Where Is The Problem Of Tiffany'S Marketing Disconnection?

Everyone who knows me should be clear.

It's not one or two days. It's been one or two years.

For this matter, Tiffany's mainland public relations Agency also asked me if I had received black money from my competitors. In order to do this, Tiffany's mainland public relations Agency also had friends in my circle.

I have been in the media for many years, and I can understand the position of public relations.

But this attitude can only be contrasting.

Disadvantages.

Recently, my attitude towards Tiffany has changed. Of course, it is not that I have received money from Tiffany, or that the Agency in mainland China has given me a circle of praise.

An objective and rational view and study of an industry can not only become a good industry expert, but also become a good investor.

Today, let's talk again about Tiffany's company and brand, and Tiffany & Co. (TIF.N).

1, negative factors

Investors in retail and retail stocks are very conservative, so risk is the first.

In many of the articles written by Tiffany, I wrote two more attentively: "true love is dead, the wedding ring king Tiffany's Besieged" and "do not talk about true love, talk about the divorce rate, Tiffany will cry".

The two articles are not from a purely financial point of view. Today's pformation of the retail industry is no longer a good problem for a company or a brand. It is already a category and a market segmentation trend, such as a good sports market, a weak market for women's shoes and so on.

Tiffany's biggest problem is that, as mentioned in the two articles above, it has been out of date from product to marketing.

So we see, even luxury goods.

In the year of recovery, Tiffany was still in a negative position in the same store sales, although the company pushed the performance responsibility to the main Fifth Avenue flagship store, because the strong dollar and anti trump action (Tiffany's flagship store near Trumpt tower in New York) were not convincing for two reasons.

Is a modern urban independent woman willing to spend 2000 dollars to buy a tiffany ring, or is she willing to spend the same price on 20 or 30 fashionable Pandora bracelets that can be DIY?

I have been comparing the two brands, because in the past two years, the two brands are in the opposite direction.

Many people laugh at how these two brands can be compared. The two brands are not competitors at all.

If Tiffany's own management personnel think so, I am afraid it will be another negative factor of brand.

But I think that Tiffany's old management, from Chairman to CEO, is all fired, and the new management will not think so.

According to the world clothing shoes and hats net, the rich consumers usually have a quantitative value in the luxury industry, not that the quantitative is only for one brand, but for the whole industry.

The variable lies in the non wealthy class, which is what we usually call middle class. Tiffany is losing this part of his customers.

If you buy a $150 Elsa Peretti series of silver rings, you may be considered poor and greedy and vain. At the same price, if you buy a Pandora, you will be considered fashionable and independent.

Does the retail industry rely on high unit price or repeat purchase rate? Both have living space.

But for the middle class variable, there is only one option.

The regulator of luxury goods industry is the introduction of a store and the proportion of entry.

Modern women's choice of jewellery consumption has gone against Tiffany's culture, marketing and brand image. Tiffany's recent "ten thousand dollar clip", which is widely advocated by social media, is precisely a brand image of "love and marriage" in the past, trying to create a sense of "EVERYDAY OBJECTS".

The ten thousand RMB clip is 18 karat gold, and the gimmick public will not use 1000 silver paper clips to make headlines, but the middle class will be willing to pay for the 1000 yuan gift.

It is a marketing tool to produce ten thousand RMB clip clips, and a large quantity of 1000 RMB clip clips is a means of production.

This is a strategy for the retail industry. As I have always said before, the luxury industry has made a series of small LOGO products from LOGO to sell, or to sell LOGO.

2, positive factors

The positive factors of Tiffany are far more than the negative ones. All factors in the luxury industry can be called positive factors. There are a few of them listed here, even in the luxury industry.

Tiffany is a "sister" in the high-end jewelry industry and has the largest turnover.

The theme of "love" and "marriage" is Tiffany's weakness, and even Tiffany's incomparable value.

A breakfast of Tiffany has closely linked Tiffany's dream with love, beauty and romance for nearly 60 years.

As long as the love and marriage system has not been completely destroyed, Tiffany's high-end series still has a stable customer base.

As long as the luxury industry still exists, Tiffany is always the last brand to disappear.

3. Variable factors

When Tiffany launched the "daily series", there were not many surprises, because the brand had always had some related products, but the daily series was more formal and interesting than any other daily product or gift product.

This can be seen as a change made by Tiffany's new and comprehensive management team.

But the real twist on my brand development is the Tiffany Cafe project, which I saw as a change, so we also raised Tiffany's rating and target price. Then Tiffany's quarterly report also strengthened the basis for this increase and the decision to raise the target price again very soon.

The positive factors of Tiffany are far more than the negative ones. All factors in the luxury industry can be called positive factors. There are a few of them listed here, even in the luxury industry.

The possibility that retail industry can be called change in recent years is the problem of channel, but this is just popularizing in the luxury industry. Even the online channel has much more effect on the marketing and experience of the luxury industry than the sale. The same is true in the future, but it will be closer, but it will be divided according to the size of the brand.

Online channels make the flow of traditional channels fail, and the most affected department stores have to increase their popularity by increasing the sales area of catering, entertainment and beauty.

Therefore, I regard Tiffany's Cafe as a landmark event on the road of brand change.

29 dollars, you can't buy anything in Tiffany, but you can stay for half an hour and have a set meal, which means that for most consumers, dreams come true.

From the point of view of making money, the cafe is certainly not a good business. The 4 storey Tiffany Fifth Avenue has a daily rental of about $38-40.

From the perspective of brand premium protection, cafes are not a good strategy either. LV or Gucci need to consider a beauty series or perfume. Although Chanel half of the business relies on beauty, there are 5 such perfume products as iconic and storytelling products.

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Retail is also developing dynamically.

The biggest problem in traditional retailing industry is passenger flow and experience.

So Tiffany's Cafe has a negative impact on money making and brand value, but has also been enhanced in drainage and experience.

What is the reason for the sustained growth of the luxury industry? The direct cause is demand and price increase.

10 years ago, few people could afford to buy luxury goods, but today, especially in China, people who have stable jobs in cities are basically able to afford their luxury goods. This is also the main reason for the continuous growth of the luxury goods market over the years.

Luxury Chinese consumer portraits, on average, are younger and poorer than customers in international markets.

In addition, cultural differences also enable an American girl to try Tiffany's coffee openly and openly, while a Chinese girl might buy a Tiffany product first and then line up with Tiffany's bag.

The most important way of thinking for managers of luxury goods industry is not to regard luxuries as luxury goods, but to create a concept of luxury for customers while taking luxury as a consumer goods.

This seemingly contradictory management, in fact, the two starting points of product strategy and marketing strategy are the two routines on the lips and the mind. It is the fact that the price of paper clips is priced at US $1000 for us $100, and it is the operation of Capucine Monogram series.

Starbucks is certainly not a symbol of affluence and taste in today's first tier cities. It has even become the opposite of these two characteristics. Starbucks is certainly not a part of it, even if it is not a brand.

Like the luxury industry, those swaying customers decide the strength of a brand in the industry, and wealthy customers are usually more loyal customers.

4. Operation of Tiffany & Co. (TIF.N)

After the launch of coffee shops, we raised the target price of TIF to US $112.

The increase is based entirely on a change in the management and strategy of the group, as well as a judgement on the big market in the luxury industry, because the action was taken before Tiffany's Q3 earnings and Earnings Call.

Since June 2016, the trend of TIF has always been upward, which is in line with the overall performance of the luxury goods industry.

This year, the trend of TIF is also upward, with an increase of about 25%, which is also basically the same as the luxury market.

However, from the perspective of K, the TIF side game is too long. Since March, it has always been a horizontal bar, which is maintained at around us $95. Obviously, the US $100 is a pressure level and a breakthrough of 100 US dollars. In fact, it is basically our target price. Based on the 2017 fiscal year, adj EPS is equivalent to 28 times P/E, which is lower than the median of LVMH SE, Kering SA and Richemont SA. Imagine that even more than 30 times that of the SA.

After the Q3 earnings report, the stock price unexpectedly fell after TIF's performance Beat, which is actually the best opportunity to buy or make up.

The second day increase shows that this operation is correct, and KeyBanc also raised TIF TIF to $115.

In addition to brand and big market confidence, TIF has released positive US signals at Q3, and the same store sales have been pformed. The Americas currently account for over 40% of the group's business, of which New York's single store accounts for about 20-25% of the Americas.

There is no need to worry about the gross profit margin of parity jewellery, daily series and gifts in the long run. There is no direct relationship between gross profit margin and unit price.

After scale, not only can we increase the passenger flow, but also we can prepare the customer echelons for the price sections for the brand.

In addition, parity products can help brands quickly open the electricity supplier penetration problem.

After breaking through $100, TIF should be very secure with a 10% gain.

More interesting reports, please pay attention to the world clothing shoes and hats net.