why did tiffany prices go up?

[UCLABelle]

First, I never thought of Acura’s as a luxury brand. But maybe that is just because of where I am from...

As one of the “teens” that “tarnished” the luxury perception of Tiffany by purchasing some of their silver, I personally feel that instead of attempting to price out the market, perhaps they could make an accommodation, similar to the floors at the 5th avenue Tiffany (one floor silver, the other diamonds and gems for the more “wealthy” customers).

Winternight- While you are entitled to your opinion, I found your comment slightly offensive regarding being “mobbed by teens”. You just wrote that “the front of Tiffany, where the expensive stuff is, is totally dead, while the back with the sterling is full of people”. If that the case, and you are the wealthy shopper in the front, you wouldn’t run in to many “teens”. At least, all of the Tiffany’s I have been to are large enough that this does not happen. I also disagree that one does not find affordable items at Gucci, LV, or Prada. Don’t you recall those small little Prada, Gucci and LV purses that were around $200-300. That seems similar to the current sterling pieces at T&Co.

In any case, if T&Co becomes more exclusive, fine...I just find it a bit sad at the principle...

 

[Sundial]

I have to agree with UCLABelle. Just as Louis Vuitton and others have some lower priced handbags and things to bring customers in the door and get them interested in the brand name, Tiffany has their sterling silver collection presumably to attract new buyers who may someday purchase more expensive items. I was in the Scottsdale Tiffany''s on Valentine''s Day and they had the pricier items in a separate room. Both rooms were full of male customers and quite busy. I certainly didn''t feel like the place was overrun by teenagers and I also hate to see Tiffany''s get hung up on being "exclusive".

 

[fire&ice]

I think it is a smart move. They have lost their panache and cache. It''s been happening for YEARS. Might be too late. They have been selling trinkets too long.

 

[Nicrez]

Date: 3/1/2007 2:52:26 PM
Author: UCLABelle

First, I never thought of Acura’s as a luxury brand. But maybe that is just because of where I am from...

As one of the “teens” that “tarnished” the luxury perception of Tiffany by purchasing some of their silver, I personally feel that instead of attempting to price out the market, perhaps they could make an accommodation, similar to the floors at the 5th avenue Tiffany (one floor silver, the other diamonds and gems for the more “wealthy” customers).

Winternight- While you are entitled to your opinion, I found your comment slightly offensive regarding being “mobbed by teens”. You just wrote that “the front of Tiffany, where the expensive stuff is, is totally dead, while the back with the sterling is full of people”. If that the case, and you are the wealthy shopper in the front, you wouldn’t run in to many “teens”. At least, all of the Tiffany’s I have been to are large enough that this does not happen. I also disagree that one does not find affordable items at Gucci, LV, or Prada. Don’t you recall those small little Prada, Gucci and LV purses that were around $200-300. That seems similar to the current sterling pieces at T&Co.

In any case, if T&Co becomes more exclusive, fine...I just find it a bit sad at the principle...

Acura is a luxury car? I agree with you UCLABelle...never considered that, but it is... In NY we don''t have cars so much as cabs...

It''s a combination of reasons, but the greatest reason is that TCO is a public company with shareholders. They are an expanding company with many new endeavors that are offering more than they used to, including a new designer (which costs money to launch and advertise), as well as new pieces, new certificates for their diamonds, and are also finding more competitive ways to source their stones. All this work costs money, and that in turn is passed to the consumer, because no company wants to operate where expansion is cut into their profit margin. Because of those very same "mobbing teens" they are both gaining in profit margins (silver has THE HIGHEST profit margin from creation to sale) but that same profit which gains them a foothold in the higher end fine jewelry market is not where they want to be long term. Their competition in that cetagory would be Zales and Kay where the price points are similar.

They are trying to get a stronger foothold back into the luxury jewelry market, which is still their largest. They are known for engagement ring sales, and statement pieces, which based on percentage is NOT their highest profit margin, but yeilds greater profit (per dollar) on fewer pieces sold. It is a race of quality sales versus quantity sales. They need to sell more diamonds where their values go up, even if the margins are significantly lower. As such, they are raising the prices on their silver to also counteract that increase of sales there, and as a welcome side effect is the brand image "improvement" of exclusivity based on higher prices. They are not shutting out a market, simply trying to steadily revert back to the luxury market they were once better known for. Remember Tiffany was known for custom design pieces first and foremost, then for high end luxury Art Deco that was never really replicated. (FYI: the lamps were made as a side business)

Also, their flagship store and many of their larger stores (from what I know of the others: White Plains, Greenwich, and Manhasset locations) all include seperate counters for silver that are somewhat seperated, so as to delineate what areas are higher end, and silver is usually in the back or a corner. It''s not their mainstay, but it is an offering. As for being mobbed by teenagers, the flagship store is no exception. At ANY given pojnt in time the silver floor (2nd now I think, as they remodeled) is always busy, even in the early morning.

Their price increases have several reasones, but as so many accurately put it, "because they can" is the best reason. If the market will allow for a price increase without a significant drop in sales, they will. And for them, it is almost beneficial to drop in sales in this area without a major loss (quantity of items sold are reduced, but not actual dollar profit), and they will push other markets, like China and other such emerging to gain a foothold in the diamond markets where their luxury image is increased and their profits (value-wise) will go up.

 

[fire&ice]

..just to clarify. The lamps were not a side business of Tiffany & Co. The lamps were an endeavor by son Louis Comfort Tiffany who did run the jewelry segment at T& Co. for a while. I had the opportunity to view some of the jewelry pieces designed by LCT while at T&Co. They are really special. He designed the famous "Iris" brooch that I think resides in the Met. They did have a good prescence in the Art Deco period; but, on the secondary market Cartier and other names surpass. I just don''t think they took the chances that some of the other jeweler''s did. They lost a lot of commisions because of it. An another note regarding silver, T&Co. refused to retail Georg Jensen - prompting Georg Jensen to open is own competing jewelery/object store in NYC. Ever since the 1st part of the 20th century I don''t think T&co. has been very forward thinking to maintain their edge & exclusivity (sp?).

T&Co. & LCT furnances/glass are completely separate. More than likely, some of his pieces may have been retailed by T&Co. Many people think they are one and the same. They are not.

It''s no secret that I have never been a fan of TiCo. - mainly because of this mass marketing thing they morphed into. I have to say. The last time I was in the NYC store - they had far more high end art glass than the mass market stuff they had been carrying. I also find it curious that for the longest time the silver counters were at street level - just a very plebian feel to it. I don''t know if they still are.

 

[fire&ice]

I think the Acura, Lexus reference were to their respective luxury lines of Honda/Toyota - if I got the right companies.

 

[Nicrez]

F&I is right. I mispoke. Not a side business by Tiffany & Co, but a side business by his son, LCT with the help and backing of his father. Tiffany sold some of their pieces, but they are NOT part of the Tiffany & Company stock. LCT did make some jewelry pieces, but he was mostly known for his glass work.

I also would never argue that the French designers would take presidence over Tiffany pieces, Art Deco or otherwise. Cartier, VCA, Chaumet, Lalique, etc are always far more exclusive and (in my opinion) their craftsmanship is far more impressive and daring.

But in the end, they are still trying to raise their image to compete with the likes of Harry Winston and Cartier, so they have to increase exclusivity at the risk of losing some silver business, and rededicate themselves to their original craft of diamond, gemstone and precious metals.

 

[fire&ice]

I just think the marketing strategy may be a little too late. And, still find it odd that the silver was street level. It''s almost like they were inviting less cache as a strategy.

Actually, I am too versed on the Jewelry of son Louis Comfort Tiffany.

A client is going round and round that his jewelry (LCT) not be maked with the tico mark & should only be marked w/the Tiffany Studios mark (LCT furnances, etc.)

In 1907, LCT jewelry became a division of T&Co. So, his pieces would be marked after that w/ the tico mark. He continued on separately making his glass, bronzes & lamps under his own company - Tiffany Studios completely separate from Tiffany & Co. If anyone is interested, a very visual good book on his jewelery is entitled "The Jewelry and Enamels of Louis Comfort Tiffany" by Janet Zapata - Abrams publisher. His stuff is quite distinctive and very avant guard - much not incorporating high end jems - but enamels, colorful stones. His pieces are commanding record breaking prices surpassing estimates in the current climate.