Tiffany & Co. Marketing Strategy
The American economy suffered a major blow after the September 11 attack in 2001. Concerning the jewelry sector, it has recovered impressively from the declining sales that the industry experienced in that particular year. Over the time the company has developed and is one of the leading respectable retailers. Tiffany has greatly concentrated on the customer feeling. Tiffany circulates its product via channels, and the company operates 141 stores directly under the company. The existing distribution mediums represent the about the half percentage of revenues, and international retailing represents 40% of revenue from direct marketing bringing together sales from Internet sources and other sources that do not exhibit the retail concepts as laid down by Tiffany.
By the year 1963, the Tiffany country had already opened a store in the New York City later other stores were opened in Beverly Hills and thereafter another became operational in Houston. Currently is can be argued that the Tiffany organization runs 51 stores in 22 countries. Tiffany has generated a lot of revenue due to its initial investment in New York which has been recorded to having generated almost a quarter of the company retail sales globally. Tiffany aims at expanding its retail market presence by 5% on annual bases. With a projection plan of operating an average of three to five stores in other countries on a yearly basis, Tiffany does not enjoy its presence in 17 metropolitan areas in the US. It is because of this, that the leadership in Tiffany has aimed to acquire an average of 80-100 stores and retaining the good image of the brand that Tiffany has held when it comes to luxury jewelry. In addition, Tiffany has started developing smaller stores that do not necessarily require a huge amount of investment like big stores. The main focus of these main stores is to enhance higher sales of jewelry.
The Tiffany stores have gone a lot of rebranding to make sure that its products remain competitive and relevant. The partnership with Hollywood has immortalized Tiffany’s stores through the adaptation of the book Breakfast at Tiffany’s. The movie involves the regular admiration of the store through windows displaying. More than forty security personnel were hired to safeguard the valuable store. The Tiffany stores have tried to create a brand image for the store mainly through the Tiffany Blue box. The stores have a purpose of ensuring that the integrity of Tiffany’s company is maintained through it brand. The stores have demonstrated the growth of the company over the years. In times of difficult financial and economic situation, the stores have indicated that the company prospects were still high, and it was way ahead in terms of competition. The stores have unveiled products that are priced lower to carter for the needs of the ever growing consumer base seeking quality products at an affordable pricing. The stores have also been relevant in the displaying of high quality jewelry in order to develop a sustainable advantage. The stores have been used to illustrate their innovation strategies that are encouraged to develop products that are in line with the new trends in the jewelry marketing. The stores are creating a positive image of the company and generating confidence to the consumers. The stores are an indication of the growth of the company in terms of revenue and consumer base . They have indicated the company strategies of bringing the services closer to the people as the stores have been opened in other parts of the world apart from US.
The Layout Strategy
The company has in recent times developed products that are aimed at meeting the needs of every consumer in respect to their financial capabilities. The company has developed products that are aimed to satisfy the need of middle income earners. The company ensures that the product and services are not compromised in any way, and it has also ensured the customers on efficacy in their operations.
In the accounting strategies, the company has adopted conservancy concerning its financial and accounting measures. As provided by the US law, the company hires GAAP accounting, which enables flexibility in many areas. It has also shifted to the average cost technique. The company regularly reviews goodwill to determine whether if there is any occurrence of impairment. Tiffany has referenced the most critical indices in order to determine the most accurate method to estimate the pension returns of its workers. In the reporting of pension costs, Tiffany and Co. has applied the credit actuarial procedure. It usually involves the hiring of an actuary to estimate pension expenses accrued by the company and it is perceived as the most accurate methodology.
- Free plagiarism report (on request)
- Free title page
- Free customer support 24/7
- Free outline (on request)
- Free reference list/bibliography
- Free abstract (on request)
The turnover ratio gives a clearer picture to the interested organization on the way that sales are conducted. In enhanced turnover ratio is an indication that the company is receiving cash. In respect to the rate of return equity, Tiffany and Co. has provided an insight of these equities over a period of time. The company has indicated enhanced profit returns on the capital invested by the shareholders. This has made the company attractive to investors.
Gross margin is used as a tool to measure the operational efficacy of a given company. Tiffany and Co. has a resilient and competitive gross margin implying that this company has the potential of enhanced profitability in its sales compared to its competitors and the industry at large. The company is better placed if markups are to arise because its consumers will be willing to pay extra fee to get the brand name of Tiffany’s.
Tiffany and Co. has received completion from other brands such as Bulgari and Blue Nile. These companies have tried to work on the weakness of Tiffany for the purpose of getting ahead when it comes to competition. These companies have not been that successful to measure up to the competition that Tiffany has put up against them. The other companies have not been able to match up with value of assets of Tiffany which includes quality and reputation which is not the case in them. Products from other companies have been imitated, but Tiffany has branding of Blue Box has never been imitated. Tiffany has developed products that meet the need of a wide range of market niche. The company has mainly focused on jewelry. The blue box is a signature that is used to distinguish Tiffany’s products from other products in the market. Tiffany has upped its game against its competitors by focusing on specific market and particular group and from such a group the company develops a more insights on the cost strategy.
Unlike other competitors, Tiffany gets its capital from investors from outside while its competitors have used debt financing. Since the raw material is the main cost, Tiffany has entered into long term contracts with companies such as De Beers and Aber Diamond Corp. to ensure steady and smooth supply of raw materials. The borrowing ratio of Tiffany Co. is low compared to the borrowing ration of its competitors. This put Tiffany Co. in the highlight concerning this industry, and the company has an enhanced leverage to growth compared to its competitors. It is, therefore, critical for companies such as Tiffany Co. to focus on their original goals and objectives to promote their original brand image. Tiffany has huge prospects and though there maybe challenges the company is there for the long run.