Editors

What Tiffany’s Acquisition Means for the Jewelry Industry

EditorsDec 09, 2019

What Tiffany’s Acquisition Means for the Jewelry Industry

Looking at what makes Tiffany & Co. worth $16 billion says a lot about what consumers value, Associate Editor Lenore Fedow writes in her analysis of the deal.

20191209_Tiffany_rings.jpg
A “Tiffany Setting V” band ring , a “Tiffany True” engagement ring, a “Tiffany Soleste” band ring, and a “Tiffany T True” narrow ring. Luxury conglomerate LVMH is set to acquire the well-known jeweler in a deal valued at $16.5 billion. (Photo credit: Tiffany & Co.)

Life as the resident retail reporter at National Jeweler can be a bit of a bummer.

It’s an unofficial and self-bestowed title, but if stores are closing or companies are going bankrupt, I tend to cover it.

Truly, I like my beat. I do my best work when I’m elbow-deep in quarterly reports and court documents.

But when the rumors of LVMH’s acquisition of Tiffany & Co. began to fly, I felt a bit uneasy.

As a lifelong New Yorker, I have a soft spot for Tiffany. My everyday jewelry, the pieces I consider a part of me, all came in a little blue box.

I see the company as an American icon and quintessentially New York, and I wasn’t sure how to feel about a French luxury conglomerate buying it.

As a reporter covering retail, I mulled over what the deal would mean for Tiffany and, more broadly, for the jewelry industry at large.

So I picked the brains of experts and analysts, and I’ve come to you with my findings.

Here’s what makes Tiffany so valuable and why those factors matter to the overall industry.

Tiffany brings a strong brand to the table.

Amid reports of a potential acquisition, Tiffany confirmed in October it had received an unsolicited bid from LVMH for $120 per share, valuing the company at $14.5 billion.

After talks with LVMH, Tiffany reportedly asked the company to up the bid to $130, believing the company was worth more.

And Tiffany was right. The final deal was for $135 per share, or $16.2 billion, one of the largest transactions in LVMH’s history.

Tiffany was able to command big bucks, in part, because of the strength of its brand.

Flavio Cereda, an equity analyst at Jeffries, stated in a note written prior to the deal that Tiffany’s “brand equity and the strength of the image of its iconic 1837 Blue Box are more valuable than the current financials suggest.”

“LVMH, with all its brands, does not have a strong, solid diamond jewelry brand like Tiffany or that caters to Tiffany’s clientele,” industry analyst Edahn Golan wrote in an email to National Jeweler.

LVMH’s watch and jewelry portfolio consists of Chaumet, Bulgari, Fred, Hublot, TAG Heuer, and Zenith.

“Of the six companies in LVMH’s watch & jewelry group, only Chaumet is a diamond jewelry company, which means that the group has a lot of room to grow,” he said.

From its trademark Tiffany Blue color to the white ribbon around its

boxes, Tiffany’s strong brand presence is a valuable asset.

The rise of brands was a major takeaway from De Beers’ 2019 Diamond Insight Report, which noted the popularity of branded jewelry, particularly in the diamond engagement ring space.

Branded jewelry represents two-fifths of sales of commitment jewelry in the United States, said De Beers.

The report also highlighted the resonance of brands with same-sex couples and millennials.

Tiffany’s vertical integration is valuable.

“Tiffany checked all the boxes,” industry analyst Paul Zimnisky said in an interview with National Jeweler Friday, noting that while the standalone brand was the most important aspect of the deal, its vertical integration is certainly the second.

Luca Soltani, senior research analyst for luxury goods at research firm Bernstein, echoed Zimnisky’s sentiment on vertical integration.

“It is clearly an advantage—especially when we look at the bridal products,” Soltani said in an email to National Jeweler.

Zimnisky wasn’t surprised by the acquisition, as rumors had been swirling in the space for a while, but said he was surprised LVMH didn’t make a bid last year during the stock market sell-off.

Then again, “not a lot of acquisitions could move the needle for them,” he said, noting the size and wealth of the luxury conglomerate.

LVMH has the money to spend, but what it lacks are the sourcing and manufacturing connections that Tiffany maintains.

LVMH Chief Financial Officer Jean-Jacques Guiony said as much in a conference call with analysts following the deal, highlighting Tiffany’s “very high level of vertical integration, compared with our brands.”

“[Tiffany] realized early on that vertical integration will give it better access to the goods it needs, and at better prices too,” said analyst Golan.

The company’s vertical integration efforts began 20 years ago, Tiffany CEO Alessandro Bogliolo said in an interview with Bloomberg.

Tiffany established Laurelton Diamonds, a wholly owned manufacturing subsidiary, in 2002.

It’s a De Beers sightholder and has inked long-term rough supply agreements with Alrosa and Dominion Diamond.

Bogliolo noted that 80 to 90 percent of its polished diamonds above 0.18 carats come from its workshops.

Tiffany also holds a stake in a diamond mine in South Africa owned by Canadian mining company Diamcor, a company spokesperson confirmed.

At a time when provenance and supply chain transparency are becoming increasingly important to consumers, Tiffany is ahead of the curve.

The jeweler began telling consumers the origin of its diamonds in January through its “Diamond Source Initiative.”

In that same Bloomberg interview, Bogliolo estimated the move toward sustainability cost Tiffany tens of millions of dollars over the years but added that it differentiates Tiffany from other jewelry companies.

“The reason why we are so selective with our sourcing is to avoid either mines that are not compliant with safety requirements, environmental protection, [and] human rights respect,” he said.

Tiffany, for example, does not source from Zimbabwe or the Congo due to internal issues in the countries, even if the diamonds meet Kimberley Process standards, he said.

“Tiffany is a very big player in all sorts of diamonds, and it’s something where the sourcing is not easy to do, and we expect to benefit from that,” LVMH’s Guiroy said on the call.

Tiffany boarded the sustainability train early.

With Tiffany’s vertical integration comes its ability to have a greater say in the means of production, a valuable asset at a time when climate change and environmental issues are weighing heavy on the minds of many consumers.

The younger, affluent generation are socially and environmentally conscious and hold luxury brands to high standards, particularly sustainable and ethical production processes, said Deloitte in its Global Powers of Luxury Goods 2019 survey.

“This implies an important lesson for luxury brands that want to retain these customers: they need to evolve towards new models of ethical and sustainable luxury.”

In addition to its diamond sourcing standards, the jeweler has been mindful of metals.

A decade ago, Tiffany was the first jewelry company to speak out against the development of the never-built Pebble Mine in Alaska’s Bristol Bay, holding a screening of a documentary about the importance of the watershed, “Red Gold,” in New York.

It was one of the first jewelers to use gold sourced from the “Salmon Gold” initiative, which aims to mine gold in a way that’s mindful of the habits of salmon and other fish.

The Deloitte study highlights Tiffany’s responsible sourcing as well as its social and environmental work, particularly its philanthropic foundations focusing on reef conservation and awareness for responsible mining.

Tiffany created its “Save the Wild” collection in 2017, donating all profits, totaling more than $5 million, to the Wildlife Conservation Network.

And the company’s over-the-top holiday catalog offers an 11-day safari in Kenya and a set of animal-shaped diamond brooches, with a portion of the proceeds going to the animal conservation charity.

Tiffany is doing well in a key market—China.

Luxury brands across the board are grappling with U.S.-China trade tensions. Simultaneously, political unrest in Hong Kong is weighing heavy on balance sheets.

Tiffany, however, is still seeing double-digit growth in mainland China and highlighted higher spending by locals in its third-quarter results.

The jeweler currently has 35 stores in mainland China and 10 in Hong Kong.

LVMH’s third-quarter results also reported strong growth in Asia, and it has a strong enough foothold in the country to propel Tiffany even further in the growing market.

Jefferies analyst Cereda said LVMH may leverage the strength of Tiffany’s brand to target the Asian millennial market.

“I could definitely see that happening,” said Reginald Brack, executive director at NPD and an industry analyst on watches and luxury, in an interview with National Jeweler Friday.

“I think that Asian millennial luxury consumer is what most luxury brands now are trying to target. Tiffany is well-poised and positioned to capitalize on that with their immense brand recognition.”

The future of Tiffany may mean fewer stores.

Cereda noted Tiffany’s move into China may mean a “rethinking of the current product mix and its U.S. footprint.”

Bernstein analyst Soltani said Tiffany’s position in the United States is a strength, but that perhaps, “LVMH would want to upgrade the Tiffany flagship stores, and streamline the rest of the retail network.”

Tiffany’s flagship New York City store will undergo renovations after the holiday, and the retailer will move the store into a temporary, nearby space until it’s completed.

He said in secondary locations, Tiffany could “use a lighter (and smaller) retail format.”

NPD analyst Brack had the opportunity to visit a new Tiffany concept store in Tokyo, which he described as an “industrial loft space” that included a permanent DJ booth.

He said the items were more accessible, out there in the open to touch, and the space had a personalization bar.

An openness to change in an ever-changing retail environment is critical and when you have a strong brand, you can afford to experiment a little.

This deal speaks to the industry at large.

What I’ve taken away from my discussion with experts and analysts is this: Looking at what makes Tiffany worth $16 billion says a lot about what consumers value.

To compare Tiffany with independent jewelers is incongruous in some respects but, overall, understanding what matters to the customer is vital to any business.

Tiffany has: a strong brand, control of aspects of production, a focus on responsible sourcing and sustainability, and an eye for the retail experience.

Whether upping your social media game or talking more with your customers about the journey their jewelry has taken, you can take away something actionable from this historic deal.
Lenore Fedowis the senior editor, news at National Jeweler, covering the retail beat and the business side of jewelry.

The Latest

Brilliant Earth Jolie Mosaics engagement ring
FinancialsAug 08, 2025
Brilliant Earth’s Q2 Sales Up 3% as Engagement Ring Sales Rise

The company raised its full-year sales guidance while noting it has not yet assessed the potential impact of the latest tariff news.

Jewellers for Hope charity event
Events & AwardsAug 08, 2025
GJEPC’s Jewellers for Hope Celebrates 10 Years of Fundraising

The organization has raised more than $1.3 million for charity since its inception.

Rahaminov Diamonds Emerald-Cut Diamond Bezel Bangle
TrendsAug 08, 2025
Piece of the Week: Rahaminov Diamonds’ Bezel Bangle

The brand’s latest iteration of a bezel-set diamond bangle features clean lines and a timeless design for a new modern silhouette.

rio-article photo-diamond.jpg
Brought to you by
Taking the Moment Head On: How Rio Grande Champions the Present & Future of Fine Jewelry

As a leading global jewelry supplier, Rio Grande is rapidly expanding and developing new solutions to meet the needs of jewelers worldwide.

Black and white photo of Tony Bennett near a microphone
WatchesAug 07, 2025
Bulova’s New Collection Honors Tony Bennett

The first watch in the series commemorates his participation in the Civil Rights movement, marching from Selma to Montgomery in 1965.

Weekly QuizAug 08, 2025
This Week’s Quiz
Test your jewelry news knowledge by answering these questions.
Take the Quiz
Sapphire page in Chatham’s “Ultimate Lab-Grown Catalog”
Lab-GrownAug 07, 2025
Chatham Releases Catalog for Loose Lab-Grown Gemstones

The catalog contains a complete listing of all the loose gemstones in stock, as well as information about the properties of each stone.

Rembrandt Blue Jay, Hummingbird, Cardinal Bird Charms
TechnologyAug 07, 2025
Rembrandt Charms Debuts New Website, Bird Charms

The company added a retailer dashboard to its site and three new birds to its charm collection, the cardinal, blue jay, and hummingbird.

an instructor and a student in a bench jewelry classroom
Brought to you by
Investing in the Next Generation of Bench Jewelers

The Seymour & Evelyn Holtzman Bench Scholarship from Jewelers of America returns for a second year.

Shipping containers on a ship
Policies & IssuesAug 06, 2025
Tariff on India to Rise to 50%, Trump Says

An additional 25 percent tariff has been added to the previously announced 25 percent.

Claire’s storefront
MajorsAug 06, 2025
Claire’s Files for Chapter 11 Bankruptcy Again

The jewelry and accessories retailer plans to close 18 stores as part of the proceedings.

Smith & Son Jewelers storefront Springfield Massachusetts
IndependentsAug 06, 2025
Smith & Son Jewelers to Close 107-Year-Old Location

Its Springfield, Massachusetts, store is set to close as owner Andrew Smith heads into retirement.

Zahn-Z Beluga Spout Grey Spinel Ring and Beluga Spout Mandarin Garnet Ring
CollectionsAug 06, 2025
Zahn-Z Swims With Whales in ‘Beluga’ Collection

Designer Hiba Husayni looked to the whale’s melon shaped-head, blowhole, and fluke for her new chunky gold offerings.

Paola De Luca presenting Trendbook 2026+ at Vicenzaoro
TrendsAug 06, 2025
Paola De Luca to Release Trendbook 2027+

She will present the 23rd edition of the trend forecasting book at Vicenzaoro on Sept. 7.

Omar Roy mugshot
CrimeAug 05, 2025
Report: Suspect Arrested in 1992 Murder of Miami Jeweler

Omar Roy, 72, was arrested in connection with the murder of jeweler Dionisio Carlos Valladares.

Mignon Faget Beyond Katrina Pendant and Beyond Katrina Pin
CollectionsAug 05, 2025
Mignon Faget Commemorates 20th Anniversary of Hurricane Katrina

The New Orleans-based brand’s “Beyond Katrina” jewels honor the communities affected by the storm.

National Jeweler columnist Lilian Raji
ColumnistsAug 05, 2025
The PR Adviser: Affiliate Marketing Is the Cost of Coverage

Lilian Raji explains why joining an affiliate network is essential for brands seeking placements in U.S. consumer publications.

Jewelers of America Logo
Events & AwardsAug 05, 2025
JA Announces Seymour & Evelyn Holtzman Bench Scholarship Winners

The organization has awarded a total of $42,000 through its scholarship programs this year.

2026 Gem Awards logo
Events & AwardsAug 04, 2025
Gem Awards, David Yurman Introduce $50K Grant for Emerging Designers

The winner of the inaugural David Yurman Gem Awards Grant will be announced live at the 2026 Gem Awards gala.

Marlo Laz peridot and diamond Alexandra earrings
TrendsAug 04, 2025
Amanda’s Style File: August’s Bright Baubles

As summer winds down, celebrate the sunny disposition of the month’s birthstones: peridot and spinel.

Surveillance image of Watch King robbery suspect
CrimeAug 04, 2025
‘The Watch King’ Assaulted, Robbed in Queens

Moshe Haimoff, a social media personality and 47th Street retailer, was robbed of $559,000 worth of jewelry by men in construction outfits.

Xavier Dibbrell
MajorsAug 04, 2025
Borsheims Welcomes New Assistant Facilities Manager

Xavier Dibbrell brings more than a decade of experience to the role.

Signet Jewelers logo
MajorsAug 01, 2025
Helzberg President Julie Yoakum Moves Over to Signet Jewelers

The addition of Yoakum, who will lead Kay and Peoples, was one of three executive appointments Signet announced Thursday.

Mike Alexander
MajorsAug 01, 2025
Jewelers Mutual Names Mike Alexander as President

The insurance company’s previous president and CEO, Scott Murphy, has split his role and will continue as CEO.

 Gemfields rough rubies
SourcingAug 01, 2025
Gemfields’ Auction Revenue Drops 50% in H1

The nearly six-month pause of operations at its Kagem emerald mine earlier this year impacted the miner’s first-half results.

Hernsdorf Tears of Aphrodite Necklace
CollectionsAug 01, 2025
Piece of the Week: Hernsdorf’s ‘Tears of Aphrodite’ Necklace

The necklace uses spinel drops to immortalize the moment Aphrodite’s tears mixed with her lover Adonis’ blood after he was fatally wounded.

Stock image of a polished diamonds being held by tweezers
SourcingJul 31, 2025
De Beers Records $189M First-Half Loss

The diamond miner and marketer warned last week that it expected to be in the red after significantly cutting prices in Q2.

Lindsey Scoggins Studio convertible flower earrings
Events & AwardsJul 31, 2025
These Are the 2025 CASE Award Winners

Jewelers of America’s 35th annual design contest recognized creativity, artistry, style, and excellence.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy