2. Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
SOURCES: Team Analysis
EXECUľ IVE
SUMMARY
With ouí stíategy Meaningful Connections, Pandoía is on the íoute to achieve all its
taígets
Situation Question Solution Impact
How can Pandoíagíow
its customeí base within
Millennialand Gen Z
consumeís and achieve
an annual íevenue gíowth
of 6 to 8% in line with the
taígets set in the Phoenix
Stíategy?
Píoject Phoenix:
Pandoía aims towaíds
being the most desiíable
bíand in the affoídable
jewelleíy industíy.
10k Mn
ľ onne
s
Reduction in scope
3 emissions (CO2)
USD
5.25 Bn
Net píesent value
of the incíemental
cash flows fíom
the píoject
10.4% Revenue CAGR
till
2024
Millennials and Gen Z:
A key píioíity to connect
with this customeí gíoup
Coíe Maíkets: Incíeasing
emphasis is being given to
stíengthen the bíand
position in USA and China
1
2
3
ľhe suggested stíategy involves
íobust initiatives undeí
“Meaningful Connections”
constituting of 3 sub-categoíies:
ÏOR ÏAMILY: ľailoíed
and peísonalised advice
1
ÏOR ÏRIENDS: Co-
cíeation
ÏOR YOU: celebíating
peísonal achievements
“
3. ľHE SľORY SO
ÏAR
Pandoía stíongly believes in becoming woíld’s most affoídable and desiíable company and has developed a solid
foundation
Pandoía opeíates on a unique business
model …
400
Variations of new innovative
designs based on consumer
insightsandtrend research.
26000
Talented employees, from
enables the company to craft
hand-finished jewellery from
affordable prices.
650
Million yearly visits relying
on robust marketing, with an
unmatched brand awareness
and highconversionrates.
7000
Points of sale with regional
online stores, social media
and other platforms with data
drivengrowthagenda.
ľ HE PANDORA
BUSINESS
MODEL
… building a successful scale of opeíations, fulfilling set
objectives
USA and China with theií
high expected gíowth
píovide a good oppoítunity
OBJECľIVES Aľ LARGE
• Become the desiíable bíand in the affoídable-jewelleíy maík
• offeí women high quality, modeín jewelleíy at affoídable píices
• Achieve sustainable píofitability
• Continue with innovation and tíansfoímation
100
COUNľRIES
650
MILLION
VISIľORS
1 JEWELLERY
MANUÏACľURER
Afteí coping with pandemic,
the íesultant slump in the
industíy , Pandoía now has
íeached a stage wheíe it
needs to focus on gíowth
and íevenue
SHARE OÏ ľOP 7
MARKEľS
SOURCES: Case Material, Pandora Annual Report 2020
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
2
4. ľ HE HURDLES AND ľ HE Ï LYING
PHOENIX
SľRAľEGY PHOENIX píovides us with the ideal building blocks to addíess
this
BRAND
incíease bíand desiíability and íeach
thíough holistic communication acíoss all
the consumeí touchpoints
DESIGN
Customeí-
gíoup centíic innovation and
cíeation to design foí diffeíent needs and
the taíget gíoups
PERSNALISAľION
Relevant and highly customized seívice
thíoughout the whole customeí jouíney
CORE MARKEľS
Incíeasing focus on key maíkets like USA
and China which íepíesent moíe than 50%
of the global jewelleíy maíket
ľhe company’s main aim is to incíease íevenue and gain tíaction among youth but it faces ceítain complications
which need
to be addíessed using tenets of Stíategy Phoenix
PROBLEM SľAľEMENľ: Incíease Revenue 6 -8 Peícent and Maíket Shaíe thíough Gen Z and Millennials in lines with taígets set in Phoenix
BRAND DESIGN
PERSONALI
-SAľION
CORE
MARKEľS
GROWľH
PILLARS
1
Low oíganic gíowth in key
maíkets like USA and
China
2
Building a bíand is
necessaíy
3
Píepaíedness to meet new tíends like
dependance on Social Media
4
Adapting to needs of Gen Z and
Millennials – souíce of bulk íevenue
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
SOURCES: Case Mateíial, ľeam Analysis, Eaínings Call Q4 2020
(Pandoía)
3
5. ľ HE Sľ ORY Ï OR ľ HE
Ï Uľ URE
Ïíom the industíy standpoint - AI, digital analytics and the need to cateí the youngeí geneíation would díive
gíowth
Gíow in Key Maíkets
CAGR OÏ 5.6% IN KEY MARKEľS PROVIDING A
LUCRAľIVE OPPORľUNIľY ľO SľRENGľHEN CUSľOMER
BASE
In DKK.Mn.
600,000
500,000
400,000
300,000
200,000
100,000
-
2021 2022E 2023E 2024E 2025E
China USA
Develop Digital Capabilities
INCREASING ADOPľION OÏ
SOCIAL MEDIA AND GROWING
DIGIľIZAľION
In DKK.Bn.
1600 1576
+21%
1174 +14%
1200
+16%
800 +6%
+79%
+84%
400
0
2021 2025E
In-Stoíe Online
Develop Loyal Gen Z and Millennial Ïollowing
IMPERAľIVE ľO ľARGEľ GEN Z AND MILLENIALS
+19%
Baby Boomeís 23%
Gen X 38%
Millenials 35%
Gen Z 4%
7.5%
32.5%
47.5%
+60% of total
maíket
12.5%
2019 2025E
IMPERATIVES
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
SOURCE : BCG x Alta Gamma (2021): True Luxury Global Consumer Insight 8th edition, Case Material, Team Analysis
4
6. ľAKING CUE ÏROM PHOENIX – Being Customeí Centíic
While Ïíom the customeí’s view - puípose, innovation, digital channels along with focusing on coíe aíeas aíe
necessaíy
Puípose and Innovation both must be geaíed
in ouí stíategy
Alteínative Medium foí China can
be looked at
In line with Stíategy Phoenix coíe
stíengths must not be boycotted
72%
Of the people believe Peísonalization is of
píime impoítance in any deal
131 Pandoía oveí index vs. categoíy
aveíage
% of People buying on the
Go
48%
47%
46%
45%
44%
43%
42%
41%
40%
39%
Gen Z's Millenials
Name Alice Jenny
Age 17 Yeaí old 33 Yeaí Old
Puípose
LOW HIGH LOW HIGH
Innovation
LOW HIGH LOW HIGH
Social Media
LOW HIGH LOW HIGH
ľ he
Millennial
ľ he Gen
Z
LESS INROADS OÏ D2C CHANNELS
Pandoía has not been able to establish a stíong
D2C píesence and maíketplaces have dominated
and apps like WeChat aíe used píominently
ľHE DIÏÏERENľIAľING ÏACľOR ÏOR PANDORA
• People get íeminded of Special Moments oí
People they caíe foí when puíchasing
pandoía.
• ľhey íealise the special meaning it caííies
and expíession of peísonality builds fíom
within.
• A sense of belongingness is cíeated, which
lasts foí long.
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
SOURCE: McKinsey (2020): What makes Asia-Pacific’s GenerationZ different? ,McKinsey (2020): China’s Gen Z are coming of age: Here’s w hat marketers need to know :
5
7. “ It’s the simple moments togetheí that
changes us foíeveí”
MEANINGÏUL CONNECľIONS
SľRAľEGY
A wholesome stíategy which takes into account the customeí pain-points and industíy tíends by empoweíing all
íelationships
MEANINGÏUL CONNECľIONS
ÏOR ÏAMILY ÏOR ÏRIENDS ÏOR YOU
GIÏ ľ ERS AND HINľ ERS 2.0
A simple extension wheíein we ask the useí to
píovide the email addíess of a loved one and
leveíaging AI and ML gives tailoíed advice to
the gifteí .
KEY
Ï EAľ URES
KEY
ÏEAľURES
KEY
ÏEAľURES
“ ľhe Social Connect, the Pull will all make it
woíthwhile”
“ Eveíy Connection -be it a tíee oí a single
consumeí matteís ”
New Souíce –
Data Collection
Peísonalized Relationship
and Puípose
Ventuíing into new Leveíages Social Viíality thíough
maíkets Media Design
CO-CREAľION AND CONNECľ
PROGRAMME
Co-Cíeation – A Novel tactic that enables the
useís to co-cíeate jewelleíy togetheí live.
Connect Píogíamme -- A íevolutionaíy tactic
which empoweís social connections, People can
connect by scanning jewelleíy.
Customeí Bíanding Sustainable Low Cost
CELEBRAľING LIÏE
An ad campaign geaíed towaíds celebíating
you and youíself – append youí
achievements and cíeate a jewelleíy to
celebíate youíself.
Bíand Building thíough advocating ouí impact
on enviíonment and puípose.
.
Based on the coíe tenets of Píoject Phoenix, this Customeí Centíic Stíategy will cíeate massive
impact by EMPOWERINGALL RELAľIONSHIPS
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
SOURCES: Team Analysis
6
8. DEEP DIVE – MEANINGÏUL CONNECľIONS ÏOR
ÏAMILY
A simple cost effective extension can cíeate customeí delight: help us gain tíaction in digital channels and impíove data
analytics
MEANINGÏUL CONNECľIONS
“ It’s the simple moments togetheí that changes us foíeveí”
Happy family
Customeí Side RAľIONALE
01 We get evolving data on gifteí’s píefeíences
02 Coíe Stíengths emphasized -Peísonalization
03 Diíectly appeals to youngeí demogíaphic
04 Netwoík Effect – a nexus of customeís
05 Feasibility – Easy and effective execution
Digital Gen Z and Millennials
Majoí Capabilities developed to meet industíy tíends
MARI
A
Maíia gets a píompt
to enteí E-Mail
Addíess of heí loved
ones.
On occasions that
matteí, Steve gets an
email with a link
Steve Doesn’t need
to go thíough pain
of thinking what she
likes
Sľ EV
E
Pandora
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
1
2
3
ľhe E-Mail gives AI ML
suggestions on what the hinteí
likes
4
SOURCES: Team Analysis, Case Material, BCG
7
9. Majoí Capabilities developed to meet industíy tíends
DEEP DIVE – MEANINGÏUL CONNECľIONS ÏOR
ÏRIENDS
Co-Cíeation píovides an element of social belonging while helping us meet most of the industíy
tíends
MEANINGÏUL CONNECľIONS
“ ľhe Social Connect, the Pull will all make it woíthwhile”
CUSľOMER SIDE
RAľIONALE
CO-CREAľION EXPLAINED
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
Digital Gen Z and Millennials
Key Maíkets
ALICE MEEľ S JENNY IN A
PARľ Y
ľhey wish to exchange social
media handles on the move
Just by holding heí QR Code enabled Genesis
Chaím and asking Jenny to scan it enables heí to
shaíe all social media handles/ websites he has
stoíed
Alice loves it as he appeaís cool and
he inadveítently adveítises ouí
bíand
01
Millennials with theií high inclination foí
innovative píoduct may love to have it.
02
Social Media and connectivity will be
leveíaged to a gíeat extent.
03
With a tíendy, cool and a hip design and
concept, it will cíeate buzz among customeís
04 Netwoík Effect – a nexus of customeís
05 Feasibility – Easy and effective execution
SOURCES: Team Analysis
8
10. A íevolutionaíy idea can expand the utility of jewelleíy and íevolutionize the way we think about it
MEANINGÏUL CONNECľIONS
“ ľhe Social Connect, the Pull will all make it woíthwhile”
CONNECľ – Explained RAľIONALE
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
DEEP DIVE – MEANINGÏUL CONNECľIONS ÏOR
ÏRIENDS
Digital Gen Z and Millennials
Majoí Capabilities developed to meet industíy tíends
USA
Maíia goes on a website and
sends a link to heí fíiends oí
sends an invite
STEP
1
STEP
2
STEP
3
ľhey aíe able to collectively
woík togetheí, they have
loads of fun
ľhey aíe beaming as they have an item which helps them
íemembeí the fond memoíies they have cíeated togetheí as a
gíoup
CHINA
Wang Li and heí fíiends have
a WeChat Gíoup wheíe they
decide to staít making some
customized jewelleíy
On a WeChat Mini Píogíamme,
Embedded link opens wheíe
they woík collectively
01
Allows us to enteí stíongly in China, playing
on Chinese consumeí píefeíences and habits
02
Social Media leveíaged, given that 29% of
millennials buy something via social media
03
High íeceptiveness, such that even if one
membeí becomes a customeí, fíiends nudged
04 Netwoík Effect – a nexus of customeís
05 Feasibility – Easy and effective execution
SOURCES: Team Analysis
9
11. DEEP DIVE – MEANINGÏUL CONNECľION ÏOR
YOU
Celebíating self achievement: the íeason people buy Pandoía jewelleíy
MEANINGÏUL CONNECľIONS
“”Eveíy single connection be it a single tíee oí a single consumeí matteís”
RAľIONALE
01
Millennials who with high inclination foí
innovative píoduct may love to have it.
02
51 peícent of the people want to connect with
bíands that have a puípose
03
With a tíendy, cool and a hip design and
concept, it will cíeate buzz among customeís
04 Building ouí Bíand on Values
05 Feasibility – Easy and effective execution
An ad campaign geaíed towaíds celebíating you and youí
self. On any majoí event oí milestone foí you, buy a chaím and
append that to the jewelleíy you aíe cíeating foí youí life
18ľH
BIRľHDAY
GRADUAľIO
N
PROMOľIO
N
WEDDIN
G
MOľHE
R
SOURCES: Team Analysis, BCG x Alta Gamma (2021)
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
Gen Z and Millennials
Majoí Capabilities developed to meet industíy tíends
10
12. POSIľ IONING BRAND AS
SUSľ AINABLE
Reinfoícing the goodness people spíead by using ouí píoducts
MEANING ÏUL
CONNECľ IONS
Being betteí with fíiends
M
a
d
ew
ithlo
v
e
“Each Pandoía piece passes thíough an
aveíage of 25 paiís of hands duíing the
cíafting píocess”
Attaching stoíy of a makeí, how it is
changing his life, and having a peísonalized
message on what the jewelleíy symbolizes
will add an element of peísonalization and
will pull customeís moíe adding a sense of
attachment.
Befoíe puíchase adding impact figuíes on how
sustainable this puíchase is compaíed to
alteínatives will also bíing about a sense of
puípose to ouí bíand.
“You saved 50 tonnes of Co2 which
emissions which equates to 5k gallons of
gasoline foí 6 homes electíicity foí a yeaí”
ľhe website will show the Impact geneíated
when a useí makes a Pandoía puíchase.
CALCULATE YOUR IMPACT
RAľIONAL
E
01
80% of the people in millennials and Gen Z
would want to pay extía foí Sustainability
02 Appeals to Gen Z as a bíand with puípose
03
Building ouí bíand is essential in this
maíket to píospeí
SOURCES: Annual Report, Case Material, Confeíence Boaíd Global Consumeí Confidence
suívey
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials 11
13. ľ IMELINE AND
IMPLEMENľ Aľ ION
Keeping in line with Phoenix’s Launch and leveíage stíategy, extía caution needs to be taken
duíing pilot
In Accoídance with Launch and Leveíage, any pilot will be staíted on a veíy cautious basis and only when its ceítain
that we can íeach significant scale will we íoll out in otheí countíies.
US Pilot US Launch China Pilot
China Launch Launch in otheí
geogíaphies
Gifteís and Hinteís
2.0
June Dec Dec Dec
C
e
C
l
e
e
l
b
e
í
b
a
í
t
a
i
n
t
i
g
n
g
L
i
L
f
e
i
f
e
C
a
C
m
a
m
p
a
p
i
a
g
i
n
g
n
2
2
0
0
2
2
2
2 2023
June
2024
June
2025
June
S
u
S
s
u
t
s
a
t
i
a
n
i
a
n
b
a
l
b
e
l
e
J
e
J
we
we
l
e
l
e
l
l
í
e
y
í
y
C
o
C
-
o
C
-
í
C
e
í
a
e
t
a
i
o
t
i
n
o
n
P
í
P
o
í
g
o
í
g
a
í
m
a
m
FOR FRIENDS
C
o
C
n
o
n
n
e
n
c
e
t
c
P
tl
P
a
l
t
a
f
o
t
f
í
o
m
í
m
FOR
YOU
FOR
FAMILY
Extía time given to tasks which need píepaíation
Launch in one íegion only if
significant
value can be added
US PILOT
Level of Success
CHINA
PILOT
Level
of
Success
EUROPE
LAUNCH
ASIA LAUNCH
GLOBAL
LAUNCH
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
SOURCES: Team Analysis
12
14. RISK ANALYSIS AND MIľ IGAľ ION
Sľ RAľ EGIES
Analysing the potential íoadblocks and finding stíategies to counteí
them
Píobabilit
y
Impact
RIS
K
EXPLANAľIO
N
MIľIGAľIO
N
Regulatoíy
Issues
Bíand íelevance
and competition
Supply
chain
disíuptions
Ïluctuation
in píices
Uncleaí laws, inconsistent
íegulatoíy inteípíetation and
compliance in the maíkets
(China) we aíe expanding
Competition fíom the non-
jewelleíy playeís in adjacent
categoíies intíoducing new
collections oí expanding theií
assoítment
Ability of Píocuíement of íaw
mateíials and to píoduce and
distíibute finished píoducts
Incíeasing oíganisational
agility to be able to íespond to
íapid and unpíedictable
changes
Building stoíy behind puíchases
and adding diffeíentiation
based on emotions.
Consumeí-centíic innovation.
Afteí Mitigation Measuíes
High
High
Low
Low
Multiple souícing of mateíials
Diveísified píoduction facilities
Having adequate buffeí stock
in case of tempoíaíy disíuption
Fluctuation in píices of íaw
mateíials and also cuííency
exchange íate íisk
Hedging annual commodity
puíchases, exchange íate and
inteíest íate íisk.
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
SOURCES: Case Material, Pandora Annual Report 2020
13
15. IMPACľ
GENERAľ ED
ľ o conclude, let’s see how numbeís speak foí ouí stíategy Meaningful
Connections
18,000
20,500
23,000
25,500
28,000
2020 2023
2021 2022
With Meaningful Collections
2024
Impíessive ľopline Gíowth of 10.4% CAGR
puts
MC in a league of its own
Revenue (In DKK Millions)
With an impíessive NPV the píoject does
massive
value addition
Without
Ouí incíeasing bottom line and giving us
massive Competitive Advantages
EBIľ Maígins (Peícentage)
Due to a shift in digital and sustainability
ventuíe, emissions will decíease
0.14
0.18
0.22
0.26
0.3
2021 2022 2023 2024
Scope 3 emissions(CO2) íeduced by 10k Mt tonnes
which is equal to
Maíket Shaíe in Key Maíkets will also
incíease
significantly lead by China and USA…..
CAGR Gíowth 2020-23 (Daíkeí implies moíe gíowth)
Pandoía is well placed digitally as the social
ventuíes we undeítook gíew online Sales by
18%
USD 5.25
Billion
2600
Passengeí vehicles
díiven
in a yeaí
1.3 Mn
Gallons
of gasoline consumption
obseíved
18%
Compounded
Annual
Gíowth Rate
SOURCES: Team Analysis, Case Material, Pandora Annual Report 2020
14
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
16. ÏINANCIAL
S
Gíowth Píojections – With Meaningful
Connection
Gíowth Píojections – Without Meaningful
Connection
NPV
Calculations
1 Majoíity gíowth íate captuíed in Chaíms and bíacelet segment as they would be the
main focus in ouí new stíategy
2 Decíeasing cost of sales due to impíoved efficiency and opeíational leveíage
3 Incíeasing maígins due to economies of scale and post pandemic íecoveíy
4 Nominal gíowth accoíding to industíy píojections in the coming yeaís if the stíategy
is not adopted
5 As sales in countíies like US which have a higheí effective tax íate pick up, we see an
oveíall íise in the effective tax íate
Notes- Impoítant
Assumptions
Setting the stage Insights Solution
Timeline and
Implementation
Risks and Mitigation Impact and Financials
16
SOURCES: Team Analysis
15
