hoes and Handbags
The popular shoe brand, Jimmy Choo, is to be bought by the fashion brand Michael Kors for $1.2 billion.
Jimmy Choo shoes were made famous after featuring on the feet of Princess Diana, and the generation defining women of Sex and the City. As a brand, they were an attractive feature for many women’s wardrobes.
The shoe brand retail from anywhere from $400 to $3000, which makes them a lucrative investment for Michael Kors.
Michael Kors became a household name following the appearance of the eponymous founder on a reality TV series ‘Project Runway.’ For a number of years, the brand enjoyed much success, with many women investing in a handbag. It was seen as an affordable luxury item. The mantra of the founder was to bring high-end fashion into the homes of ordinary women. However, since going public in 2011, the company has suffered financially. Its share price lost a fifth of its value in 2017.
The takeover comes in light of a rough period for the retail industry. Stiff competition comes from online stores and affordable outlets such as H&M and TJKMaxx. People have become more selective when buying fashion products. Technology and innovation have allowed consumers to avail of cheaper deals, compared with the prices of high-street stores.
In that context, Michael Kors seeks to diversify its brand. Attempting to widen its share of the retail industry, the handbag company is seeking to reverse its losses. Michael Kors CEO John D. Idol said that he believes Jimmy Choo “can more than double its sales to $1 billion annually.” The two brands will continue to operate “very independently,” he added, but will together comprise a “global fashion luxury group.”
Jimmy Choo will continue to be run by CEO Pierre Denis, who has held the top position in the company since 2012.
The acquisition comes on the back of the acquisition of Coach by Kate Spade for $2.4 billion, as the retailer aimed to attract a younger consumer.