A Less Snooty Tiffany Opens
By Tom Ryan
Holly Golightly wouldn’t recognize the new Tiffany location in University Village in Seattle. Instead of stainless steel, the front doors are made of glass. The store is smaller than a typical Tiffany, focuses on lower-priced items, and even allows customers to touch some of the merchandise.
Tiffany opened a similar store at the Americana Shopping Center in Glendale, California during 2008. The more relaxed vibe is designed to encourage customers — mainly women — to interact with the product.
Inside, spacing is more open and some jewelry pieces in the university location are displayed on top of tables in “organic displays” so that customers can touch them, without asking for permission. Sales associates, called “stylists,” can ring up sales with handheld cash registers, much like the staff at Apple stores. The store, at 2,100 square feet, compares with the 4000-5000 square-foot size of a typical Tiffany location.
The store also focuses less on high-end jewelry and more on lower-priced but “higher-margin” best sellers. The Glendale location originally did not stock any engagement or high-end jewelry when it opened in October 2008, but recently added a “representative engagement ring assortment” due to customer requests.
Store manager Belinda Kearns told The Seattle Times that Tiffany chose University Village as a second site for the new concept because of Seattle’s “independent spirit and sophisticated sense of style.”
Ms. Kearns added, “It’s designed to let people explore and play a little bit with their own style. I think that will fit in well with University Village. It’s one of those places where people come to linger and relax.”
Regarding the use of glass doors, she said, “Some people might be a little intimidated walking through our big stainless-steel doors. It’s just our way of being more inviting.”
Paco Underhil, founder of Envirocell, the retail consultancy, particularly applauded Tiffany’s efforts to create an environment where consumers can “play” with the merchandise, akin to an Apple store.
“The thing about Apple stores is that they’re a temple to the brand,” Mr. Underhill told The Seattle Times. “Tiffany also has the potential to do that. In the larger national jewelry scene, Tiffany is the only real brand out there with some form of mass acceptance. It’s upscale, but approachable.”
Discussion Questions: Do you think a more relaxed and less formal Tiffany’s will work without turning off the chain’s traditional customers? Does allowing shoppers to touch merchandise and having associates user handheld devices fit with Tiffany’s image?
In a previous discussion, we talked about how luxury retailers are going to have to reach out to new demos to expand or even maintain business. Tiffany has realized that they need to execute on that. I haven’t seen the new format but I must admit that while shopping for an engagment ring, a visit to the Tiffany’s in downtown Toronto was in order. Describing their current format as imposing is an understatement. I actually wonder how many customers leave because they are too scared to shop there. This new relaxed atmosphere should do well for them and attract new buying groups.
What works in Seattle (or neighborhoods within that community), might not be applicable to other geographic locations. The more casual play in Seattle is likely to be a winner. And, having consumers coming into a more moderately priced environment in the new store, provides the leverage to evolve to added, more traditional, price points that Tiffany represents based on customer demand.
Retail, because we’re operating in a “consumer-centric” environment, as opposed to a “product-centric” one, can call the shots in locations like this.
Like all well-known brands, Tiffany has an ongoing challenge to continuously evolve each aspect of the business to maintain their current core customer while building appeal to the next generation of core customers. Brands that become too identified with a single generation tend to disappear (does anyone remember Casual Corner?) as that generation’s tastes and spending changes. Every successful brand with a loyal following goes through this evolution, with varying levels of success. Talbots and Brooks Brothers are two good examples.
This is not the first time, nor will it be the last, that Tiffany has remade its persona. What they have consistently done (brilliantly in my opinion) is to focus on the emotions related to “the little blue box”. These emotions speak to all age and economic groups and allow Tiffany the ability to maintain a bridge across generations.
This is a bit tricky for Tiffany – to keep the brand’s cachet and yet extend its appeal downward. The things Tiffany is doing with the University store should make it appealing as a jewelry store, and the brand will pull the curious in to shop. If the brand extends too far, however, it will lose its distinctiveness. This always is the challenge for the upscale brands. Ultimately, the damage to the brand could be greater than the gain.
Two weeks ago I went to dinner at Blue Hill in New York City. Blue Hill is the restaurant where the Obamas dined when they were on their special date this summer. Reservations are incredibly difficult to get at Blue Hill. As each additional day is open for new reservations, it is full within minutes. Blue Hill is an expensive, up-scale, wonderful restaurant.
I wore a suit (with no tie) because it was a special occasion. There were two or three men with ties and jackets on. But by far, the most prevalent wardrobe for the men that night was jeans. Many even were wearing sneakers.
I would guess that the demographic for Blue Hill is pretty much the same as for Tiffany’s. That being said, Tiffany’s better find a more relaxed experience for their customers. It is not a matter of intimidation; it is a matter of association.
Luxury and so called aspirational brands either need to step it up or step it down when it comes to snootiness and exclusivity. I just read an article in Advertising Age about how Restoration Hardware is actually raising prices 20 to 30% to stand out from the competition and is focusing on very high end designers. The flip side are all the big ticket fashion designers who are teaming with discounters and creating lines that are cheaper and more accessible to the average consumer. What seems to be the theme here is that doing nothing is not an option.
Tiffany, like so many luxury brands in the market today, is caught between a rock and a hard place. They must attract new customers in order to generate corporate growth; all the while, they have to keep the core customers content and spending without in any way threatening their desire for the brand. No can do. In my book, Let Them Eat Cake, I explore the differences between marketing success (i.e. growth) and branding success (i.e. maintaining exclusivity, specialness, romance). Tiffany has got a fundamental challenge that won’t be easily resolved by opening a new store concept.
Personally, I applaud Tiffany for trying to bring more accessibility and openess to their brand. At the same time, selling luxury Tiffany to the masses may well jeopardize the brand with the ‘classes.’ Luxury marketers can’t serve two masters — Wall Street investors that demand growth and increased profits or high-end shoppers who want their Tiffany brand to stay exclusive and special to maintain its allure.
Tiffany is doing a very smart thing here. The unchecked proliferation of “knockoffs” has demonstrated the appeal of Tiffany merchandise to the average consumer. To protect their copyrighted designs, they need to make them more available to the public. In addition, anyone in the jewelry business knows that jewelry is a very personal purchase and easier access to the items is key – consumers like to touch and try items on. Sales will increase – without any doubt.