For the second quarter of fiscal 2016, the brand announced poor results in the US.
In North America, comparable sales declined 4% and overall brand sales dipped 7%. Internationally, overall brand sales increased by 4%.
According to a recent study executed by Goldman Sachs and Teen Vogue, most brands that design accessible luxury handbags are "falling flat," and becoming less and less appealing to so-called "it girls," ages 13-29.
Coach, in particular, is a victim of this trend. According to Goldman Sachs' report, it's the most "well-owned" brand among it girls, followed by Michael Kors bags, meaning that it is more widely available, and therefore, less exclusive.
"In our view, while Coach is far from being a completely broken brand it remains in transition,"Håkon Helgesen,
"Admittedly, with Coach's restructuring efforts and its attempts to move away from excessive discounting, some deterioration to the topline is to be expected," Helgesen wrote.
Overall, the handbag industry is dim in comparison to other industries. More of the cool young women polled by Goldman Sachs and Teen Vogue preferred to spend their money on athletic wear brands and beauty companies.
Teens and young people, for the most part, prefer to not spend their money on luxurious items, and moreover, they don't even want fancy gifts. Even wealthy teens prefer practicality over luxury.
"While the more affluent Gen Z might request luxury item gifts, most of Gen Z wants a very different kind of luxury item today. If Gen Z wants a luxury item, it's going to be more practical than jewelry from Tiffany or an old traditional brand," Gen Z expert Nancy Nessel told Business Insider in an email.
This massive shift in spending has effected other luxury brands, such as Tiffany & Co., which saw sales take a nosedive over the holiday season.