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Business restructuring Tiffany
- 1. © Katharina Babczynski,Adrien Coquelin, Isabeau Haelterman, Varun Jagger, Etienne Martin, Ruchi Verma
- 2. Table of Contents PARTI I. History of Tiffany & Co. II. The Brand Concept III. Brand Elements, Prism & Platform IV. Target Consumer V. Luxury Watches Attributes VI. Luxury Watch Industry Analysis VII. Tiffany‘s Positioning in the Watch Market Positioning SWOT PESTEL Porter VIII.Argumentation PART II I. The New Tiffany & Co. Watch Concept & Strategy II. Positioning III. Segmentation & Objectives IV. 4 P‘s V. Conclusion 2
- 3. 1837 Costume Jewelry 1848 French crownjewels 1867 Silver sterling standard 1878 The Tiffany Diamond 1878 Tiffany Blue & Blue Book 1886 The Tiffany Setting 3
- 4. II. The BrandConcept For more than 175 years Tiffany & Co. has been creating the most glamorous jewels the world has ever seen, in the heart of New York City. Craftsmanship Exclusive gems Social responsibility 4
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- 6. Personality Culture Self image Physique Relationship Reflection Gemstones Silver Sterling Classic FifthAvenue Elegant Classy Sophisticated Feminine Manhattan Craftsmanship Social responsibility Romance Gifting Affluent Traditional Loved Fortunate Youthful Happy Reliable Accessible Tiffany experience (trained sales-force) 6
- 7. III. Brand Platform 7 Vision:Create precious jewelry pieces according to excellent craftsmanship and social responsibility Mission: Amazing and extraordinary pieces Personality: Chic & elegant woman (mother & daughter) with romantic touch Values: Unique, timeless (forever), quality Positioning: One-of-a-kind jewelry that is valuable through precious stones combined with gifting for romantic occasions (emotions) Target: Affluent independent female with sense of style - looking for their “Best friend”, Men as gift buyers for special occasions Ambition: Synonym (top of mind) for jewelry (especially for rings and jewels) Signature: Spirit of the successful New Yorker Upper East side woman
- 8. 25-50 years oldFemale & Male Focus on relationships, especially romantic (Engagement, wedding) Gift-Buyers / Gift-Receivers Affluent self-buyers Men as primary purchasers IV. Target Consumer 8
- 9. V. Luxury WatchAttributes • Marked by excellence in quality and craftsmanship that don’t just measure time but are based on long lasting values, evoke emotions by storytelling and enhanced with technical virtuosity and stylistic inventiveness Price Range : 3,000€ – 500,000€ + Craftsmanship Quality Know how Design Innovation Brand perception History / Tradition Swiss Made Precision Maison
- 10. VI. Luxury WatchIndustry Analysis Richemont SA led conglomerates with more than 13% growth of its watch brands (Cartier Ballon Bleu) 24% drop in global interest for Tiffany & Co. Watches Global Growth Rate 5.7% (2013) 7.5% for Women Led by China, India & Russia (+33%) Watch & Jewelry segment grew by 13% 10 Haute Horology was the fastest growing category in luxury +13,6%
- 11. VII. Tiffany’s Positioningin the Watch Market 11
- 12. VII. SWOT Strengths • Strongsourcing and manufacturing capabilities • Broad jewelry product range • Strong brand presence in direct selling ,US market • “Tiffany Experience” Weaknesses • Declining profitability • Weak retail presence in Latin America & Middle East • No watch making know- how/craftsmanship • Unsuccessful launches of watches Opportunities • 13% Growth rate for luxury jewelry & watch segment • Strong demand of women's watches • Working with independent watch maker to re-establish watches (Learning) • Increasing demand for luxury in the emerging markets (China) Threats • Fierce competition in luxury watch market (conglomerates & independents) • New entrants from designer apparel brands: Michael Kors, Gucci,...) • Intense competition pressurizes margins 12
- 13. Anti-corruption law inChina Overall growth of the watch market 5.7%; fluctuations in commodity pricing Importance of Social Media, Instagram (Not in top 15 brands, less than 1.7% of all searches) Digital multifunctional watches (Apple); Luxury watches rely less on technology and more on craftsmanship Extraction of jewels, raw materials, environmental concerns Swatch dispute ($450 Million USD of cost) 13
- 14. VII. Porter’s 5Forces Expansion of watch collections of other makers into our segment. Apple Watch, straight jewelry (bracelets). Suppliers of components being bought by large groups (Swatch) Conglomerates able to decide to whom they sell, in what quantities, and at what prices (selling power) Buying power of luxury consumers is growing, along with the overall number of luxury consumers Internet playing an increasingly important role (buyer choice, education) Luxury watches must be able to differentiate themselves from the competition, (technical expertise, design, pricing) Watches & Jewelry Segment New entrants Substitute products Rivalry among competitors Suppliers Buyers 14
- 15. VIII. Arguments Increase revenuesin a constantly growing segment Create Brand awareness in watch segment while cementing its position as a true competitor in the luxury watch market Putting a passion for design, diamonds and gems in perspective with growing desire for simplicity and classic elegance 15
- 16. Part II I. Thenew Tiffany & Co. watch concept & strategy II. Segmentation III. Positioning & Objectives IV. 4 P‘s i. Product ii. Price iii. Place iv. Promotion V. Conclusion 16
- 17. I. Concept Focus onTiffany’s DNA & Strengths Watches only for women Look like pieces of jewelry Created in 50-50 Joint Venture with a partner organization 17
- 18. • Leading groupin industry • House of brands managing successfully large portfolio • Current partner of Ralph Lauren • Large resources & knowledge to be shared • High horology & high jewelry expertise • Owns direct competitors of Tiffany (Cartier, VCA) • Wide range of price points • Lower possible start price for new collection • Higher risk of espionage • Probably no difference to customer when associated with • Recognized watch brand in luxury market (increases value of watches) • Old partner of Tiffany • High horology expertise • Lower risk of espionage • Already a partner of Chanel (successful women's watches in same segment) • Sales boost possible with AP brand on promotions • Smaller resources • Prices start at 6000€ with quartz • Higher start price for new Tiffany collection I. Concept Joint Venture 18
- 19. • Segmentation: Independentwomen who desire to feel special. Pamper themselves and are pampered by the spouse. • Quantitative: Outperform the watch market growth rate year- on-year • Qualitative: Become the most coveted watch brand for women II. Segmentation & Objectives 19
- 20. III. Tiffany‘s NewPositioning in the Watch Market Tiffany’s watch is the only mechanical women’s watch that combines excellence in watch craftsmanship with elegant jewelry design. 20
- 21. III. Tiffany‘s NewPositioning in the Watch Market 21
- 22. IV. 4 P’s:Product Tiffany T Collection Jewelry Collection Blue Book Collection 22
- 23. IV. 4 P’s:Product Tiffany T Collection Automatic COSC Movements 28-36mm Cases Stainless Steel Cases Stainless Steel and Suede bracelets Jewelry (diamonds or gold) 3.000€ - 10.000€ 23
- 24. Manual COSC movements Cases28-36mm Precious metal Cases Precious metal and leather bracelets Precious gems Prices: 10-000€ - 50.000€ IV. 4 P’s: Product Jewelry Collection 24
- 25. The Blue BookCollection Very limited editions Flagship products for the brand Precious materials Used to increase awareness Price > 300.000€ IV. 4 P’s: Product 25
- 26. IV. 4 P’s:Place Own Tiffany & Co. stores Online store, for the Tiffany T Collection 26
- 27. IV. 4 P’s:Promotion Objectives: increase awareness (buzz) and highlight the core values of the brand Above the line: Print, OOH (Caps) & TV ads 27
- 28. IV. 4 P’s:Promotion Below the line: Events (B2B, B2C): Kick-off New York (Red Carpet Event), Press “Breakfast at Tiffany” Watch Fairs: Baselworld, SIHH Sponsoring: Sports (Timekeeper), Olympic Games, Society Events Movie Product Placements 28
- 29. IV. 4 P’s:Promotion “Tiffany Hunt”: Tiny Tiffany boxes placed through big cities the night before the launch. Winner receives a Tiffany watch App competition: design a watch on the app and post on Instagram. Most ‘liked’ watch gets made and is gifted for Valentine’s Day Social Media: Videos, Pictures, exclusive insights Issued in magazines with ads. Allows users to visualize the watch on them https://www.youtube.com/watch?v=m9oeAlOY4Vs Social Media Augmente d Reality Guerilla
- 30. IV. 4 P’s:Promotion 30
- 31. V. Conclusion Based ongrowing watch market (especially women’s) we are launching a new collection Very design focused with strong links to Tiffany’s current collections to keep the core values and DNA of the brand Target gift-givers and self-buyers (same as Tiffany’s jewelry) Expanding in watch segment while combining jewelry as Tiffany’s Core value with watch attributes (USP) Partnering with a very experienced group in the market to get the know-how and experience of watch-making Resources for jewelry (watches) taken from Tiffany’s experience in precious stones 31
- 32. Thank you foryour attention! 32
Editor's Notes
- #4 Costume jewelry Crown jewels Silver sterling standard The yellow Tiffany diamond The blue book Engagement Ring „tiffany setting“
- #5 New York Craftsmanhsip Coloured stones, glamorous jewels One of a kind pieces Social & environmental responsible Prices & Products
- #15 New Entrants Expansion of watch collections of other makers into our segment. Substitute Products Apple Watch, straight jewelry (bracelets). Bargaining Power of Suppliers Suppliers of components being bought by large groups (LVMH, etc.) Conglomerates able to decide to whom they sell, in what quantities, and at what prices Rivalry among competitors Watches & Jewelry Segment Bargaining Power of Buyers Buying power of luxury consumers is growing, along with the overall number of luxury consumers Internet playing an increasingly important role (buyer choice, education) Luxury watches must be able to differentiate themselves from the competition, (technical expertise, design, pricing)