The Business of Bagging Customers

The Business of Bagging Customers case study focuses on Coach Inc. and the strategic efforts of it's CEO Lew Frankfort. Frankfort determined through careful planning that to make the business a success they needed to find a differentiation strategy to compete with saturation of big names ( Gucci, Louis Vuitton and Prada) in the fashion industry. He recognized the need to take Coach to another level by declaring itself independent from the mother company Sara Lee. Two reasons a company may decide to spin off from a parent company are the company has adopted a strategy to focus on its core activities and/or the company thinks that the spun of activities can be better developed on their own, rather than as part of a bigger concern.

Frankfort exhibited strong conception and strategic skills which are vital as CEO of the company.

The steps Frankfort followed in his planning process were to establish the goals of the company which meant a large amount of planning, determining the gap, developing an action plan, and formulating a tactical plan for implementation and then lastly to assess all of these to ascertain success. Coach's focus was on strategy including differentiation to ensure the sustainability in a thoroughly saturated market.

One of the tactical plans Coach uses is one on one surveys of customers in 12 different locations around the world. This ties into geographic expansion and offers international networking by expanding the companies operation into new geographic areas. The business spends $2 million per year on surveys using methods of large companies and creates demand forecasting made from these evaluations.They start testing again 6 months before introduction ensuring that the market and demand is still viable for the chosen line of products. Coach also recognized by doing market research that there was an increase in sales in the Hispanic culture