MIchael Kors Digital Transformation Strategy

of one

MIchael Kors Digital Transformation Strategy

Key Takeaways:

  • Founded in 1981, Michael Kors offers a variety of luxury products, including men's wear, women's wear, watches, jewelry, eyewear, footwear, wearable technology, accessories, and a fragrance line.
  • In the fiscal year ending April 2022, Michael Kors accounted for $3.95 billion of Capri Holdings' revenue of $5.65 billion.
  • Michael Kors' challenges include supply chain disruptions and a lack of suitable leadership.


This report provides an analysis of Michael Kors, including a brief overview of the company, its mission, and values, as well as details of its digital transformation. Information on the challenges faced by the company has also been provided, However, older sources were used to provide an overview of its digital transformation journey as well as quotes from executives.

More details on the logic can be found in the Research Strategy section.

Summary of Findings


  • Michael Kors was founded in 1981 by fashion designer Michael Kors. The company offers a variety of luxury products, including men's wear, women's wear, watches, jewelry, eyewear, footwear, wearable technology, accessories, and a fragrance line. Its stores are either operated directly or via licensing partners.
  • In November 2017, Michael Kors acquired the footwear brand, Jimmy Choo for $1.2 billion. It also acquired Versace in September 2018 for $2.1 billion and soon after renamed itself Capri Holdings effective January 2, 2019.
  • In the fiscal year ending April 2022, Michael Kors accounted for $3.95 billion of Capri Holdings' revenue of $5.65 billion.

Mission and Values

  • Michael Kor's mission is to offer a "sophisticated jet-set lifestyle" to men and women globally.
  • The brand states that its values are "preserving the integrity of its iconic fashion brands with every customer interaction;" continuously growing its community and inspiring team members globally; and encouraging curiosity, innovation, and creativity.

Marketing Technology Stack

  • Yext, Instagram Advertising, Facebook for Business, Hootsuite, Oracle Responsys Interact, and Dynamic Yield are listed among Michael Kors' marketing technologies on Slintel.
  • Wappalyzer reports that Criteo, Teads, Twitter Ads, Taboola, and Microsoft Advertising are among the marketing technologies used by Kors.
  • SiteScore adds that Nativo, Revcontent, Bidtellect, and Outbrain are used by the brand for native advertising, while Bing Ads and Google Ads complement Yext in search advertising. Also, Pinterest Business is used alongside Facebook Ads for social advertising.

Strategic Initiatives and Quotes

  • A 2018 article attributed Michael Kors' strong performance to its digital efforts. The company began prioritizing social media marketing, including influencer marketing, in 2017. As of 2019, the brand was leading its competitors in social media engagement statistics.
  • In 2017, Michael Kors CEO said, "Social media is a cornerstone of our communications efforts and remains a principal focus in deepening our connection with consumers."
  • In 2018, during a conference call with investors, John Idol said, "The greatest level of traffic growth for the company is clearly online. Let's take a closer look at three crucial parts of Michael Kors' holistic digital strategy -- all of which have helped spur growth and revive hope in the company's long-term prospects."
  • In 2018, Michael Kors tapped Aptos for the Aptos ONE platform that allowed "customer transactions to be processed anywhere on locally resilient mobile devices without the need for costly store servers." Then CIO said, "When Michael Kors is evaluating technology investments, we ask ourselves if the potential innovations will improve the experience for our customers and our associates, and if it will empower our business to better adapt to change."
  • In July 2019, the brand launched a digital flagship store on Alibaba's Tmall platform that caters to premium and luxury brands. The store provided Tmall customers with access to products launched exclusively on Tmall. During the launch, John Doll said, "We are excited to launch our new Michael Kors digital flagship on Tmall and Tmall’s Luxury Pavilion. Consumers are becoming more digitally engaged with luxury shopping in China and Tmall Luxury Pavilion is the perfect venue for us to communicate Michael Kors’ brand vision."
  • In April 2020, Michael Kors launched a customization service named "MK My Way" for its handbag range. The service allowed customers to receive product suggestions from designer Michael Kors after taking a personality quiz. Customers could then add hand-painted customizations to the bags. The brand also achieved engagement through teaser videos and live streams during the pandemic.
  • In 2021, Michael Kors leveraged "Tmall’s Flagship Store 2.0 solution" to enhance engagement through storytelling. In addition to digital pop-ups, the brand released several short videos and live streams featuring celebrities on the platform as well as offering product recommendations. Designer Michael Kors said, "I love meeting my customers, helping them find the perfect pieces for their lifestyle, and talking to them about how they can express their personal style. The Tmall app allows me to instantly style a wide range of people. It’s like a trunk show for modern times."
  • On September 8, 2022, "the Council of Fashion Designers of America (CFDA)" partnered with The Sandbox Metaverse for a fashion exhibition to celebrate the former's 60th anniversary. Designer Michael Kors will be among the designers who will create exclusive NFTs to be sold at the event.

Additional Information

  • There are 524, 301, and 2,742 Michael Kors retail stores, outlet stores, and wholesale locations located in the Americas and parts of Europe, Asia, and EMEA. Its e-commerce business is limited to Canada, the U.S., Asia, and EMEA.
  • According to Capri Holdings' 2022 annual report, its company wide marketing campaigns are increasingly leveraging social media and digital platforms to enhance engagement with younger customers. The company spent about $329 million on marketing and advertising in fiscal 2022.
  • Also, Michael Kors introduces new collections semi-annually with fashion shows, which generates extensive international and domestic social media and media coverage.

Michael Kors Challenges

Supply Chain Disruptions

  • According to Capri's 2022 annual report, the effects of COVID-19 are still affecting the supply chain partners of its brands, including Michael Kors. The global labor and transportation shortages as well as port congestion and factory production disruptions in source countries have led to delays and will continue delaying inventory orders, which impacts the company's ability to avail products to both physical and online customers.
  • The supply chain disruptions have lowered the inventory levels of its brands and, consequentially, negatively impacted net revenues. The disruptions have also caused the company to increase the use of increasingly expensive freight services. The extra freight costs coupled with increased prices of components have forced the companies in Capri's portfolio to increase prices with the possibility of further increases in the future, which may not be acceptable to consumers.

Impact on Michael Kors

  • In 2021, Capri's CEO John Idol told analysts in a conference call that Michael Kors was negatively impacted by the supply chain disruptions that were caused by shutdowns of Vietnam factories, congestion outside ports, and lack of truck drivers.
  • He also added that Michael Kors was experiencing the "biggest inventory issue" among Capri's brands and that its challenges were global and not limited to North America. The disruptions added 45 to 60 days to its delivery timeline globally.
  • In August 2022, John Idol reiterated his sentiments in a conference call with investors acknowledging that the supply chain disruptions were still affecting the company. While sales rose for Michael Kors and other Capri brands in the first quarter of 2023, the disruptions will likely eat into the brand's profit in the second quarter. Additionally, Capri's shares dropped by 5% in 2022 due to these challenges.

Why This is a Challenge

  • This is considered a challenge because it has been mentioned severally as one by the company's CEO and in the most recent annual report, and it is affecting the company's operations, market position, and profit margins.

Leadership Challenges

  • In its 2022 annual report, Capri reported that its success is dependent on having experienced executive officers and the ability to retain and attract qualified employees. Therefore, the exit of key employees such as former Michael kors' CEO Joshua Schulman had adverse effects on the company. It also admitted that its ability to retain qualified employees may be further impacted by the intense competition for labor in the fashion industry as well as aggressive tactics that may be used by competitors to recruit its employees.
  • In March 2022, Joshua Schulman left the company forcing John Idol to stay on. He had served as Michael Kors' CEO since August 2021 and was being prepared to take over as Capri's CEO in August 2022. John Schulman was viewed as the ideal candidate since he had resolved Coach's past struggles with brand degradation and discounts, which Michael Kors currently faces.

Impact on Michael Kors

  • Despite CEO John Idol's assurances that the leadership at Michael Kors was still well positioned to execute the brand's strategic initiatives, Capri's shares dropped by 15%. Also, the departure of Joshua Schulman, who had a vast experience in luxury fashion, affected Capri's efforts to move Michael Kors' into the higher-end realm. The brand was working to get into the luxury market where margins are higher after struggling in previous years.
  • Michael Kors is currently managed by a group of executives who report to Idol since Capri is yet to appoint a CEO for Michael Kors.

Why This is a Challenge

  • This is a challenge because it has been identified as a risk factor in Capri's 2022 annual report. It also affected the company's share price and disrupted its planned strategic initiatives.

Research Strategy

To provide a company analysis for Michael Kors, we began by searching through the company's website and annual report. This strategy provided an overview of the company as well as its mission and values. We leveraged third-party resources such as Slintel and SiteScore to identify its marketing technology stack. The research team expanded its search to the public domain to find information on the company's digital transformation and quotes from the CEO. However, we could not find this information pre-compiled and we had to use some older sources to provide an overview of the company's digital transformation journey. Moreover, our quest for more recent quotes from the CEO or company executives was fruitless. For this, we also identified Capri's and Michael Kors' executives and then conducted a targeted search to determine if any of them had made any comments recently. We only found a statement by the brand's designer made in 2021.

To provide information on the corporate challenges faced by Michael Kors, we leveraged Capri's 2022 annual report as well as credible media resources such as Vogue Business, Retail Dive, and CNBC.

Did this report spark your curiosity?