Hours earlier, Tapestry Inc. had staged an even more intense catwalk in a Lower Manhattan Courtroom. This is not just a fashion battle; it’s also a fight over markets, power and the future.
We can’t help asking, when two fashion giants, Coach, and Michael Kors merge, how this merger will reshape fashion as we know it. How will this merger affect us, as consumers?
Tapestry Inc. (which owns Coach, Kate Spade and Stuart Weitzman) is being sued by the Federal Trade Commission. The FTC is trying to stop its $8 billion purchase of Michael Kors parent company Capri. The FTC claims that the merger would eliminate competition and unfairly increase prices in the affordable luxury handbags market. Tapestry counters by saying that consumers have plenty of options, including direct to consumer startups like Telfar Cuyana Brandon Blackwood and Senreve.
This court battle is more than just a merger of two brands. This court battle is at the core of the American fashion industry. Can we create a fashion group in America that can compete with French giants LVMH or Kering? It’s all about the future of American Fashion and the diversity of choices we have as consumers.
Coach’s transformation as a crazy-discounter into the first choice for young consumers has proved the success of its marketing strategy. Coach’s sales increased by 3% in the fiscal year that ended June 2024, to $5 billion. If the merger is successful, Tapestry hopes that it can bring the same transformation to Michael Kors. Revenues have fallen 14% due to a slowing market for luxury goods.
Imagine choosing a Coach handbag or a Michael Kors bag in a store, knowing that you are not only based on brand, but also on design, price and quality. This court case is about your right as a consumer to choose.
Fashion is about freedom and choice, not just clothes. The merger between Coach and Michael Kors is all about our right to choice as consumers, and the future of American fashion.
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