The insight: Tapestry and Ralph Lauren are building toward growth in an otherwise tepid luxury market.

• Tapestry expects mid-single-digit revenue growth in fiscal 2027 and 2028. Longer term, it aims to nearly double Coach into a $10 billion brand, up from $5.6 billion last year.
• Ralph Lauren also has its sights on becoming a $10 billion brand by decade’s end. Its latest forecast calls for mid-single-digit sales growth over the next three years—a target executives acknowledged as conservative but aligned with its goal of sustainable expansion.

The key points: Three principles support the companies’ ability to outperform in a difficult landscape.

A strong brand narrative. Both companies use storytelling to elevate their brands and build lasting consumer connections. David Lauren, Ralph Lauren’s chief branding officer, said “the new luxury” is defined not just by price but by meaning and resonance.

• For Ralph Lauren, that means selling not just products, but an entire lifestyle: one that evokes luxury as inclusive and accessible, and consequently encourages shoppers to become customers for life.
• Tapestry, meanwhile, positions itself as meeting consumers’ lifestyle needs while minimizing “deselection barriers” such as over-discounting or aggressive marketing that can repel shoppers.

Both are spending heavily to amplify these messages. Tapestry’s marketing budget has grown to 11% of sales from 4% in 2019, and will rise further to support Kate Spade’s recovery and sustain Coach’s momentum. Ralph Lauren plans to increase its annual marketing spend from 7% of sales to up to 8.5%.

A solid selection of core products. Ralph Lauren and Tapestry prioritize timeless products over fleeting trends, reducing markdowns and reinforcing their luxury positioning.

• Tapestry expects 80% of customer growth in the next three years to come from handbags and leather goods.
• Ralph Lauren has “one of the most powerful [portfolios] of core products” in the fashion industry, per CEO Patrice Louvet. These items are not only iconic but are wardrobe staples in perpetual demand—enabling price increases and product introductions at a higher price point.

An inclusive approach to luxury. While both are using their pricing power, they remain mindful of consumers’ value focus.

• For Tapestry, European rivals’ steep price hikes work to its advantage: A Coach bag is now 5 to 10 times cheaper than a comparable product from a European brand, positioning it as more accessible.
• Ralph Lauren’s tiered pricing allows customers to “trade down” within the brand, while its design credibility enables it to attract less price-sensitive shoppers.

Our take: Other luxury brands should take note. With pricing power waning, storytelling and product innovation are crucial for reengaging disaffected consumers. Tapestry and Ralph Lauren show that combining brand resonance, strong core products with a disciplined pricing strategy, and an inclusive approach to luxury can deliver sustainable growth in a challenging market.