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The Tiffany & Co. flagship store on 5th avenue alone generates as much revenue as all of Pinterest. So reports John Stoll in The Wall Street Journal. Such a piece of evidence should help everyone understand that the idea that brick and mortar stores are dead is a fallacy. Most shopping is still done face to face, and despite the rapid and impressive growth of e-commerce, many people still enjoy seeing the products they’ll buy in person before purchase. Stoll explains how, instead of accepting defeat, Tiffany is revving up its New York flagship store with a $250 million investment. He writes:
In an internet age, why are companies pouring so much money into brick-and-mortar shops? Because the customers are still coming.
The famous Tiffany building on the corner of 5th Avenue and 57th Street, where Audrey Hepburn’s Holly Golightly mused “nothing very bad could happen to you” in 1961, may be the most enduring example of what retailing looked like before the Internet arrived.
So it’s striking that the Tiffany TIF -0.37% & Co. of 2018, faced with an onslaught of online commerce, is responding by making a big bet on that old store. It’s investing as much as $250 million in the 78-year-old flagship.
It turns out that all over the ravaged retailing sector, companies are rethinking the mantra that the future is digital, and pouring money into actual brick-and-mortar stores.
Representing as much as 10% of the company’s $4.2 billion in annual net sales, the flagship pulls in as much revenue as Pinterest.
Tiffany lives and dies by the performance of 320 stores that deliver more than 90% of the company’s revenue. “It’s a magic place where as a customer you want to have an experience that is extraordinary,
Now is not the time to give up on making stores better.
For proof, look no further than a new cafe that Tiffany opened at the flagship, which is painted in the familiar blue hue that dresses jewelry boxes. It accommodates about 40 people at a time. On Wednesday(recent), more than 1,000 people sat on a internal waiting list hoping that a reservation would open up.
Read more here.
Dick Young
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