Costco vs Tiffany
brand-as-business bit: The power of distinctive brand positionings jumped off the page of a recent BusinessWeek write-up about Costco getting sued by Tiffany & Co. for selling “Tiffany” diamond engagement rings.
The article suggested Costco customers are pragmatic and deal-driven (“People who can spend [$40,000] on a piece of jewelry aren’t usually the sort to accessorize at Costco. Yet some are the type who can’t resist a good deal.“) — and not too discriminating. One customer reported “Costco’s diamonds were above and beyond what we could afford elsewhere…For the price we paid, I don’t care where it came from.” But apparently another (Tiffany’s?) shopper makes purchase decisions with other considerations in mind, saying “she thought about shopping for rings at Costco, but ‘I was concerned everyone would ask where we got the ring.‘”
An industry analyst provided a succinct contrast between the two brands’ customer experiences. “If you want someone to present the diamond on a pretty cushion and have the box from a prestigious brand, then you’re paying a premium for that experience. Or you can have someone swipe your credit card, hand you a diamond, and tell you to get out. Your choice.”
The article’s final note acknowledged that the brand value is based on far more than the product alone. “Costco rings don’t come with perks such as free cleanings, and they’re packaged in a red and beige box instead of the genteel Tiffany blue. Costco doesn’t even resize rings for customers. But it does sell bouquets and corsages in bulk.”
I love that we live in a world where two such different brands co-exist — and each can thrive!