Tiffany Business Model Final
description
Transcript of Tiffany Business Model Final
![Page 1: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/1.jpg)
Names: Susan Tartara, Christina Caamano, Sara Birnbaum, Corinne White
Emails: "Susan Tatara" <[email protected]>, "Corinne White" <[email protected]>, "Sara Birnbaum"
[email protected], Christina Caamano <[email protected]>
MBAE 2010-2
http://www.youtube.com/watch?v=PluRW3_FEt0
http://www.last.fm/music/Marilyn+Monroe/+videos/+1-nZtGybjFjOU
![Page 2: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/2.jpg)
Tiffany & Co.
Susan Tartara, Christina Caamano, Sara Birnbaum, Corinne WhiteMBAE 2010-2
Business ModelAnalysis
![Page 3: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/3.jpg)
Agenda• Company Overview• Brand Overview• Business Model • Financial Overview• Porter’s Five Forces• S-Curve• Co-opetition• Dent’s Demographic Analysis• Mass Customization • Christensen’s Theory• Overview
![Page 4: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/4.jpg)
Company OverviewPRODUCTS-Fine jewelry-Engagement/bridal jewelry-Timepieces-Sterling silverware-China-Crystal-Stationery-Fragrances-Accessories
Tiffany Product Sales
Luxury Goods Retailer
To be the world’s most respected jewelry retailer
Tiffany & Co.’s Mission
![Page 5: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/5.jpg)
History
1837 New York City
Charles Lewis Tiffany and John F. Young
Founded Tiffany & YoungSelling Stationary and Costume
Jewelry
![Page 6: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/6.jpg)
Tiffany & YoungIntroduced its signature
Little Blue Box as a presentation box during
itsfirst year of operation
![Page 7: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/7.jpg)
Brand Overview
![Page 8: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/8.jpg)
Brand Overview1880 Tiffany originated its six-prong setting with the first diamond setting the diamond
away from the band, Expanding the diamond’s brilliance.
Permitting light to shine through the setting
InnovationIntroduction of lower-priced items to create an
“Aspiration Brand”
![Page 9: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/9.jpg)
Brand Overview
“We believe that the Tiffany blue box and the Tiffany & Co. brand have developed into one
of the best-known symbols for quality, prestige
and value in retailing, and that the value of this brand will continue
to increase over the long term” (Kletter, 1999, ¶16)
The Tiffany Experience
Focus is on customer service6 – 8 weeks training for store representatives
Training on how to prepare the Blue Box
![Page 10: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/10.jpg)
Business Model - Financial Overview
Revenue Streams:87% of Net Sales Jewelry13% of Net Sales Timepieces, tableware
and all other products
Sales Mix by Geography:57% of Net Sales Americas33% of Net Sales Asia
Pacific10% of Net Sales Europe
Tiffany & Co. Brand Jewelry Sales by Type FY08
Type of Jewelry
Description Average Price Percent of
Total Sales
A Gemstone
jewelry and band rings
$3,300 27%
B
Diamond rings and wedding bands
$3,000 20%
C
Non-gemstone
gold or platinum
based jewelry
$700 11%
D
Non-gemstone
silver based jewelry
$200 30%
Tiffany & Co. Brand Jewellery Sales by Type FY08
![Page 11: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/11.jpg)
Financial Overview
![Page 12: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/12.jpg)
Financial Overview
![Page 13: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/13.jpg)
-Threat of substitutes – EBay-
-Threat of new competitors- Blue Nile
-Sustainable competitive advantage – Brand power
-Bargaining power of buyers- displaced decision-making
- Bargaining power of suppliers - They do their own diamond cutting and polishing, jewelry crafting and distribution – limited vendors.
Porter’s Five Forces
![Page 14: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/14.jpg)
Porter’s Five Force’s Model
![Page 15: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/15.jpg)
S-Curves
![Page 16: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/16.jpg)
WEAKNESSES: - Currently they have very few
partnerships
STRENGTHS: - Famous Artists as Designers who also
make their own jewelry lines- Elsa Peretti – Bean, Tear drop- Paloma Picasso – Loving Heart collection
Co-Opetition
![Page 17: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/17.jpg)
Dent’s Demographic Analysis
TIF’s Main Revenue Source: Engagement Rings
-Average U.S. Marrying Age : Men 27.8, Women 26.0
-Next Boom?Per Dent will be 2023 (population median age of 48)
-Per Dent’s theory: TIF’s spike in growth happened in 2003 (when the population was getting engaged)
-Solution; TIF should be Lean and Innovative
-New Target Market; TIF should also target an older demographic to meet the needs of the next large boost in population
![Page 18: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/18.jpg)
-Tiffany &Co. embraces Martha Roger’s theories
-Online customization: For all Customers
-Personalized shopping: For Corporate Accounts
-B2B channel : Creates custom pieces to meet customer’s needs
Mass Customization
![Page 19: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/19.jpg)
Christensen’s Theory-Tiffany is a market leader
-Tiffany’s needs to protect their dominate market share
-Competing with retailers with lower price points, less features, and solely an online business (ex: Blue Nile)
- High Quality Vs. Lower Quality Dilemma:
• Some consumers want high quality mounting, others only need a lesser product
-Market Cap Comparison:
• Blue Nile market cap = $719.6 million VS.
• Tiffany’s market cap = $5.85 billion
-Blue Nile’s net income grew 47 % in 2009
(could surpass Tiffany)
![Page 20: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/20.jpg)
Diagnosis:
200 year old successful company with endurance & strong brand
Increased competition in the market and threats
Overview
Prescription:
Tiffany’s to continue their product image of exclusive high end brand through target market and brand managementExpand target market to older generation, future purchases
Projection: Will Achieve Competitive Edge through Brand awareness Market expansion and innovation
![Page 21: Tiffany Business Model Final](https://reader036.fdocuments.in/reader036/viewer/2022081505/554ccbeab4c905e7268b4d18/html5/thumbnails/21.jpg)
Questions