In January, the multinational French luxury goods corporation- Moët Hennessy Louis Vuitton (LVMH) successfully acquired a timeless jewelry brand- Tiffany & Co. for $15.8 Billion US Dollars. Since then, Tiffany & Co. has undergone numerous changes as they reposition their brand image to adhere to a younger generation rather than an image that reminds you of “your mom’s jewelry”. Let’s dive into the details.
- How did Tiffany & Co. become so successful?
- The Tiffany Blue
- The Signature Setting
- The Mark for Silver
- Influencers and Marketing
- A Time for Change
- Social Media
- Key Changes
1. How did Tiffany & Co. become so successful?
With a $1,000 advance from his father, Charles Lewis Tiffany began a “stationery and fancy goods store”. In 1837, he and John B. Young (a friend) rapidly grew his business and began selling glass, cutlery, jewelry, clocks, and other goods.
The company set a new precedent by implementing set prices since bargaining was the standard back then. This implementation would set their prestigious standards. While most jewelers at the time took credit, this company decided to only accept cash payments. This attracted a different market because it was only the wealthiest consumers who could afford to pay cash upfront for the high-quality goods.
“Tiffany, Young, and Ellis,” later became the international luxury jeweler and specialty retailer Tiffany & Co. The brand strived to continuously implement a commitment to successful operations pertaining to strategizing as well as adhering to very diverse generations so that they would never lose their essence of “excellence in jewelry design, luxury and customer service”.
2. The Tiffany Blue
As a marketing strategy, Tiffany & Co. trademarked Tiffany Blue, which is a color inspired by the medium-colored shade of Robin’s egg. The success with this color affiliation to the brand later led to the creation of the “little blue box.” Due to its easily recognizable shape, size, and color, Tiffany has set rules to not allow a Tiffany blue box to leave the store without containing a purchased merchandise item inside. The exclusivity of the packaging along with the products made Tiffany items even more desirable to consumers.
3. The Signatue Setting
Tiffany and Co. introduced their “Tiffany setting” for rings. This setting is different from others because the band sits close to the finger and includes six prongs that securely hold a round brilliant–cut Tiffany diamond. This forever changed the design of engagement rings, because this setting allowed more light to enter the diamond from all sides. The Tiffany engagement ring setting is arguably the most popular setting in the world and is most certainly Tiffany’s bestseller.
3. The Mark Of Silver
Tiffany was the first US company to adopt the 925 / 100 European sterling silver standard. Tiffany & Co. accepting this standard was instrumental in their success as it did not become adopted by the United States in 1851. Later, in 1867 at the Paris Exposition Universelle, Tiffany became the first American company to win the prize for excellence in sterling silver craftsmanship.
4. Influencers and Marketing
Tiffany was appointed as the royal jeweler for the crowned heads of Europe, Ottoman Emperor, and the Czar and Czarina of Russia, following the Paris Fair in 1900. As mentioned previously, Tiffany & Co. worked alongside the wealthiest families in America, such as the Vanderbilt, Whitney, and Astor families on commissioned silver services and jewelry.
Famous Figures and Tiffany
- Franklin Roosevelt purchased a Tiffany engagement ring for Eleanor Roosevelt in 1904.
- Tiffany was also a favorite of First Lady Jackie Kennedy, who wore a Tiffany brooch gifted to her by President John F. Kennedy following the birth of their son.
- President Abraham Lincoln purchased a Tiffany seed pearl necklace and earrings for his wife, who wears them to the inaugural ball.
- Mary Whitehouse, wife of American diplomat Edwin Sheldon Whitehouse.
- Hollywood icon Audrey Hepburn, Recognised as both a film and fashion icon, she was ranked by the American Film Institute as the third-greatest female screen legend from the Classical Hollywood cinema and was inducted into the International Best Dressed List Hall of Fame.
Celebrities and Tiffany:
Today, Tiffany is still working with celebrities to elevate their brand and the luxury of their jewelry. Recently, Tiffany & Co. partnered with singer, songwriter, and actress, Lady Gaga, to attract attention from the new millennial generation.
Other notable celebrities include:
- Beyoncé Giselle Knowles-Carter (Beyoncé)- an American singer, rapper, songwriter, and actress who rose to fame in the late 1990s as the lead singer of Destiny's Child, one of the best-selling girl groups of all time.
- Hailey Beiber (Hailey Baldwin)
- Kendall Jenner
- Ariana Grande
- Camilla Cabello
- Kim Kardashian
- Khloe Kardashian
- Selena Gomez
- Paris Hilton
- Vanessa Hudgens
- Taylor Swift
- Reese Witherspoon
- Dua Lipa
- Jennifer Lopez
- Margot Robbie
- Rita Ora
- Jennifer Lawrence
- Natalie Portman
- Emma Stone
- Jessica Biel
- Gwyneth Paltrow
- Kate hudson
- Lea Michele
- Blake Lively
- Cameron Diaz
- Kate Middleton
- Jennier Aniston
- Jessica Simpson
- Anne Hathaway
- Demi Lovato
- Carrie Underwood
6. A Time For Change
As Tiffany & Co. fell under new management, so came a shift in the brand’s focus. The new strategy was to introduce elegant, high-end, sparkling jewelry, and stray away from the affordable, sterling silver product lines. Even with this very diverse direction in mind, CEO Bernard Arnault of the LVMH Group stated: "We will prioritize Tiffany’s long-term desirability over short-term constraints".
The brand settlement was set to take place in 2020 however constraints due to the COVID-19 pandemic delayed this process. The case ended up taking place in early 2021 in a Delaware court, not too far from my Delaware home. Bernard Arnault has also appointed his son Alexandre Arnault – who served as the former CEO of LVMH-owned luggage brand Rimowa – as Tiffany’s executive vice-president of product and communication. He is now working with Tiffany’s newest CEO Anthony Ledru (formerly the head of Louis Vuitton in the Americas).
Anthony Ledru, brings a diverse perspective to the repositioning of Tiffany & Co. He comes with a background from Harry Winston and Cartier where he held senior positions. The repositioning set fire when Tiffany & Co. purchased an 80-carat D color internally flawless diamond. This diamond is intended to be used in Tiffany’s most expensive necklace to ever be produced and set for sale. The diamond necklace is expected to be unveiled in 2022 when the doors of Tiffany & Co’s. transformed Fifth Avenue flagship store reopens. A Tiffany spokesperson confirmed the final price will be "within the eight-figure range”, making it more than $10 million US dollars.
Victoria Reynolds, Tiffany & Co. Chief Gemologist said: “What better way to mark the opening of our transformed Tiffany flagship store in 2022 than to reimagine this incredible necklace from the 1939 World’s Fair, one of our most celebrated pieces when we opened our doors on 57th Street and Fifth Avenue for the first time.”
7. Social Media
In Tiffany’s most recent campaign “Not Your Mother’s Tiffany” which has been trending on Instagram as well as on the advertisements of Manhattan, they have indicated their desire for change and improvements. One of these changes clearly points to introducing new high-end jewelry as stated previously. Signs point to this as the ads picture a model rocking a $1,500 US dollar bracelet as well as a pricey silver chain link necklace. Other ads incorporate multiple models wearing casual clothes and “carefully unstyled” hair. This form of advertising was used to convey a younger, more gen-z appropriate style.
Tiffany & Co.’s full-year earnings will no longer be made publicly available, but in 2019 the company’s revenue totaled $US 4.4 billion dollars. In its most recent financial report (from November 2020) which covered the first nine months of the year, it was noted that Tiffany’s revenue had fallen by approximately 25% as a result of impacts caused by the COVID-19 pandemic.
This means that the total revenue for the year would have been approximately $US3.3 billion, this value is approximately equal to LVMH’s division of existing Watches and Jewelry, which includes Tag Heuer, Fred, Chaumet, Zenith, and Bulgari.
In 2020, the Watch and Jewelry division recorded revenue of EUR 3.4 billion dollars which represented 7.5% of the LVMH Group’s total revenue as well as a decline of 24% from the previous year.
9. Key Changes
- Tiffany’s brand repositioning no longer recalls the iconic Audrey Hepburn. Audrey Hepburn brought worldwide attention to Tiffany’s in the 1961 movie, “Breakfast at Tiffany’s”.
- The management of LVMH is expected to replicate the same control strategy for Tiffany & Co. that they took when acquiring Louis Vuitton.
- Tiffany and Co. is planning to introduce men’s engagement rings as well. This new product line is another effort to attract a younger, more diverse market of consumers.
- As of right now, there is no indication that Tiffany will have unusual apparel for its exclusive clientele but there have been rumors that this will soon be coming. Only time will tell.
Tiffany & Co. is continuously improving their brand and working hard to ensure that its legacy lives on. Tiffany and Co’s repositioning strategy is just another step in the right direction. The brand holds a special place in my heart because when I turned sixteen I had the privilege of walking into the Tiffany store on Fifth Avenue and walking out with my very own little blue box that contained a “Return to Tiffany Heart Tag Pendant Necklace”. Even in 2016, to a sixteen-year-old, the jewelry felt timeless.
Coming from someone who loves the brand, owns the products, and is a gen-z female, I think this new take on the company will prove to be very successful.