The purse company stays alive by offering cheaper bags.

Coach was founded in 1941 as a leather-goods workshop based in Manhattan. A few years later, employee Miles Cahn took over operations and, in 1961, bought the business. Cahn hired designer Bonnie Cashin, the early creator and popularizer of American sportswear who invented the shoulder bag and clutch purse with removable shoulder straps. Cashin, whose influence at Coach endures, introduced brass and metal buckles, toggles and clasps, piping and leather trim to American women, who still wore lined purses that closed with buttons.

The fate of Coach changed in 1979 when Cahn hired Lew Frankfort, a former New York City agency head to run new-business development. The company, sold to the Sara Lee Corp. (SLE) in 1985, remained a sleepy brand until 1995, when Frankfort was appointed chairman and CEO. Frankfort lured Reed Krakoff, a 32-year-old Parsons School of Design graduate and Weston, Conn., native, from his chief marketing officer perch at Tommy Hilfiger. Krakoff, who had also worked at Ralph Lauren, was offered total creative control. Together, Frankfort and Krakoff revolutionized Coach.

Frankfort's $9.6 million total compensation pales in comparison to Krakoff's $22 million, which is unparalleled for a designer who didn't start his own shop. But Krakoff's marketing genius, combined with his design sensibility, has played a pivotal role in propelling the brand to marvel status. While most retailers release new lines semi-annually and perhaps quarterly, Coach flows "newness," to use industry parlance, every few weeks, a nod to the company's entrepreneurial, business-driven culture. "It's not, ‘We're a luxury brand this the way we do it,' " said Slater. "Most luxury brands have a snotty attitude toward their customers. If you want a Birkin bag, you have to wait on line for two months unless you're Cameron Diaz. Coach appreciates their customer more."

Like most big luxury brands, Coach is fighting overexposure and consumer fatigue. According to Dana Thomas, author of Deluxe: How Luxury Lost Its Luster, the brand is watered down, in part because it is beholden to its growth strategy. "You have to keep that going somehow with new ideas, new marketing, and new consumer targets. They've sold to above-40s, above-30s and above-25s, the Japanese, and now the 16-25s. It's what Giorgio Armani did with A|X and what Ralph Lauren did with Polo Sport," she said.

Indeed, Krakoff is a grand synthesizer and repackager. If you look more closely at the Poppy line, its influence extends beyond Juicy, paying homage to some of the most revered designers of our time: Pucci, Lilly Pulitzer, Fendi, Tod's, even Gucci. Coach's accessible luxury is democratized elitism even down to its amalgamated design aesthetic.

Once the cornflakes of handbags, Coach is now the everything of handbags, a quintessential American brand with little innovation that offers legions instant status for just a few hundred bucks. Coach has left behind its durable cachet in favor of everyman cachet or, as TBM columnist Mark Gimein calls it, the fat middle. In other words, Coach is what everyone else is, only cheaper.