Why a $6,000 Briefcase Is Key to Tumi's Strategy
It is something straight out of a James Bond movie: a bulletproof briefcase, complete with a secret compartment and a handcuff ring.
Tumi is launching an array of specialty products this holiday season, geared towards customers who are seeking a little bit of the classic and a little bit of pizzazz. Introducing a $5,995 briefcase suitable for a spy is just one of the ways the luggage company is trying to transform its brand.
"We've had a big push overall on developing our accessories business, it is part of our brand strategy, getting the message across to consumers that we are much more than just a travel company," Alan Krantzler, a senior vice president at Tumi, told CNBC.
About half of Tumi's revenues come from the travel category, but diving up sales per unit, the travel line accounts for just 25 percent of its total business. The remaining 75 percent comes from its accessories collection, which includes iPad covers, headphones and backpacks.
Tumi has also partnered with Diageo's Ketel One Vodka to create a mixology set equipped with shakers, coasters, glasses, an ice bucket and all the essentials for a Martini on the go. Only 60 sets, priced at nearly $4,000 each, are available for purchase this season, and half have already been pre-ordered.
Tumi is focusing on three key strategies for the brand, Krantzler said. The first is getting the next generation of men to its business, by shifting its focus from customers who are between 45 years old and 50 years old, and bringing more 30- to 35-year-olds into the brand. Second, there is a need to gain more recognition for its lifestyle and accessories products. And lastly, he said there has to be a focus on getting more women to embrace the brand.
"About 40 percent of our customer base is female," he said. "We are making a big effort to gear (products) towards women."
This year, Tumi collaborated with Anna Sui and focused its attention on handbags and totes. Krantzler said, the strategy is working.
Although Tumi is winding down a three-year lucrative partnership with Ducati, he said, the company is seeking more collaborative projects in the near future.
With a shift in demand for more lifestyle products, Tumi is adapting. This doesn't mean it will abandon its signature black-on-black ballistic-nylon travel bags, but it is taking risks and adapting to market.
"Asia, especially Japan, is becoming a lot more casual. It has moved away from the suit-and-tie culture, to more causal looks." Krantzler sees the same trend in Europe and here in the U.S.
-By Sally Shin, CNBC Producer; Follow her @sallyshin.
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