I first became familiar with Coach purses in my mid-teens, when my mother started buying up dozens of them before biannual trips back to Shanghai. They were the perfect gift -- stylish, durable, appropriately priced, and wildly popular in China, where the craze for designer bags had turned them into collateral at pawn shops and their counterfeiting into a veritable cottage industry.
During those early years, the brand abroad still operated under a strange, franchise-like structure: domestic retail stores -- one in Macau, eight in Hong Kong, and 15 on the mainland -- were managed directly by the ImagineX Group, a Guangzhou-based distributor of luxury goods. The partnership was industry standard; it gave the parent company a chance to test local waters at low risk, and the distributor entre and prestige. This period also marked the launch of a new flagship store on Queen's Road Central in Wan Chai: 50,000 square feet of svelte minimalism in Hong Kong's premier shopping district, meant to announce to all the big boys -- LVMH, PPR, Prada -- that Coach had arrived.
But at the same time, Coach was targeting a different market altogether. A Hermès bag starts at $800 and can easily reach the high four digits; Coach bags top out at $400. For the young urban professional in China's top-tier cities, a Coach purse was an affordable alternative. The trick was convincing them that it was also a fashionable one.
This turned out to be difficult. In the past, luxury goods were so named because they were constructed by expert craftsmen from rare materials. But after the Second World War, the dynamics shifted. The value of a brand grew to be not only a function of cost and labor, but of who had designed them, who was selling them, and who was wearing them. Coach lacked the pedigree of the big Italian and French designer houses; at heart, it was a solidly New York fashion brand. But this same middlebrow-ness left it free to experiment with promotion, online retail, factory stores, and ultimately, profit, while remaining true to its message in a way that would have been unimaginable for the likes of Chanel.
Which was not to say that Coach didn't also engage in the trappings of traditional retail marketing: There were advertisements in magazines and launch parties with appearances by B-list celebrities. Late last year, Coach signed Taiwanese mega-star Wang Leehom as an ambassador for their men's accessories line. New York-born and educated at Williams, Wang's command of English and pop idol good looks made him a natural frontman. The subsequent photo spreads were shot with a crisp lens in view of the Brooklyn Bridge and featured Wang looking alternatively pensive, cool, and dashing while strolling the streets of lower Manhattan clutching oversized man-purses.
But Coach's very choice of Wang Leehom was a departure for a Western company. For decades, Chinese consumers had associated luxury goods with imports, to the extent that even homegrown labels featured Caucasian models. Unlike Starbucks, or McDonald's, which had to contend with existing tastes for say, fatty pork or wedgy potatoes, the luxury clothing and accessories market in China was, until the 90's, a tabula rasa.
So while conventional wisdom might have suggested a certain amount of "China-fication" -- does it really make sense to show Gwyneth Paltrow in an ad to people who barely know what a downward-facing dog is? -- in practice this was rare. Wang Leehom was one of the first Asian celebrities to sign an exclusive contract with a Western luxury brand, and he was quickly joined by the actress Fan Bingbing for Louis Vuitton and the actor Chow Yun-Fat for Hugo Boss.
When I spoke with Coach executives in New York, I asked them about their strategy. How had they started out? What had they done to establish themselves as a brand worth coveting? Or phrased another way, what prevented me from flying to Shanghai, setting up shop, and calling it luxury?
The basic answer -- distilled through layers of corporate doublespeak - was that Coach had been particularly savvy when it came to their digital marketing efforts. While other companies struggled to offer a decent Chinese language website, Coach took to the country's social networks. They launched campaigns on Renren, a Facebook-like site, WeChat and Sina Weibo, soliciting feedback and raffling off purses. They asked fans to post pictures of themselves carrying Coach wares on TuDing, a knock-off version of Instagram.