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Chapter_22_Tiffany_Silver - Here is an excerpt from a...

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Here is an excerpt from a January 2007 article published in the Wall Street Journal Asia : “IN THE LATE 1990S, Tiffany & Co.'s silver charm bracelet was a must-have fashion accessory. Teens jammed Tiffany's hushed stores clamoring for the $110 silver bauble. Sales skyrocketed, investors cheered. Tiffany's managers worried. […] "The large number of silver customers did represent a fundamental threat” […], says Tiffany CEO Michael Kowalski. So in a dramatic gamble, Tiffany decided to kill its golden goose.” 1
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Question 1: If making sales is a business purpose, why then Tiffany’s management worried? Question 2 : What do you think Tiffany’s management did to react to the situation described? Question 3: What do you think is Tiffany’s mission statement? Abstract (Summary) People inside the company debated the problem for months. "Some people would look at it one way and say, 'If every 16-year-old gets her silver jewelry from Tiffany, they'll eventually want their engagement ring from Tiffany 10 or 20 years later,'" says Mark Aaron, Tiffany's vice president of investor relations. But "what if some of those teenagers fill up their jewelry boxes with Tiffany silver, and as they get older, they perceive Tiffany as where they got their teenage jewelry?" At the Tiffany store in New Jersey's Mall at Short Hills, the main entrance still leads shoppers to counters housing its fine jewelry. But just aside, a private viewing room was added with a ready stock of chilled water and champagne. "We wanted to create an environment that was more intimate," says Elisabeth Ames, a Tiffany vice president. A side entrance was also added to lead "transactional" shoppers directly to the counters of Tiffany's silver jewelry. Other Tiffany stores have undergone similar renovations. Some high-end shoppers haven't yet been lured back into Tiffany stores. Barbara Graffeo has a jewelry box full of Tiffany pieces. But, she says, "I don't wear them anymore because everyone wears them now." The 46-year-old owner of a New York apparel company adds, "You used to aspire to be able to buy something at Tiffany, but now it's not that special anymore." » Jump to indexing (document details) Full Text (1837 words) (c) 2007 Dow Jones & Company, Inc. Reproduced with permission of copyright owner. Further reproduction or distribution is prohibited without permission. IN THE LATE 1990S, Tiffany & Co.'s silver charm bracelet was a must- have fashion accessory. Teens jammed Tiffany's hushed stores clamoring for the $110 silver bauble. Sales skyrocketed, investors cheered. 2
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Tiffany's managers worried. They knew the bracelet had become a fad, one that could alienate the jewelry firm's older, wealthier, and more conservative clientele. Worse, it could forever damage Tiffany's reputation for luxury. "The large number of silver customers did represent a fundamental threat -- not just to the business but to the core franchise of our brand," says Tiffany CEO Michael Kowalski.
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