By , Lisa Fickenscher
Published August 15, 2018
Kate Spade sales surged after the handbag maker’s namesake and founder committed suicide in June, the brand’s parent company said Tuesday.
New York-based Tapestry — which also owns Coach and Stuart Weitzman — said sales of the brightly colored handbags and accessories helped fuel a 31-percent spike in fourth quarter revenues, which sent shares of the company up 12 percent, to $53.16, on Tuesday.
That’s despite the fact that Spade, who died at age 55, had sold her interest in the brand and not been associated with the company for a decade.
“The average person on the street doesn’t have a clue about that,” said Craig Johnson, president of Customer Growth Partners. “She was much loved and admired for many years, and people bought her brand to pay tribute to her.”
In the immediate aftermath of Spade’s death, her namesake merchandise sold out, including on resale Web sites like Poshmark, which saw a 600 percent increase in Kate Spade sales, according to reports.
Two months later, on a weekend earlier this month, a line snaked out the door of the Kate Spade store at the Woodbury Common outlet mall in Central Valley, NY, as shoppers jostled for deals.
On a Tuesday earnings call with analysts, Kate Spade Chief Executive Anna Bakst confirmed that the sales “reflected the strong and immediate heartfelt response from loyal customers to the tragic news of our founder’s passing.”
Still, Kate Spade comparable sales were down 3 percent during the quarter.
“It could have been down 5 percent,” if not for the outpouring of support from fans of the brand, said Johnson.
Tapestry, formerly known as Coach, bought the brand a year ago when it had been struggling to break out of a cycle of discounting and flash sales.
Tapestry Chief Executive Victor Luis said the brand’s fourth quarter results “exceeded our expectations from both a top- and bottom-line perspective, with both sales and operating margin increasing from reported prior year results.”