Tiffany & Co. banks on its Fifth Avenue flagship, but will have to balance its legacy with the future of jewelry retail for long-term survival.

What happened

  • Tiffany has recently made a few strides in order to stay top-of-mind to consumers and expand its customer base. It launched the Blue Box Cafe in fall 2017, whose 40 seats can conjure waitlists upward of 1,000, and debuted a jewelry collection called Paper Flowers in May 2018 to cater to a younger demographic. It also has ramped up ecommerce, selling on Tmall via Alibaba, Net-a-porter.com, Farfetch.com and its own site. Now the company is announcing it will invest at least $250 million into its 78-year-old flagship store on Fifth Avenue—the same one featured in the iconic scene in “Breakfast at Tiffany’s.”

Why it matters

  • More than 90% of Tiffany & Co.’s revenue still stems from its 320 brick-and-mortar stores—a key factor in renovating the flagship location, which accounts for 10% of the company’s annual net sales. Though it has already commissioned A$AP Ferg and Elle Fanning to remix “Moon River,” a theme in “Breakfast at Tiffany’s,” it’s the in-store changes as opposed to the marketing of the flagship that will determine how Tiffany fares in the long run. Playing into its 181-year-old legacy and cinematic touchstones is part of the battle, but addressing what shopping trends and consumer interests will look like ten to 20 years down the line will determine the success of the renovation, much in the same vein as FAO Schwarz.
  • Brick-and-mortar gives Tiffany’s an indisputable advantage when it comes to sales—so far Tiffany’s CEO Alessandro Bogliolo says he’s pulling ideas from theaters and airports for lessons on how to move throngs of people through small patches of real estate—he doesn’t want customers to have to wait in line to try on jewelry. Pulling from other industries—especially those that focus on the experiential such as theme parks and sports venues—could help Tiffany & Co. innovate for the next era.