Tiffany Case Audit

SWOT Analysis

  

A. Problem Issues:

Profit Margin Growth Slowing Down

Due to the cost of brick-and-mortar store increasing, the profit margin dropped in physical stores. It is hard to keep high-profit margin in brick-and-mortar store even in wealthy areas.

Counterfeit Goods

The counterfeit goods are a big issue that hurts Tiffany’s fine jewelry sale. Although in the Tiffany vs. eBay case judge and juries believed that counterfeit goods sold on eBay would not dilute the Tiffany’s brand name, the cheap counterfeit goods sale steals the company’s sale and market share.  

High quality jewelries sale in wholesale or warehouse

The jewelry industry is in the mature stage that has low entry barrier. The competitors can make similar products with low price that sells in low-cost retail stores. All these wholesale and warehouse one-stop shopping center can provide large discount that Tiffany could not provide.

Consumer brand loyalty decreased in jewelry purchasing

As the knowledge of jewelry spreading through the Internet, consumer found that there is no difference in quality between brand name jewelry and wholesale jewelry. Consumers can buy very similar design of jewelry with 30% off price if they forget the brand name.   

B. Alternative

Store expansion

Although the cost of brick-and-mortar operation is high, Tiffany still needs to expand its stores making customers easy to access in person that increasing the sales. The global stores can be seen only in very few cities outside the U.S. today. The new stores opened globally could expand Tiffany’s geographic reach.

Brand alliance

By alliance with another luxury brand which could expand Tiffany’s product lines and  attract more visiting counts. The largest jewelry sales are engagement ring that can only attract small portion of customers to visit and make a purchase. 

Products for men 

In recent year, the sales of men’s accessories and fragrances have spectacular growth. The sales in men’s product categories are becoming an important segment. Paying more attention in men’s accessory segment could keep the company growing in the mature jewelry industry.

Online sales

Thanks for the Internet and mobile devices price drop, time-saving online shopping become popular. More and more people purchase jewelry online after comparing the style, size, and price.

C. Decision Statement

The jewelry market is a mature industry that there is no single one company can dominate the market.  For the further growth in sales and profit, Tiffany needs more presence on the market. That is; more stores appeal in the market and more product categories provided to the market, especially the Asia market. 

D. Team Evaluation Form

More store expansion could help the company to increase sales and brand name presenting. In addition, more stores present on the market can help the company to fight the counterfeit goods market. Although, new store expansion will cut down profit margin in the short term but, it will increase the sales and margin for the long term.