The news: Tapestry boosted marketing spending by roughly 50% YoY in FYQ3—with the Coach brand alone approaching $1 billion annually—as the company shifts more budget toward top-of-funnel brand building. That investment is paying off. The company added more than 2.4 million new customers globally, roughly 35% of whom were Gen Z.

Coach’s sales rose 29% YoY on a constant basis to $1.70 billion, with strong growth across its key regions: Greater China rose 58%, while North America and Europe each grew 27%.

Excluding Stuart Weitzman, which Tapestry sold last year, group sales in its Q3 ended March 28 increased 23% YoY, gross profit rose 22%, and gross margin expanded from 76.1% to 76.9%.

The strategy: “Our methodology to marketing is different and rare, and it’s working,” said Coach CEO and brand president Todd Kahn. Rather than focusing on product-first selling, the brand builds campaigns around consumer insights and storytelling.

Coach’s Spring 2026 "Explore Your Story" campaign offers a clear example of that approach. It targets Gen Z’s interest in long-form storytelling as self-expression, positioning the Tabby bag as a centerpiece of campaign content and pairing it with book-themed charms to emphasize individuality. The campaign also leans on partnerships with Gen Z-led communities and cultural platforms, along with experiential activations, to embed the brand in broader cultural conversations.

The challenge: While Coach continues to outperform, Tapestry’s other brand, Kate Spade, remains under pressure, with revenues falling 11% to $219.6 million. However, the brand managed to add about 400,000 new customers during the quarter.

Implications for marketers: Coach’s results show that aggressive marketing spending can pay off if it translates into meaningful customer acquisition. Adding millions of new customers, particularly Gen Z and Gen Alpha, expands the brand’s long-term revenue base and creates the potential for significant lifetime value as those shoppers move into their peak spending years.

That momentum can also fuel category expansion. Coach grew footwear sales roughly 20% during the quarter, which shows how early acquisition can extend beyond a single purchase. By bringing customers in early, the brand has an opportunity to deepen relationships and capture a larger share of wallet over time.

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