Hwdc Slideshow2.0

HARRY WINSTON DIAMOND CORPORATION

Sarah Fisher, Natalie Gash, Erica Shadford

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Agenda

Introduction of Company

Situation Analysis

Corporate Strategy

Business-Level Strategy

AGENDA COMPANYINTRODUCTION

SITUATIONANALYSIS

CORPORATESTRATEGY

BUSINESS-LEVELSTRATEGY

THANK YOU

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Founded in 1932 as Harry Winston Inc.Became Harry Winston Diamond Corporation in 2006The world’s largest publicly traded pure diamond company40% interest in Canada’s Diavik Diamond Mine


SITUATIONANALYSIS

CORPORATESTRATEGY


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New York City acts as a major inspiration for the companyThe invention of modern couture jewelleryThe “King of Diamonds”Pure stone philosophy


SITUATIONANALYSIS

CORPORATESTRATEGY


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Situation Analysis

TechnologyPopularity of Online Shopping

EconomicDecreased Consumer ConfidenceDecreased Disposable IncomeIncreased Unemployment

Macro Environment


SITUATIONANALYSIS

CORPORATESTRATEGY


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Situation Analysis

Socio-CulturalIncrease in Aging PopulationDeclining Marriage Rates

Political/LegalKimberley Process Certification Scheme

Macro Environment


SITUATIONANALYSIS

CORPORATESTRATEGY


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Situation AnalysisIndustry Environment


SITUATIONANALYSIS

CORPORATESTRATEGY


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US Dollars 2006 2007 2008

Total Revenue $528, 432, 024.51

$553,016, 741.06

$785, 818, 114.57

Number of Employees

78, 638 78, 638 78, 638

Return on Assets

2.8% 3.5% 4.1%

Return on Equity

5.7% 13.4% 7.0%

Situation Analysis

Strategic Group Map

Harry Winston’s position against its competitors has been ranked on image and perceived quality versus online presence


SITUATIONANALYSIS

CORPORATESTRATEGY


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Industry Environment

Situation Analysis

Porter’s Five Forces Rating (1-10)

Direct Competition 8/10

Threat of Entry 5/10

Threat of Substitutes 4/10

Power of Suppliers 3/10

Power of Buyers 7/10

TOTAL 5.4/10

5 Forces Analysis


SITUATIONANALYSIS

CORPORATESTRATEGY


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Industry Environment

Situation AnalysisPrimary Value Creating Activities

Supply Chain ManagementMining & ExplorationRough diamond sortingManufacture & handcrafting

Operations & DistributionExisting retail strategyFew Salons and High Revenue19 Salons in 4 regions , 150 distribution affiliates in 7 regions


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CORPORATESTRATEGY


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Marketing & SalesCore CompetencyStrongly Developed Brand EquityGreat Use of Publicity, Not Mass MediaCelebrity Endorsement


SITUATIONANALYSIS

CORPORATESTRATEGY


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Customer ServiceCompany WebsiteCustomer Support


SITUATIONANALYSIS

CORPORATESTRATEGY


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Situation AnalysisSecondary Value Creating Activities

Research & DevelopmentNew Product Lines

Corporate LeadershipMarket ValueNormalized Financials


SITUATIONANALYSIS

CORPORATESTRATEGY


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Corporate Strategy

Diavik will Reach Maximum Production in 2023

The Corporate and Retail Websites are not Complementary

Expansion of Salon Network

Corporate Strategy Challenges


SITUATIONANALYSIS

CORPORATESTRATEGY


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Corporate Strategy

Maintain Partnership with Rio Tinto and Monitor the Availability of New Shares

Strengthen the Synergy between Corporate and Retail Websites

Continue Focused Differentiation and using Global Strategy to become More Flexible to Serving Emerging Markets

Corporate Strategy Recommendations


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CORPORATESTRATEGY


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Business-LevelStrategy

Poor Online Development and Distribution through Online Sales

Leveraging the Excitement of the Brand While Focusing on the Correct Age Group

Inadequate Customer Service

Business-Level Strategy Problems


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CORPORATESTRATEGY


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Business-LevelStrategyBusiness-Level Recommendations

Website Re-launch

Launch a Line of Sunglasses to Increase the Excitement of the Brand

Improved Online Post-Purchase Relationship


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Business-LevelStrategy

Time Where Action

Short Term March 2010

2010 Oscars Website Re-Launch with Increased Capabilities and Information about Upcoming Sunglass Launch

Medium TermFall 2010

Fall Fashion Week, New York City

Launch Sunglass Prototypes

Long TermSpring 2011

All US retail Salons

Launch Sunglasses in Salons

Business-Level Strategy Implementation


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CORPORATESTRATEGY


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Business-LevelStrategyBusiness-Level Action Plan

Projected Net Profit

Revenue $ 7, 000, 000

Expenses

Retail Selling, General and Administrative Expenses

$ 3, 360, 000

Labor 300, 000

Manufacturing 100, 000 3, 760, 000

Net Profit $ 3, 240, 000


SITUATIONANALYSIS

CORPORATESTRATEGY


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Thank You


SITUATIONANALYSIS

CORPORATESTRATEGY


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Why Sunglasses?

Driving forces:The Aging PopulationGrowing Awareness of UV EffectsA Push for Stylish Frames

The market value of sunglasses in the US is growingThe premium sunglass market internationally is growing rapidly

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Prescriptions?

Sales of non prescription sunglasses in the US have been slowly declining since 2000Offering prescription and nonprescription, WHY?

Harry Winston’s target market is 45-65 with high disposable income and can afford laser eye surgeryTo accommodate the increase in prescription sunglasses Harry Winston would offer both

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Financials

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Harry Winston Income Statement

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