Saturday, May 11, 2013

Chapter 7. Business Marketing

Tiffany & Co. is a holding company that operates through its supporting companies. The company's main subsidiary is Tiffany and Company. Through Tiffany and Company and other subsidiaries, the company is involved in product design, manufacturing and retailing activities.
Besides consumer marketing, Tiffany & Co. is heavily included in business marketing. Tiffany & Co. is actively involved in selling its products through Internet, business-to-business and wholesale operations. It sells its merchandise on the wholesale basis to independent distributors for resale in emerging markets such as the Middle East and Russia. Additionally, the company sells diamonds that are obtained as a wholesale purchase and then resold not being suitable for the company's needs. 

There are subsidiaries of the company that process, cut, and polish diamonds at facilities outside the U.S. The company created diamond processing operations that purchase, sort, cut, and polish rough diamonds. The businesses that are involved in these operations are located in countries such as Belgium, Botswana, Mauritius, Namibia, South Africa and Vietnam. For example, Namibia is well-known for its gem-quality diamonds, which explains Tiffany's interest in this country for stones. In 2010, Laurelton Diamonds, a division of Tiffany & Co., connected with Namibia Reigh Investments to open a new cutting and polishing plant, which allowed the company to increase its workforce in Namibia. This kind of strategic alliance gives Tiffany & Co. opportunities to access rough diamonds locations reserved for local manufactures. 

Despite the fact that the patnership between Tiffany & Co. and the Swatch Group was ended, it is a good example of a strategic partnership. In 2009, Tiffany & Co. signed a 20-year license and distribution agreement with the Swatch Group. According to the agreement, the Swatch Group started a new watchmaking company in Switzerland to design, engineer, manufacture, market, distribute and serve Tiffany & Co. brand watches. The new company was completely owned and controlled by the Swatch Group but was given the right by Tiffany & Co. to use its certain trademarks. Plus, it operated under the Tiffany & Co. name as Tiffany Watch Co., Ltd.

Monday, May 6, 2013

Chapter 8. Segmenting and Targeting Markets

There are a few bases for segmenting consumer markets. They are geography, demographics, psychographics, benefits sought, and usage rate. 
Analyzing Tiffany & Co. market segmentation, I would like to look first at demographic segmentation since there are several bases such as age, gender, income, ethnic background, and family life cycle. First of all, Tiffany's main market target is women, who buy and receive as gifts these beautiful jewelry. So, even though men are involved in the purchasing of Tiffany's products, women remain to be the main influencers. With its various design collections and price range, the company meets wants and needs of consumers of different age and income. Tiffany services generations X, Y and baby boomers. While generation X, who are working women, earn enough money to pay for high-quality goods, baby boomers buy the luxurious items even despite insufficient funds. But, generation Y consumes the product because they enjoy to follow the celebrity trends.

Despite the fact that originally Tiffany's jewelry were created for high-class women, now its product becomes more affordable as the company always looks for the way to expand its market. Now even lower income women can buy Tiffany's product because of the addition of collections such as made from sterling silver.
Since Tiffany & Co. is a specialty company that sells mainly jewelry, customers turn to its product for celebration of some significant events such as engagement, wedding , anniversary or birthday. In this case, this kind of purchase may include people of different family life cycles such as young single, young married with/without children, middle-aged married with/without children etc. 
People buy Tiffany's product basing their purchasing decisions on motives and lifestyle.

Besides that women are the primary users, Tiffany services other businesses also. The company sells its products to businesses to promote some program or give gifts to dignified employees. The company regularly designs trophies for some special events. Plus, Tiffany & Co. are deeply involved in charitable activities giving generous donations for the support of arts, education, health and environment.