further expand its channels of distribution and accelerate the development of new products and product categories both at home and abroad (Baker, 2007).
The designer’s/brand’s products which are offered in additional outlets should continue to carry the current Coach Company brand and not a new brand by that designer so as to make the company products to be unique from those of the Coach Company’s competitors. This is because by allowing the designers to have new brands, this will make them to directly compete with the Coach Company products and therefore maintaining the Coach brand is suitable for the company. allowing the designers to have new brands will equal to having the different lines being sold in different stores like in the case of Calvin Klein versus CK and Donna Karan versus DKNY. Retaining the brand name will therefore ensure that the same line of products are sold in the different stores.
The name of the brand will normally never vary between the various types of stores. For instance, the products found in designer/brand owned stores of the Coach Company, discount department stores and high end department stores are normally the same as those found with the mass merchandisers. The Coach Company’s customers are normally different from the customers found in its subsidiaries despite the fact that they buy the same brand of products (Mercer, 2000).