On July 25th, 2017, the news that surprised the fashion world broke: Michael Kors has purchased the Jimmy Choo brand for 1.2 billion. This deal, unlike the Coach and Kate Spade acquisition that we covered earlier this year, has taken the fashion world by storm as many were left to ponder what the Michael Kors brand would do as its next step.
Having faced drops in their sales over the past few quarters, a result of the drop in mall-shoppers and the brand's oversaturation of the market (thanks, Nicki Minaj), Michael Kors purchasing Jimmy Choo is a surprise to us all. The logic behind the move, though, is strategically meant to ensure the brand's long-term success and longevity to survive the ebb and flow of modern shopping fads.
We're going to break down Michael Kors' survival strategy of buying the Jimmy Choo brand and sealing themselves a higher rank in the luxury industry.
Michael Kors As We Know It
The Michael Kors brand was synonymous with being on the edge of fashion, following the latest trends, and liking affordable luxury that could let you show off a little bit.
Established in 1981, the Michael Kors brand has spent the last 35 years building an empire that seemingly peaked with Nicki Minaj's 2011 hit song referencing the brand. Whether you're a fan of Nicki or not, Kors reaped the benefits of his mention (while also admitting that the song itself was too risque for his own taste). The result? The Michael Kors brand, already well-respected, sky-rocketed toward a much more wild realm of success.
Much like brands like Coach, who found themselves suffering from the unexpected side-effects of market oversaturation, Michael Kors has felt pressure, in the form of decreasing profits, to decrease their presence in retail stores and malls.
The Michael Kors 2017 collections are all about the modern, festival-inspired summer looks that are popular this year. Their Instagram is even organized by color themes, which lends to the overall Instagrammer's dream aesthetic. Collections include pops of color, sturdy materials, and classic silhouettes that are designed to move the wearer through the year in style. In other words, they still get it despite their struggles in the market.
Moving into the luxury realm, through the Jimmy Choo brand, is a move we respect, as Jimmy Choo's long history for luxury and craftsmanship (not to mention their price point) is exactly what Kors needs.
What the Jimmy Choo Brand Has to Offer
Jimmy Choo was established in 1996. Though the brand is younger than Michael Kors, it has found its way into the hearts of luxury's biggest lovers—not to mention into the fictional fashionista (and shoe-lover) Carrie Bradshaw's dream closet.
Focusing on relevant campaigns, Jimmy Choo's collections maintain the classic style and structure that the brand is known for. Their shoes are beautiful, of course, but their designs when it comes to bags, sunglasses, and other style staples are equally awe-inspiring—living up to the reputation that has been attached to the Jimmy Choo brand name for two decades.
In 2014, Jimmy Choo even launched their men's fragrance with Kit Harrington, star of Game of Thrones, as its figurehead. This attention to trend, and bringing on celebrities at the height of their popularity, shows that the Jimmy Choo brand is aware of what it needs to survive in this modern fashion era.
The Jimmy Choo brand doesn't just offer shoes. Bags, small and leather accessories, scents, and bridal wear are available and also showcase the brand's attention to structure and quality. Because of their multiple product offerings, highly revered name, and successful history, Michael Kors has many things to gain from bringing Jimmy Choo onto their roster.
Similarly to Coach and Kate Spade, it's possible that Michael Kors is looking to create a fashion conglomerate of their own over the next few years. Starting with a big name like Jimmy Choo is a prolific first step in the direction of not only bringing the Michael Kors brand back, but elevating them to the next level of luxury fashion and buying—a situation which would help alleviate the oversaturation of Michael Kors product in the fast retail realm.
Michael Kors moved quickly, honing in on their potentially new acquisition since the news of Jimmy Choo hitting the market only broke in April of 2017. Because an investor who owned 70% of Jimmy Choo pulled out after a 10-year tenure with the company, it was the perfect time for Kors to bring the renowned brand onto their team. To win Jimmy Choo over, a bid of 1.2 billion was placed and accepted.
With time, we'll be able to see the full scope of this purchase and the benefits it can bring to both brands. In the meantime, we'll just be as surprised as the rest of the fashion world and give Michael Kors the praise they deserve for making such a bold and strategic move.