Michael Kors Pulling Back On Department Store Presence In Effort To Polish Brand’s Image

Image courtesy of JeepersMedia

Yet another designer brand has decided to pull back on its department store presence in an attempt to polish up its image in the eyes of consumers and boost flagging sales. Michael Kors announced it will no longer accept coupons for its merchandise sold in department stores, and will be pulling back from that category in general come next year.

After reporting a 7% dip in its wholesale business — department stores — during the first quarter, Michael Kors CEO John Idol said that starting in February 2017, the brand won’t participate in department stores’ “friends and family sales,” as well as nixing coupons, CNBC reports. It will also continue to cut back on how much merchandise it ships to department stores, a process that’s already underway.

Deep discounts have led consumers to think that the brand is worth less than it is, Idol says, which has led to dips in revenue and profit margins in both department stores and standalone retail locations.

“It’s creating confusion in the consumers’ mind relative to the value of the Michael Kors brand when it’s being seen so often on sale in so many different places,” Idol said. “We have to correct something that we think is actually having a negative long-term effect for the brand.”

Michael Kors has also been hit by the same decrease in tourist traffic that’s beleaguering Kate Spade and Abercrombie & Fitch. Also this week, Coach announced it’d be pulling back from department stores as well, with plans to close 250 of its wholesale locations.

Michael Kors is fed up with department stores damaging its brand [CNBC]