Tiffany&#039s & Co Marketing Audit

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Austin Casillas

Marketing 305

Professor Rizkallah

March 23, 2017

Tiffany Co.

Part 1: The Marketing Environment

A. Markets

Tiffany & Co. found in 3 continents on the world; North America, Europe, and Asia.

The United States currently has 38 stores. Throughout the continents, the Tiffany

stores and boutiques are mostly located in upper-class cities. Tiffany & Co major

markets and publics are white-collar adult males and females of all ethnic groups and

religions with elastic incomes to invest on a luxury item that will last a lifetime.

There are several segment that Tiffany & Co. break down and target. One way they

do this is by making a segment group of the customers’ nationality, gender,

engagement and wedding anniversaries, child births, and other celebrations. When it

comes to nationality, Tiffany uses the strategy of using famous Chinese models in the

commercials and prints in the attempt to reach out to the prospective customers who

can relate themselves to the models. For gender Tiffany & Co has a selection for male

and female that also have flexible price ranges for many potential buyers. Another

segment if for people who are preparing to propose (which is the most popular

segment) which is why they have professionals who help consumers make one of the

most important choices in their life. For couples who are expecting or have recently

given birth; they have a collection of items that are made specially to capture the

moment of life giving. And Lastly Tiffany & Co. breaks down into the psychographic

which is based on the lifestyle, tastes, personalities, and social class.

Management regularly evaluates potential markets for new TIFFANY & CO. stores

with a view to the demographics of the area to be served, consumer demand and the

proximity of other luxury brands and existing TIFFANY & CO. locations.

Management recognizes that over-saturation of any market could diminish the

distinctive appeal of the Brand, but believes that there are a significant number of

opportunities remaining in new and existing markets that will meet the requirements

for a TIFFANY & CO. location in the future. As part of its long-term strategy to open

additional stores, management plans to add 13 Company-operated stores and close

four existing stores in 2014: opening four in the Americas, five in Asia-Pacific, two in

Japan, and one each in Europe and Russia, while closing one each in the Americas,

Asia-Pacific, Japan and the U.A.E. The Company currently operates e-commerce

enabled websites in 13 countries. Sales transacted on those websites accounted for

6% of worldwide net sales in 2013, 2012 and 2011. The Company periodically

invests in enhancing these websites and intends to expand its e-commerce sites to

additional countries in the future. (“SEC Form 10-K”. U.S. Securities and Exchange

Commission. 2014-01-31. Retrieved 2017-3-3.)

B. Customers

When customers shop at Tiffany’s they know exactly what they are getting

themselves into and know that they will be purchasing the best of the best. The

signature blue box with the white ribbon that seals the gift represents much more than

the jewelry inside. It’s a symbol of the quality, service and emotional experience that

capture the customers’ loyalty. For customers who use their products continuously,

Tiffany’s provides a lifelong cleaning service, checkups, and repairs for their jewelry.

The Company understands that selecting an engagement ring is one of the biggest

decisions of your life so they rise to the occasions and to be the best. With stricter

diamond standards, ethical service, life time warranty, and the promise that “We will

always be there for you” earns the trust and loyalty of customers

For the present and expected future state of customers’ needs from this company

really is not much change for their older and more loyal customers, but for their

younger audience they seem to be taking a turn in the wrong direction. CEO of

consulting firm Conlumimo Neil Saunders wrote “While Tiffany still has a strong

brand, it is notable that the brand resonates most with affluent older shoppers. Among

affluent younger shoppers the brand is not viewed negatively but is seen as

representing ‘old world luxury’ which does not entirely chime with their lifestyles and

values. This means Tiffany often loses out among this important, and growing,

group.” (Schlossberg, Mallory. “Teens Are Experiencing a Major Attitude Shift, and

It’s Destroying Tiffany.” Business Insider. Business Insider, 18 Mar. 2016. Web. 20

Mar. 2017.) In the future Tiffany’s really wants to secure and establish something for

the younger market and if they can’t find something that will work, there is the

chance of them taking some product lines out.

C. Competitors

The Company’s major competitors are Cartier, BVLGARI, Harry Winston, Chopard,

Fred Leighton, Michael Katz. All of these companies including Tiffany’s are higher

end luxury products that target a market of wealthy and established customers.

For trends that could be seen with the competition with these other luxury brands

really comes down to the company. Tiffany’s net profit margin of 11.4% in fiscal

2015, ended January 31, 2015, is on the higher side among its peers in the jewelry

industry (XRT), including Signet Jewelers and Fossil .Being a luxury brand, Tiffany

does not believe in pricing-related promotions. An introduction of more silver items

and fashion jewelry helps to attract more profit for the company. Tiffany is well-

known for its sterling silver jewelry. Along with geographic expansion, Tiffany is

focused on broadening its assortments of silver and fashion jewelry. The company is

also looking beyond jewelry with its luxury watch collection. Tiffany exited the

watch business in 2011 after controversy with its joint venture partner The Swatch

Group. In April 2015, the company launched its vintage-inspired CT60 watch

collection, considering the growth opportunities in the global luxury timepiece market

worth $27.8 billion. (Diana Key | Dec 9, 2015 1:08 Am EDT. “Weighing Tiffany’s

Strengths and Opportunities.” Weighing Tiffany’s Strengths and Opportunities –

Market Realist. N.p., n.d. Web. 21 Mar. 2017.)

D. Macro Environment

The main developments when it comes to the demography, economy, technology, and

culture are top of the line and best in class when it comes to Tiffany’s. The culture of

being to best and most well known in the business helps establish the face and pride

of this company. With growing technology and being able to take material resources

and craft them into one of a kind prized diamonds is what makes Tiffany’s so great.

They are able to relate to their market on many levels and have been very successful

for many years.

Part II: The Marketing System Review

The Tiffany & Co. brand is the single most important asset of Tiffany. The strength of the

brand goes beyond trademark rights and is inherent in consumer perceptions of the brand.

Tiffany’s management monitors the strength of the brand through focus groups and

survey research. Tiffany’s management believes that consumers associate the brand with

high-quality gemstone jewelry, particularly diamond jewelry; excellent customer service;

an elegant store and online environment; upscale store locations; “classic” product