With the agreement to buy Jimmy Choo for 869 million pounds ($1.2 billion), Michael Kors has expanded their handbag closet to make room for shoes, albeit the crystal-encrusted stilettos favored by Sex and the City’s Carrie Bradshaw.
Michael Kors had once been the leader of the “accessible luxury market,” but after going public in 2011, the company has been struggling in an increasingly competitive retail market. The slow death of traditional malls in North America hasn’t helped, either, with shoppers gravitating towards the polar ends of the retail spectrum with fast fashion brands and higher-end luxury brands.
The ethos behind the Michael Kors brand, as characterized by chief creative officer and namesake Michael Kors himself, is the notion that every woman simply wants to look “pretty and rich.” This approach, delivering an aspirational glitterati aesthetic to the wardrobes of many women, was wildly popular for some time before and shortly after 2011. The price point and designs fit its culture of accessible luxury.
While you shouldn’t anticipate gold JC medallions hanging from your Jimmy Choos anytime soon, the consolidation of the two companies helps diversify the Michael Kors brand and offers them an entry into the high end luxury market. This move isn’t entirely out of left field, as Coach, another fashion company trying to revitalize itself after some rocky sales seasons, acquired handbags and accessories brand Kate Spade for $2.4 billion after rounding out its portfolio with upmarket shoemaker Stuart Weitzman.
Images courtesy of michaelkors.com and jimmychoo.com