Coach and Kate Spade are top-performing brands in L2’s Digital IQ Index: Specialty Retail with significant investments in Product Listing Ads (PLAs). However, each have varying strategies, discussed and compared in the study.
In sum, Coach takes a focused approach with the goal to appear consistently on a select group of terms that are core to its accessories business. Coach generated over 90% of its non-branded PLA exposure from the handbags, watches, and leather goods categories. Although the brand appears in half as many searches as Kate Spade, it makes up for it in consistency. Data shows that Coach PLAs appear 50% of the time for the same set of terms.
Kate Spade casts a much wider net and appears in search results for ten distinct categories. However, it appears only 30% of the time.
Coach’s strategy helps protect brand equity by maintaining an association with priority product categories. It also ensures that repeat searchers will encounter the products they were interested in buying. This is effective for targeting a core group of customers but ineffective for stretching the consumer base or advertising new products.
Kate Spade, however, is able to capture new customers and push new products at a lower cost (lowered by the flexibility of its PLAs). The tradeoff is reduced brand equity in native categories like handbags.