Tiffany & Co. is a holding company that operates through its subsidiary companies (“company”). The company’s principal subsidiary, Tiffany and Company, is a jeweler and specialty retailer, whose merchandise offerings include an extensive selection of jewelry, as well as timepieces, sterling silverware,

china, crystal, stationery, fragrances and accessories. Through Tiffany and Company and other subsidiaries, the company is engaged in product design, manufacturing and retailing activities.

Tiffany was founded on September 18, 1837 when Charles Lewis Tiffany opened a stationery and fancy goods emporium at 259 Broadway in New York City. Every article was marketed with a non-negotiable selling price, a revolutionary policy that made headlines.

The first day’s store sales were total five dollars in downtown Manhattan. Soon after the company was founded a distinctive shade of blue was chosen to symbolize the company’s renowned reputation for quality and craftsmanship.

Tiffany as a Brand:

The company adopted the color for it’s for use of boxes, catalogues, shopping bags, brochures, as well as advertising and for other promotional materials. Over time, this lustrous color became an identify mark for Tiffany & Co., universally recognizable as the Tiffany blue. Tiffany blue boxes and shopping bags evoke images of elegance and exclusivity, as well as lush bounty. The Tiffany blue box was later to become an American icon of style and sophistication.

Distribution of Tiffany & Co:

The company’s channels of distribution are through: U.S. retail (50% of fiscal 2006 sales) consists of retail sales transacted in Tiffany & Co. stores in the United States and sales of Tiffany & Co. products through business to business direct selling operations in the United States; International Retail (38% of fiscal 2006 sales) consists of sales in Tiffany & Co. stores and department store boutiques outside the United States and, to a lesser extent, business- to-business, internet and wholesale sales of Tiffany & Co. products outside the United States.

Direct marketing (seven per cent of fiscal 2006 sales) consists of Internet and catalog sales of Tiffany & Co. products in the United States; and others (five per cent of fiscal 2006 sales) consists of worldwide sales of businesses operated under trademarks or trade names other than Tiffany & Co. (i.e., Little Switzerland and Iridesse). Others also include wholesale sales of diamonds obtained through bulk purchases that are

subsequently deemed not suitable for Tiffany’s needs.

Growth Strategies Adopted by Tiffany & Co:

The company’s key growth strategies are to selectively expand its channels of distribution in important markets around the world without compromising the long-term value of the Tiffany & Co. trademark; to increase sales in existing stores by developing new products; to increase its control over product supply and achieve improved profit margins through direct diamond sourcing and internal jewelry manufacturing; to enhance customer awareness through marketing and public relation programs; and to provide customer service that ensures a superior shopping experience.

The company’s shares are traded on The New York Stock Exchange with the symbol TIF. Headquartered at

727 Fifth Avenue in New York, Tiffany has more than 8,000 employees around the world.

Smaller Format:

Tiffany & Co. announced plans to open a smaller-format store in Glendale, California, in mid-October 2008. The approximately 2,600 sq. ft. store was to be located in The Americana at Brand, a new 900,000 sq. ft. retail and residential environment developed by Caruso Affiliated.

Covering 15.5 acres that’s beautifully landscaped with fountains, plazas and walkways, the expansive property is designed as an ultimate lifestyle and leisure destination, with shops and boutiques, casual cafes, fine dining, and luxury residences.

The store’s clean, ultra-modern environment invites relaxed browsing and interaction with contemporary Tiffany & Co. collections, ranging from diamond jewelry in platinum and gold to an array of sterling silver jewelry.

“We are pleased to be the first retail environment in the world to unveil this new concept shop by Tiffany & Co.” stated Rick J. Caruso, CEO of Caruso Affiliated. “Rich in history and true luxury, Tiffany & Co. is simply the finest purveyor of diamonds, jewelry and gift items.”

Tiffany & Co. (NYSE: TIF) reported results for the three months (“second quarter”) and six months (“first half”) that ended on July 31, 2008. Strong net sales growth in Asia- Pacific and Europe led to an 11% increase in worldwide net sales in the second quarter.

Combined with a higher operating margin, this resulted in a 21% increase in net earnings from continuing operations and a 31% increase in earnings per diluted share in the quarter. These results enabled the company to slightly increase its earnings expectation for the full year.

Net sales in the second quarter increased 11% to $732.4 million. On a constant-exchange-rate basis which excludes the effect of translating foreign-currency-denominated sales into U.S. dollars (see attached “Non- GAAP Measures” schedule), worldwide net sales rose to seven per cent and comparable store sales declined one per cent. In the first half, net sales rose 11% to $1.40 billion. On a constant-exchange-rate basis, sales increased seven per cent and comparable store sales rose one per cent.

Promotion Strategies Used by Tiffany & Co:

The world has been infatuated with the Tiffany style since the early twentieth century. From Hollywood premieres to Centre Court at Wimbledon, celebrities choose Tiffany for its urban sophistication and glamor. Design that is innovative, unique and stunningly beautiful is, by definition, irresistible.

For this very reason, Tiffany’s timeless jewelry pieces are seen prominently on the world’s most beautiful people. Movie stars, fashion models and women of achievement embrace Tiffany’s spectacular beauty and superlative craftsmanship.

Tiffany plans to enter into Indian market because of the ideal growth prospects. The Indian jewelry sector, one of strongest retail segments of India, has an estimated total domestic market size of Rs. 52,000 crore. The organized jewelry retail sector accounts for just about three per cent of the total market size at Rs.

1,450 crore.

While the overall jewelry retail sector has grown by 9.2% in 2006 over the Rs. 47,600 crore market in 2005, the organized segment has shown a nearly 32% growth in 2006 over the Rs. 1,100 crore organized market in 2005. The share of organized jewelry retail has grown from two per cent in 2004 to nearly three per cent over the two-year period. The Indian jewelry sector’s current global standing is estimated at over US $90 billion.

According to industry sources, in India 65% of the jewelry is bought during weddings, with gifting contributing around 26%. Global players will look to establishing a foothold in this market in view of the sheer size of the domestic market and because India’s expertise in the trade is well recognized across the globe.

Competitors of Tiffany & Co:

An analysis of some of the major organized jewelry retailers indicates that in terms of increase in retail outlets there was equal growth (39%) in 2005 and 2006 whereas the growth in retail space was more in 2005 than in 2006.

1. Tanishq:

Tanishq, from the Tata Group, was started in 1995 and is one of the most diversified business conglomerates. Ten years ago it challenged the established family jeweler and introduced new rules in the precious jewelry segment.

Tanishq marked the beginning of jewelry chains in the country, as against the single store norm of the category traditionally. It has witnessed steady growth over the last two years. From a retail presence in 55 cities with 69 stores across 1,01,290 sq.ft. of retail space in 2004-05, it currently has 92 stores across the cities.

2. D’Damas:

In 2003, the Gitanjali Group and Damas LLC Dubai — the largest jewelry retail chain in the Middle East came together to form D’damas — a contemporary collection of gold and diamond jewelry. D’Damas’ gold jewelry is endorsed by the World Gold Council (WGC) and its diamond brands by DTC. Some of the most successful brands of the group are Gili, D’damas, Giantti and Sangini diamond Jewelry.

3. Orra:

It owns 20 standalone stores across 15 cities in India. A part of the Rosy-blue Group, it has metamorphosed into a brilliant entity. Today, the group has cast its glow over 14 countries across the globe and is among

the largest sight holders and India’s largest diamond and platinum retailer.

4. Intergold:

Intergold, another rentuse from the Rosyblue Group, was started in 1996, and works in close association with DTC (De Beers), World Gold Council and Platinum Guild International. It the one of the largest diamond jewelry retail chain in India with over 20 stores across India.

5. Carbon:

Carbon has two exclusive stores, one each in Bangalore and Delhi. Since its launch in 1998, it is also present in 58 shop-in-shop formats. By 2007 end, Carbon planned to have 20 stores across India.

Assignment: (200 words/PDF) answer the following questions.

Tiffany is not only seeing increased competition on a global scale but also with online sales growing with companies like BlueNile.com and others. Yet retail sales stills tend to be the strongest sales generator for Tiffany because of its customer service and exclusive lines.

1. Based on your experience and research what would you recommend Tiffany focus on for 2021 using an omnichannel approach?

2. Although the Tiffany in-store experience is “formal/professional” some retailing consultants are recommending Tiffany shifts to an “experience retailing” model, because of the changing desires of consumers who have gone more casual. What are your recommendations? Should they keep what has worked for almost 100 years or should they shift?

Answer rating: 100% (QA)

What is Tiffany Co and what are its products and ... View the full answer