How Coach Got Knocked Off

Editor's note: This column was submitted by Stockpickr member Susanne Owen, also known as the Trading Nymph.

Teacher, Teacher, pick me, pick me ... I know what happened to the Coach(COH Quote - Cramer on COH - Stock Picks).

No, he is not in the teachers' lounge. He went to the swap meet. Yes, Coach seems to be at all the swap meets and small tourist shops everywhere. But wait -- that isn't the famous CC logo. It's GC. Oh, you mean they are all fakes? Who could tell? That would explain the $25 sale price. I thought it was just a really great deal.

Knock-offs have always been around. But why are they hitting Coach and some other companies so hard? First, it may cut into the bottom line. But really, how many people shop at swap meets one day and Coach stores the next?

What really may be happening is that fake Coaches are popping up everywhere because everyone wants to feel rich even though they cannot afford it. The people who are willing to pay $500 for a handbag are seeing their bags on the shoulders of 13-year-olds waiting for the bus. The Coach buyer comes to the sad reality that she is no longer special or better than anyone else by carrying this purse.

But I can hear you out there saying, "Wait -- fake Rolexes!" But there's an important difference. If you walk in any mall, you can easily tally up the number of fake Coaches -- and if you shelled out big bucks for the real thing, you're gonna be annoyed and you might not buy another one the next time around. The brand has suddenly lost its allure.

On the other hand, it is very hard to notice if someone's wearing a fake Rolex, so you're less likely to be annoyed if you shelled out big bucks for the real thing.

So Coach is a victim of imitation, which in this case may not be the best form of flattery. Even eBay has a warning on its site about OEM factories that specialize in selling exact reproductions of the original. In addition, Coach may not be helping its image much by having its shoes at Ross Stores or so many Coach outlet stores with plans to open more.

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