Is Michael Kors' popularity going to be its downfall?
MICHAEL Kors bags are everywhere. It's almost impossible to walk through any British city without spotting at least one of the chic leather totes.
And the brand's surge in popularity hasn't been limited to the UK. Sales of the luxury brand across North America, Japan and Europe have tripled in the last three years.
But in February the designer reported a slowdown in sales at the end of last year and shares in the company have recently dropped. And
now Michael Kors has been removed from Morgan Stanley's Best Ideas list, which means that the bank no longer thinks of the brand as one of its most favourable investments.
Critics fear that its surge in popularity could be what sinks the company, in a similar vein to Burberry's well documented struggles of the late 90s when its popularity peak lead to it quickly falling out of favour.
Speaking to the Express Online, Jonathan De Mello, head of retail consultancy at Harper Dennis Hobbs, said there are two types of ubiquitous brands, the one that allows its popularity to become its downfall and then fails.
And the one that is constantly able to reinvent itself to eventually become a 'hero brand'.
He points to Chanel, Dior and Tiffany as the kind of retail brands that have managed to move with the times and stay relevant and desirable to consumers. And explained that the key is to make sure the brand remains exclusive to the consumer.
"If everyone sees the brand it loses its exclusivity. Consumers don't want to be sheep and are always looking for the next big thing. Familiarity breeds contempt- especially in fashion," he said.
Burberry was able to pull its company back from the brink after restricting distribution and now Michael Kors must do the same, he said.
"The question for Michael Kors is whether it can maintain relevance and go on to become a hero brand," added Mr De Mello.
