Men can be a dangerous group to court -- look at Juliet. It's not easy or cheap to take a brand known for its women's clothing and accessories and make it appealing to men. Imagine the amount of work that a company like Coach (NYSE:TPR) would have to expend in order to make men's successful. Actually, you don't have to imagine. Coach put its money where its mouth was and pushed its men's line heavily. It succeeded, in some sense, driving men's sales up. But it lost focus on its core women's business and things fell apart.
In an attempt to expand its already huge market footprint, Michael Kors (NYSE:CPRI) is also getting into the men's game. The question is whether it will go the way of Coach, or if it can actually keep its focus sharp while picking up a new line.
Kors' menswear plan
The idea of selling men's accessories isn't new to Michael Kors, but the push is coming. Kors announced that its new SoHo flagship store will be its first to "showcase our men's ready-to-wear and leather collections." To support turning that first step into a bigger success, Kors just added Mark Brashear to its lineup as the head of men's. Brashear worked at Hugo Boss, where he was CEO and chairman of the Americas.
At Kors, Brashear is going to be jumping into the deep end, joining as the company launches a new fragrance for men, a line of men's watches, and its SoHo store. It's the beginning of what Kors thinks could be a $1 billion line of business, split among clothing, watches, and leather.
If that lineup and optimism sound familiar, you might be thinking back to 2011 when Coach was telling investors that men's sales could account for 25% of the company's growth in the coming years. As it turns out, it's accounted for much more than that, but only because Coach's total sales have been so weak. For the first three quarters of fiscal 2012, Coach had total sales of $3.6 billion, and in same period for fiscal 2014 it had $3.6 billion in total sales. In this most recent quarter, men's accounted for 15% of total sales.
Where Kors can win while Coach lost
Coach didn't fail at making its men's line a success -- the line has done well. The problem is that it lost its focus and tried to solve a dozen problems all at once. Kors can avoid that misstep by taking its men's line slowly and by making sure that it grows this business separately, not by drawing on the resources of its core business.
Michael Kors has done well with its main business, and comparable-store sales were up 26.2% last quarter. It has the momentum to turn its business into a much bigger business. The hard part will be making it work the way it has to. Brashear's experience at Hugo Boss will help, but Boss was always focused on men. Brashear and Kors need to find a middle ground where they split their focus without either segment feeling left out. I think Kors has the ability to make this work, but it's a fine line to walk.