Essay About Gen X And Threat Of New Entrants

Tiffany & Co
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EXTERNAL ENVIRONMENT
Societal Environment
1. Economy
Low-negative growth in economy/financial markets (T)
Reduced discretionary spending on goods that are, or are perceived to be, luxuries (T)
Unsettled regional/global conflicts e.g. military and/or terrorist activities (T)
Weak economic conditions in Japan (T)
Global competition (T)
Wholesale market for high quality cut diamonds will provide continuity of supply and pricing (O)
Soft employment market (T)
Post September 11th recession/reduced tourism (T)
Increase in 2-income families (O)
Number of families w/ household incomes over $100,000 to grow by 20% (O)
Low cost manufacturing abroad – China, Brazil (O)
High discretionary income of baby-boomers through credit card use (O)
2. Technology
Increased availability of Internet (O)
Increased use of E-Commerce (O)
New QAD & MFG/PRO software to collect real-time data (O)
Political-Legal
Increase in free trade (O/T)
Chinas membership to WTO (O)
WTO – World Trade Organization (O/T)
Tax benefits associated w/ ETI (O)
Government rules/regulations (O/T)
4. Socio- Cultural
Growth of seniors market-over 80 million baby boomers in U.S (O)
Baby boomers focused on luxury, travel, and leisure (O)
Trend young males 18-34 marrying later; participate in bridal/baby registry (O)
More women entering workforce (O)
Matures, by 2015, 15% of population (O)
60 million Generation Y consumers – bridal market boom (O)
bridal market boom (O)
Gen X and Gen Y focus on fashionable, trendy items (O)
Trend in high-end luxury brands desired by Chinese (O)
Consumer purchasing power and preferences (O/T)
Increase or frequency of tourist travel (O)
B. Task Environment
Threat of New Entrants: LOW
a.) Market maturity
Bargaining Power of Buyers: LOW
a)Consumers
Threat of Substitute Products: HIGH
a)Costume jewelry & cheap jewelry
Bargaining Power of Suppliers: MEDIUM
a)Diamond mines
b)New TIFFANY MARKTM watch parts purchased from single
manufacturer
c)Numerous alternative sources for gems/precious metals;
loss of any single supplier would not have material
adverse effect on operations
Rivalry Among Competing Firms: HIGH
a)Zales
b)Harry Winston
c)David Yurman
d)Oriental Gem House
e)General retail stores
f)Imitators and Counterfeiters
Power of Other Stakeholders: LOW – Shareholders
Industry globalization (O)(T)
Overseas potential in China, Brazil and Canada (O)
Emphasis on quality, durability, and value (O)
Focus on specialization (O)
Dept. store specialty boutiques to decline (O)
Highly fragmented industry (O)
Growing popularity of diamonds (O)
Fine jewelry sales up 0.7% over 2001 (O)
1/2 of U.S. households bought jewelry in 2002; 39% bought fine jewelry (O)
Purchase motivators: buying things that lasted & emotional
fulfillment (O)
Convenience trend influencing customer purchases (O)
INTERNAL ENVIRONMENT
Corporate Structure
Stage II/III Corporation – growth/maturity
Stage 3 of international development
4 Business Segments: U.S. Retail, International Retail, Direct Marketing, Specialty Retail
Corporate Culture
Commitment to proven, disciplined approach to long-term
development
Commitment to high level of quality, value, craftsmanship,
durability, and innovation
Emphasis on superb customer service
Promotion from within
Adhering to highest ethical standards of business conduct
Uncompromising commitment to product/service excellence
Responsibility to support communities
Corporate Resources
1. Marketing