Who's competing with Coach Coach most likely lost sales to companies like Michael Kors , or to discounters like The TJX Companies, Inc. (NYSE:TJX) . Kors grew at a fantastic rate throughout all of 2012, and reported last quarter that comparable sales increased by 45% in North America. Since that brand hits higher cost points than most, customers probably also found their way to TJX discount brand T.J. Maxx. Over December, the company increased comparable sales by 6%, due to strong foot traffic. The same traffic that Coach was lacking.

While this is a real setback for Coach, it's probably not the end of the world. To me, it reinforces the lesson I learned: It's easy to overlook the things that seem to be going well. Hopefully, this will act as a wake-up call for Coach, Inc. (NYSE:COH), as it has for me. If the company wants to hold on to its market share, it needs to have a plan in place for its core customers.

Investors still bullish about Coach's long-term performance can see today as a valuable lesson, and a chance to pick up some discounted shares. At midday, the stock was trading well below the apparel industry's average P/E at just 14 times earnings. It looks like Coach has entered a promotional environment after all.

Michael Kors is one of today's hottest high-end fashion brands, and that's translated into one of the bes-performing stocks in retail -- since its debut on the market in late 2011, the share price has more than doubled. But with all that growth, has the stock finally become too expensive, or is there still room left to run? The Motley Fool's new premium report on Michael Kors gives investors all the information they need to make the right decision. We cover the key must-watch areas, opportunities, and threats to the company that investors need to know. To claim your copy, simply click here now for instant access.

The article Learning a Timely Lesson From Coach originally appeared on Fool.com.

Fool contributor Andrew Marder has no position in any stocks mentioned. The Motley Fool recommends Coach. The Motley Fool owns shares of Coach. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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