Established more than two decades ago, Kate Spade New York is an American luxury goods company based in New York City’s garment district. Kate Spade has expanded beyond just purses from handbags to stationery to raincoats to pajamas to eyeglasses to beauty goods. The company has also expanded into the publishing of books and the recording of music. You can find products by Kate Spade in high-end department stores and 15 of the company’s stores. Kate and Andy Spade are the driving force behind the Kate Spade brand. The Neiman Marcus Group, Inc. owns a significant stake in the corporation. This article explores Kate Spade New York’s history.
Kate Spade History— Evolution of Kate Spade New York
Upon graduating from Arizona State University in 1985, Spade went on a European backpacking trip. Mademoiselle magazine hired her in the accessories department the following year after relocating to New York. Katherine Noel Brosnahan, who was always on the hunt for the perfect handbag, decided it would be easier and more exciting to design her own. Here’s some history behind the Kate Spade brand.
Launching Kate Spade New York
Kate Spade, born Katherine Noel Brosnahan, and her then-friend Andy Spade, whom she eventually married, founded Kate Spade New York (KSNY) in 1993. After six years at Mademoiselle, Katherine wasn’t sure what she wanted to do next, so Andy came up with the idea of starting Kate Spade New York. In the beginning, Sam handbags were all that the company made, and they were all bright and cheery. To make Kate’s bags, Andy had to take a loan of $35,000 from his 401(k). Kate Spade New York’s first collection was a square bag with a black label embroidered on the outside that read “Kate Spade New York.” The upper-middle-class was their primary demographic (target market). The duo started with six purses, one made from burlap purchased from a potato bag manufacturer.
Spade’s urgency prompted her to scour the Yellow Pages and her fashion magazine contacts for handbag suppliers. An apartment-based pattern maker was the best option because she had no previous experience in the field. De facto, an apprentice there, Kate clipped large sheets of paper and fabric swatches until the new skills became a habit. A New York City trade fair cost the Spades more than $4,000 in supplies and entrance in 1993. It didn’t go as well as she’d hoped.
First Shop and Profit
The first store for Kate Spade and Company was founded in 1996 in the SoHo neighbourhood of New York City. The stock of Kate Spade increased in value within eight months after a writer at Cleveland Research Co. suggested purchasing the company’s shares due to the brand’s growth potential.
They did not start turning a profit until 1996, three years after being incorporated. In the same year, Kate Spade was recognized by the Council of Fashion Designers of America (CFDA), an organization that more commonly honors fashion labels such as Ralph Lauren and DKNY. Then, Saks Fifth Avenue and Neiman Marcus contacted Kate Spade and requested that their bags be stocked in all their locations. Their revenue almost quadrupled as a direct result of the expansion.
Initial Licensing and Hiring a CEO
Inked in 1998 with the Willard Group, Kate Spade’s initial licensing arrangement was for stationery items, in keeping with the company’s unconventional approach to business. Formal stationery and diaries were part of the Kate Spade Paper Collection. They also included organizers and agendas. The fabric was used to adorn the stationery items to match the then-current handbag range. During the summer of 1998, Kate Spade hired Stephen Ruzow, the former president of Donna Karan, to serve as its CEO and supervise expansion. However, Andy and Kate Spade were apprehensive about expanding the licensing program at such a rapid pace.
Sold 56% Stake to Neiman Marcus
Many companies sought to acquire all or a portion of Kate Spade, characterized by its simplicity and elegance. When Neiman Marcus approached Kate and Andy Spade, they accepted because they were assured they would retain creative control of the brand they started. To buy a 56% stake in the business, Neiman Marcus paid $33.6 million in February 1999. The Spades owned the remaining 44% and were still in charge of the company’s day-to-day activities. After a few months of searching, Kate Spade finally discovered the ideal executive to offer professional managerial skills to the company in the following months. Robin Marino, a former Donna Karan executive, was chosen as the company’s new president. Kate Spade made sales of over $25 million in 1998 and $50 million in 1999. However, Andy Spade was retained as the company’s CEO.
Kate Spade Introduces New Products
Additional licensing agreements were established in 1999, but only in areas where the corporation felt it could offer a distinct advantage. It licensed raincoats after realizing there was a market for something other than Burberry beige. Socks were one of Kate’s long-term ambitions. She patiently waited for the ideal partner before signing a licensing arrangement with GFW Group Inc. Fashion designers Adrienne Vittadini, and Isaac Mizrahi relied on New York-based GFW for their shoe business. In addition, in 1999, Kate Spade and The Estee Lauder Companies formed a joint venture to create cosmetics and associated products. The Jack Spade line of men’s tote bags, initially marketed in a hardware shop, was introduced in the same year. After creating the Delta Song airline’s uniform, Kate had little interest in launching her clothing brand.
Kate Spade had five locations in the year 2000. These included three handbag boutiques located in New York, Boston, Beverly Hills, and Kate Spade Paper and Jack Spade stores on Manhattan’s Fifth Avenue. Greenwich, Connecticut, and Chicago, Illinois, were also scheduled to open. The firm negotiated a licensing agreement for upmarket women’s eyewear, frames, and sunglasses, which had been a long-term goal of the company’s research. Safilo Group, a prominent Italian eyeglasses manufacturer, was its business partner. As of 2001, Kate Spade expanded her horizons to include home goods such as tabletop items, fabric, and bedding. The company also signed a deal with Simon & Schuster in 2002 to publish three books about style.
In 2006, Neiman Marcus, which two private equity groups had acquired, bought the remaining Kate Spade shares. Liz Claiborne, a clothing retailer that had previously purchased Juicy Couture and Lucky Brand Jeans, acquired the Kate Spade package from Neiman Marcus for $124 million. When the Spades departed the brand in 2007, it made over $80 million in revenue annually. Tapestry’s corporate company bought Kate Spade & Co. for $2.4 billion in May 2017. Offshoots (subsidiaries) of Kate Spade, such as Kate Spade Saturday and Jack Spade, had shut down.
In 2016, the Spades and two partners stealthily launched a new firm, Frances Valentine, which sold accessories including handbags, footwear, and clothing online and through stores like Bloomingdale’s and Nordstrom. In June 2018, Kate Spade committed suicide in her New York City home. The company pledged $1 million to a mental health awareness initiative in honor of its late founder, donating a $250,000 gift to Crisis Text Line.
Kate Spade’s Marketing Strategy Drives Its Success
This section highlights the driving strategy behind Kate Spade’s success.
Consistent Visual Aesthetics
However, even though its items can cost up to $400 for a purse and $200 for a pair of heels, its prices are much lower than those of other high-end businesses. This implies that for those who can’t afford the likes of Gucci or Chanel, Kate Spade is an excellent substitute. Bright, eye-catching patterns and prints are a Kate Spade signature. As a result, its advertising has always reflected this lighthearted tone. A Kate Spade woman is a woman who enjoys a fast-paced lifestyle and is always on the go. For this reason, Kate Spade stands apart from the competition.
Kate Spade’s catwalk displays are notable for their upbeat tone and design aesthetic. Kitchy purses and attractive outfits that are worn daily are seen on its models. All the ensembles are feminine and charming with a retro vibe; they’re also fun and girly. Another amazing thing about Kate Spade is that it isn’t just for young individuals in New York City. Working ladies, suburban homemakers, party girls, youngsters, and new mothers can all find something they like.
Because it appeals to the Kate Spade woman’s sense of taste, it will always sell chic handbags and bright kitten-heeled shoes. It’ll follow new fashion trends, but only if they’re in keeping with the brand’s eccentric aesthetic.
The Company Aligns All Social Media Campaigns with the Brand’s Persona
The Kate Spade brand’s voice has remained consistent across multiple social media channels. Kate Space promotes its products and relays information about the company via Instagram, Twitter, and Pinterest. Handbags from the Kate Spade collection Twitter’s captions have a personal tone but don’t appear to be written by a real person. For example, in the case of Kate Spade, the brand’s voice is upheld while tweeting about its newest products and marketing campaigns. Kate Spade’s Instagram, of course, features images that reflect the brand’s style and inspirational quotes for its target audience. An air of sincerity is refreshing after reading so much corporate speak. Pinterest is the best place to showcase its photogenic products and fashion inspiration, with boards devoted to holiday gift guides, handbags, wedding parties, and colors.
According to Forbes, Kate Spade had a 2016 net worth of $3.1 billion. This is an incredible achievement in light of the brand’s relative youth compared to other brands. Kate Spade’s brand has a cheerful, inviting atmosphere, which is part of its appeal. Kate Spade handbags and purses stand out from the crowd thanks to their striking patterns, bright colors, and cool-girl vibes.