1. Explain market segmentation and product positioning as a strategy-implementation tool for Tiffany & Company.
2. Discuss the nature of Tiffany's financial position in strategy implementation.

Tiffany & Company (TIF) 2015 Case

Headquartered in New York City, Tiffany is a jeweler and specialty retailer that manufactures and sells an extensive offering of jewelry, timepieces, sterling silverware, china, crystal, stationery, fragrances, and accessories. Tiffany employs 10,600 employees worldwide. As of December 31, 2014, Tiffany operated 296 stores (123 in the Americas, 73 in Asia-Pacific, 56 in Japan, 38 in Europe, 5 in the United Arab Emirates, and 1 in Russia) versus 286 stores (121 in the Americas, 69 in Asia-Pacific, 54 in Japan, 37 in Europe, and 5 in the United Arab Emirates) on December 31, 2013.

The Tiffany name conjures a vision of a tiny blue box topped with a perfect white bow. Inside is a Tiffany diamond, a sight that brings exquisite delight, romance, and a sparkle in the eyes of the beholder. To the discernable eye, the Tiffany blue box holds unparalleled quality and luxury. But to many others, the price of a Tiffany diamond is exorbitant, and a look-alike diamond can bring just as much happiness at a fraction of the cost.

In January 2015, Tiffany reported its sales for the two-month holiday period ending December 31, 2014. Worldwide net sales of $1.02 billion were 1 percent below the prior year. In terms of regional performance, Asia-Pacific reported sales growth of 10 percent, led by China and Singapore where sales increased 7 percent to $210 million. Tiffany's sales in Japan for the period declined 16 percent to $113 million and the company's European sales rose 1 percent to $133 million. The company's Americas declined 1 percent to $544 million, while the company's "Other sales" rose 14 percent to $24 million, led by Tiffany's new store in Moscow.

For the first quarter of Tiffany's fiscal 2015 that ended April 30, 2015, company sales dropped 5 percent year-over-year, led down by a 30 percent drop in sales in Japan to $122 million. In Tiffany's Asia-Pacific region, Q1 sales declined 1 percent to $259 million, but in other regions, sales decreased a disturbing 6 percent to $35 million. The company's Q1 sales in the Americas grew 1 percent to $444 million, but that too was disappointing since the company generates more than half of its revenues from this region. To combat its weak global performance, Tiffany is expanding its distribution network by adding stores in both new and existing markets. The company is opening smaller stores that offer selected collections of lower priced higher-margin product, which in turn boosts store productivity. In addition, Tiffany is putting more emphasis on improving sales per square foot by increasing customer traffic through targeted advertising, sales training and customer-oriented initiatives.