Tapestry, the company that owns Coach, Kate Spade and Stuart Weitzman, is placing a bet on customization as it expands two platforms that let customers personalize products.
As customization becomes more relevant to fashion brands, few other retail companies have invested in customization platforms like Tapestry. As part of the business’s ongoing restructuring strategy, customization plays a role in pivotal goals like reducing promotions, improving pricing structure, and mining customer data around trends and buying behavior, in order to speed up the supply chain.
After launching Coach Create and Kate Spade Make It Mine at the end of 2017, each program is being rolled out to include more products, categories and store locations. Coach Create, the brand announced, is expanding to six new international markets and 250 store locations (about 40 percent of the total store count), and adding the footwear category this year. The initiative started by offering customization services in 36 retail stores and online, letting customers design handbag features and add accessories and monogramming. Coach Create itself is an expansion on the first made-to-order Rogue bag, which is customizable from start to finish with over 1 million design combinations, first introduced at the brand’s New York flagship in 2016.
At Kate Spade, the Make It Mine platform now gives customers 45 customizable bag design options, as well as the option to add accessories and monogramming to jewelry, bags and accessories. In stores, Kate Spade uses Perch technology to recreate the online product customization experience, by activating sensors when customers pick up a bag that can be customized. Once they do, a digital screen pulls up all possible embellishments, as well as a tutorial video demonstrating how to make a bag personalized. According to Kate Spade CMO Mary Renner Beech, Make It Mine draws about 120,000 interactions monthly, but the brand didn’t offer any other figures.
“We’ve been encouraged by the reception of customization at both brands, and we’re going to continue to expand it to more store locations and with more design options,” said Victor Luis, CEO of Tapestry, which owns Coach and Kate Spade, last week to investors during the company’s third quarter financial earnings.
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Customization and personalization has become more relevant in premium and luxury fashion as brands respond to customers’ desire to own original, one-of-a-kind pieces. Beyond Coach and Kate Spade, brands like Chloé, Gucci and Diane von Furstenberg have launched customizable product collections around specific campaigns.
“Businesses that embrace personalization have a differentiated proposition that could lead to sustainable growth,” said Celine Finch, Deloitte’s consumer business research lead. “For high-end brands, recognizing that this is the new luxury customers want is going to prove profitable in the long run.”
According to Coach CEO Joshua Schulman, Coach Create is meant to not only promote full-price purchases (while outlet remains part of the brand’s retail strategy, the brand has pulled out of overly promotional wholesale accounts over the past year), but to push purchases into a higher price range.
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“Our strategic intent has always been to address the gaps in our handbag assortment, adding more weight between the $300 and $400 price tag as our sweet spot,” said Schulman to investors about Coach Create. “And so we’re really thinking about things in terms of a good, better, best hierarchy and how we can best balance that.”
Product customization also provides a gateway to richer customer insight, since those who design customized products online or in stores are prompted to submit more information than they would for a typical purchase. Tapestry’s customer database is the engine driving the company forward for the future across all three brands, and that includes incorporation for technology like artificial intelligence and machine learning.
“We currently have over 120 million names in our database, and one of our key objectives is to leverage that data that allows us to think about how we can not only approach consumers more directly in a more customized manner, but also in terms of how we think about leveraging machine learning for the inventory management process internally,” said Luis on a recent earnings call. “These are all areas that we’re having discussions on and working on right now, so it’s a very exciting space indeed.”
