The case for an accessible“real” jewelry line

Geneva, May 2009

2

Bling is out. Luxury can no more be just equalto excess

3

Today luxury is a function of prestige which isa function of the awareness of the brand

4Awareness it is very very costly to build upand is (almost) the opposite of exclusivity

5Possibly the ultimate commodity. How do youdifferentiate your jewelry offering?

6

Possible approach: differentiate via boldness,but of a sort to which it’s easy to connect

7

Define luxury as standing out, not as fitting in

8Luxury is not the opposite of poverty. It is theopposite of vulgarity.

9The costliest is not the coolest

10

Which one will be the symbol of ultimatecoolness in 2015?

Some very prestigiousbrands were built oncompelling affordability

12

5£ bag = instant icon?

“Affordable luxury shopping” concepts haverevolutionized retail

The third most respected brand in Germany

15More and more rich women love this stuff

16

“Trade” metal value and craftsmanshipagainst affordability, glamour and design

High

Low

Price “Visual”glamour

Value ofmaterials

Creativity,design

content

“Craft-manship”content

Awareness ofbrand*

“Traditional”branded jewelry

Bigproblem:how doyou pullthis up?

Affordable, “real”,jewelry

* Hypothesis: new entry in market

17

Ride the statement jewelry trend

It's big. It's bold. It's sparkly. It's everywhere. It'sstatement jewelry. If there is one accessory topurchase this season, it is a bold statementnecklace

Stylelist.com

This season (2007) let your accessories do allthe talking with a show-stopping piece ofstatement jewellery

Elle

In jewellery big is beautiful. All you need is onebig statement

Stylefinder.com

Statement jewellery is this season's must-have.

Daily Mail2008 will be all about wearing less jewelry - butbeing bolder and more unique. The biggerand bolder, the better . As long as you leavethe boring stuff at home who really cares?

Fashionising.com

Statement jewellery has arisen to a new levelof significance for 2009

Fashionising.com

With bold accessories back in vogue, Chloéhits the mark with its statement jewellery line

Ellestyle

Standout jewels can really make an outfitFabsugar.com

Statement jewellery is big this seasonFashionclicks.co.uk

Just one piece of jewelry - one that adds asignificant dose style to your ensemble - isoften a really good strategy

Foreverchic.blogspot.com

The Modern Opulence trend: jewels can neverbe too big or too fabulous. Rock out with yourjewels - its a costume ball after all!

Net-a-porter.com

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Hip = “keenly aware about the latest trendsand very stylish*”

“Luxurious, glamorous, creative,

jewelry at an affordable price”

A silver piece is “affordable”only if it provides a

compelling customer offer(is perceived as hip “real”

jewelry)

The desirability of the silverpieces also depends on the

credibility of the price points ofthe gold and diamonds

versions, and on theirperception as “dream

jewellery”

Customers should be happyto “trade” metal value and

craftsmanship againsthipness

”Real luxury”perception dependson brand awareness

and on peeracceptance

* Merriam-Webster Dictionary of the English language

19

Tiffany: gold and diamond versions“legitimize” accessible silver collection

20

Tiffany’s offers silver, gold and diamond-encrusted bracelets…

0 €

1'000 €

2'000 €

3'000 €

4'000 €

5'000 €

6'000 €

7'000 €

Return toTiffany

Atlas 1837 Cushion Somerset Notes Signature PalomaPicasso

Elsa Peretti FrankGehry

Number ofreferences

14 4 25 6 16 4 11 17 36 19

4 4 4 1 10 2 2 5 30 5

Silver

Gold

Silver

Gold

Source: Tiffany.com , refers only to pieces sold on line

21

Frank Gehry Fish bracelet

Paloma Picasso

Loving Heart bracelet

Paloma Picasso

Loving Heart pendant

Elsa Peretti Bean chain

Elsa Peretti Open Heart

chain

Frank Gehry Fish bangle

Frank Gehry Fish pendant

…priced using widely different “multiplier”ratios

Source: Tiffany.com, refers only to pieces sold on line

Paloma Picasso Zellige earrings

Signature earrings

Elsa Peretti Snake

necklace

Frank Gehry Fish pendant

Atlas charm bracelet

Elsa Peretti Aegean necklace

Paloma Picasso Calife

bangle

1887 lock pendant

0.4 1.7 0.2 0.9 2.0 0.1 0.1 0.1 0.4 0.2 1.5 0.4 0.7 0.1 0.1

0 x

1 x

2 x

3 x

4 x

5 x

6 x

7 x

8 x

9 x

10 x- - 1.3 - - 1.5 1.0 3.3 - 14.9 - - - 1.9 -

0.5 3.5 0.5 2.2 5.1 0.4 0.4 0.6 2.2 1.4 8.9 2.4 4.5 0.8 1.1

1.3 = Price of diamond version (€ x 1000)

0.5 = Price of gold version (€ x 1000)

0.2 = Price of silver version (€ x 1000)

22

82%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0 € 200 € 400 € 600 € 800 € 1'000 € 1'200 € 1'400 € 1'600 € 1'800 €

20% of the pieces over the 500€ mark, andmost collections offering pieces < 300€

Source: Tiffany.com, refers only to pieces sold on line

500 €

Elsa PerettiFrank GehryPalomaPicassoSignatureSomerset1837Return to TiffanyOther Tiffany

151 =

My objective is to designaccording to one'sfinancial possibilities

Elsa Peretti

23

0 €

500 €

1'000 €

1'500 €

2'000 €

2'500 €

3'000 €

Return toTiffany

Atlas 1837 Cushion Somerset Notes Signature PalomaPicasso

Elsa Peretti FrankGehry

14 11 24 2 3 6 1 35 115 46

Silver necklaces follow a similar pattern asbracelets, with some pricier designer pieces

Number ofreferences

Source: Tiffany.com, refers only to pieces sold on line

24

Example: Tiffany by Elsa Perretti collection

Source: Tiffany.com, refers only to pieces sold on line

Elsa PerettiAegeannecklace,20’’, gold8.940 €

Elsa PerettiAegeannecklace,20’’, silver1.470€

Elsa Perettismall Bean,16’’ chain,pavé diamondsset on platinum3.280 €

Elsa Perettismall Bean,16’’ chain,gold630 €

Elsa Perettismall Bean,16’’ chain,silver 130 €

Elsa Perettilarge Open Heart,18’’ chain,pavé diamonds seton platinum14.900 €

Elsa Perettilarge OpenHeart,30’’ chain,gold1.400 €

Elsa Peretti smalllarge OpenHeart,30’’ chain,silver240 €

Elsa PerettiSnake necklace,20’’,gold5.150 €

Elsa Peretti smallSnake necklace,20’’,silver1.970 €

25

Example: Tiffany by Frank Gehry collection

Source: Tiffany.com, refers only to pieces sold on line

Frank GehryFish bracelet,7.25’’,gold3.550 €

Frank GehryFish bracelet,8.5’’,silver1.700€

Frank GehryFish pendant,16’’ chain,diamonds seton white gold1.950 €

Frank GehryFish pendant,16’’ chain,gold801 €

Frank GehryFish pendant,16’’ chain,silver 120 €

Frank GehryFish pendant,16’’ chain,diamonds set onwhite gold970 €

Frank GehryFish pendant,16’’ chain,gold443 €

Frank GehryFish pendant,16’’ chain,silver95 €

Frank GehryFish bangle,medium,gold2.400 €

Frank GehryFish bangle,medium,silver390 €

26

Example: Tiffany by Paloma Picassocollection

Source: Tiffany.com, refers only to pieces sold on line

PalomaPicasso LovingHeartbracelet, 7’’,gold2.230 €

PalomaPicasso LovingHeartbracelet, 7’’,silver900€

Paloma PicassoLoving Heartpendant,16’’ chain,diamonds seton platinum1.500 €

PalomaPicasso LovingHeartpendant,16’’ chain,gold450 €

PalomaPicasso LovingHeartpendant,16’’ chain,silver110 €

Paloma PicassoCalife bangle,gold4.470 €

Paloma PicassoCalife bangle,silver670 €

Paloma PicassoZellige earrings,small,gold540 €

Paloma PicassoZellige earrings,small,silver350 €

27

Example: Tiffany by Tiffany collections

Source: Tiffany.com, refers only to pieces sold on line

Atlas linecharmbracelet, 6,75’’,gold2.200 €

Atlas linecharmbracelet, 6,75’’,silver410€

Atlas linebangle,mediumgold2.310 €

Atlas linebangle,diamonds set onwhite gold5400 €

1887 linelock pendant,16’’ chain,gold1110 €

1887 linelock pendant,16’’ chain,silver140 €

Signature lineearrings,diamonds set onwhite gold1.300 €

Signature lineearrings,gold 480 €

Signature lineearrings,silver220 €