News service Reuters reports that LVMH held a “town hall” meeting for Tiffany & Co. employees in January, in which management outlined a shift in focus toward “high-end, sparkling jewellery” and away from affordable, sterling silver product lines.
In a video message broadcast at the meeting, LVMH chairman and CEO Bernard Arnault said, “We will also prioritise Tiffany’s long-term desirability over short-term constraints.”
Arnault recently appointed his son Alexandre Arnault – former CEO of LVMH-owned luggage brand Rimowa – as Tiffany’s executive vice-president of product and communication, working alongside new CEO Anthony Ledru, a former executive at fashion house Louis Vuitton.
Ledru, in particular, seems uniquely placed to reposition Tiffany & Co. as a more exclusive luxury brand having previously held senior positions at Harry Winston and Cartier.
Notably, Tiffany & Co. has recently purchased an 80-carat D colour internally flawless diamond, which it intends to to set in the most expensive necklace it has ever produced for sale. A spokesperson for Tiffany confirmed the final price will be in "within the eight-figure range”, or more than $US10 million.
Reuters also quoted several sources close to Tiffany & Co. as saying the company’s more than 300 stores would undergo renovations – in particular those located in the US, which is Tiffany & Co.’s largest market.
Its Manhattan flagship store closed for renovations last year and is scheduled to be completed in 2022. The necklace is likely to be unveiled at the same time.
One source told the news service, “LVMH can give Tiffany the kind of time and money needed to make some big investments in the product range and in stores worldwide, and wait for those to pay off in the medium term.”
LVMH will also expand Tiffany & Co.’s presence in Europe and China, the report states.
While Tiffany & Co.’s full-year earnings will no longer be made publicly available, the company’s revenue totalled $US4.4 billion in 2019. Its most recent financial report, published in November 2020 and covering the first nine months of the year, noted that revenue had fallen by approximately 25 per cent due to the impacts of the COVID-19 pandemic.
This indicates its total revenue for the year would have been approximately $US3.3 billion, roughly equal to that of LVMH’s existing Watches & Jewellery Division, which includes Bulgari, Chaumet, Fred, Tag Heuer, and Zenith.
The division recorded revenue of EUR3.4 billion in 2020, representing 7.5 per cent of the LVMH Group’s total revenue and a decline of 24 per cent from the previous year.
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