Introduction
Tiffany & Co is a world-renowned brand that specializes in luxury jewelry and other specialty items, which means that it has an extensive range of products such as watches, chinaware, jewelry, leather goods, and so on. Due to the high price of its products, the company targets its products to wealthy clients that value exclusivity in what they buy. Despite high prices that Tiffany & Co set on luxurious jewelry, the company has been able to diversify the product range to include fragrance perfumes, eyewear, textiles, items for pets, and more. For expanding revenue, the brand also focused on expanding low price products to create a reputation of an inclusive luxury brand.
Product Lines and Competition
If to consider the most important product lines that Tiffany & Co offers to customers, luxury jewelry and gifts are the key items that should be discussed. Both product categories are targeted at gift givers and gift receivers during special occasions such as birthdays, Christmas holidays, engagements, and so on. Also, affluent customers may buy products for themselves as a way of pampering. Jewelry and gift items (silverware, china, leather goods, crystal stationery, etc.) are sold worldwide.
Tiffany stores are located in Europe, the Middle East, the Americas, the Asia-Pacific Region, Russia, and the UAE (Key). Since 2014, the company experienced a tremendous increase in revenue and ended fiscal 2015 with $4.2 billion (Key). In addition, through selling jewelry and gifts, the brand managed to achieve compounded annual growth rate of 9.4% in sales (Key). This points to the massive popularity of Tiffany products despite their high price.
The main competition for Tiffany comes from other jewelry brands that have also differentiated their product line to appeal to a wider audience. Blue Nile and Pandora are identified as competitors because of similar products and price range as well as the target segment of consumers. Blue Nile is considered the most popular retailer that sells diamond items online in the United States and has recently broadened its operations to sell internationally (“Brand Positioning – Competitor Analysis”).
Through the use of the business-to-customer model without establishing any physical stores, the company can offer lower prices than competitors, which is an extreme threat for Tiffany that has invested into hundreds of physical stores. In addition, Blue Nile has a unique selling proposition through offering personalized items to customers and ensuring good communication with clients through live-chats, emails, and toll-free call assistance for reducing the risks that come with shopping online.
Pandora is a unique competitor for Tiffany & Co because it has established fairly recently but is already extremely popular worldwide. The selling proposition of the brand is offering customers a wide range of affordable genuine jewelry that will express their individuality. Compared to Tiffany, Pandora has a unique selling proposition that cannot be replaced (“Brand Positioning – Competitor Analysis”). Overall, both Pandora and Blue Nile present threats to Tiffany & Co due to the extensive product range that they offer as well as lower prices. However, it is important to remember that clients stay with Tiffany because of the long history of the brand as well as customer-orientedness of its business strategy that has helped the brand remain successful for decades.
Marketing Analysis
For becoming a marketing superpower, Tiffany continuously changed its direction by reading the market and tuning to customer demands. The unique marketing methodology inherent to the brand relates back to the 1830s when Tiffany decided to establish set prices and limit any negotiating and bargaining (Agrawal). In addition, the company empowered itself and evaluated its products as valuable, which significantly influenced customers’ purchasing decisions.
Today, the marketing strategy that Tiffany implements consider both traditional and modern ways of product promotion. Billboards, television advertisements, campaigns with the participation of big celebrities have all been key components of the brand’s marketing strategy. It should be mentioned that identifying the number of potential clients that see Tiffany’s traditional ads is hard compared to finding out the number of followers on social media. However, Tiffany’s “Will You?” television ad as twenty-four thousand views on Youtube while its “A New York Minute” ad for watches has more than nine hundred and twenty-four thousand views, which points to the wide coverage of ads not only offline but online.
The brand has also seriously invested in social media marketing and became the highest ranked brand in terms of responsiveness and engagement within the sphere of social media (Koh). This sets the brand apart from competitors that usually focus on promoting products while ignoring customers’ requests. The comparison of Tiffany’s and identified competitors’ social media following is presented below:
These numbers show that Tiffany & Co is extremely successful in its online marketing efforts and has much more dedicated following compared to its main competitors. Apart from promoting the latest campaigns on social media, Tiffany has broadened its strategy to design a mobile application for customers to choose their ring styles and carat weights (Koh). The innovative app also allows users to take photos of their hands as if they are wearing Tiffany rings in real life. Thus, compared to traditional marketing efforts, Tiffany’s online strategy has shown to be more successful because it enhanced engagement with customers.
Works Cited
Agrawal, AJ. “How Tiffany & Co. Built a Marketing Empire.” Forbes. 2016. Web.
“Brand Positioning – Competitor Analysis.” Brandtiffanyandco. Web.
Key, Diana. “A Must-Know Business Overview of Tiffany & Co.” Market Realist. 2015. Web.
Koh, Michelle. “Diamonds for the Digital Age: How Tiffany & Co. Embraced Online Marketing.” ReferralCandy Blog. 2016. Web.