Turning Tiffany & Co. around and setting it on a sustained and significant growth trajectory would be one of the biggest success stories in the luxury industry. The prospect of transforming the seemingly ever-underperforming, yet iconic American jeweller into a growth driver was what lured Paris-based LVMH, parent company of brands like Louis Vuitton, Dior, Rimowa and Fendi into a – potentially short-lived – love affair with New York-based brand. It seemed to be a match made in heaven , but recent events may lead to a break-up. According to The Wall Street Journal , LVMH has accused Tiffany of mismanagement during the Covid-19 crisis, citing disappointing results that are “significantly inferior to those of comparable brands of the LVMH Group during this period”. Additionally, the French group, controlled by billionaire Bernard Arnault , alleges that a letter from the French foreign minister obliges them to delay any commitment in order to have leverage in a potential trade war between France and the USA. Win-win: What cultural restoration projects mean to brands like LVMH As a response, on September 9, Tiffany & Co. announced a lawsuit against LVMH to enforce the planned merger. The Financial Times indicated in an article on September 11, titled “Grandmaster Bernard Arnault looks to the Tiffany endgame”, that the moves may have been nothing more than an aggressive tactic to lower the price from that negotiated before the pandemic. The article states that Arnault used tactics from chess to secure the US$16.6 billion acquisition, including “decoys, deflections, pins and interference”. The next months will prove whether these tactics will play out in favour of LVMH, or if trying to buy a luxury at a discount could become costly for the world’s leading luxury conglomerate. While the outcome of the very public battle is unclear, a potential marriage that starts with a public fight in court is not the most romantic and promising way to start a successful long-term relationship. It suggests that even if LVMH does proceed with the takeover, a smooth integration may be at risk. Why luxury brands are crazy for these 4 Japanese models Over the last decade, Tiffany has made a series of changes at the top, including the stepping-down of former CEO Frederic Cumenal in early 2017, leading to the appointment of Alessandro Bogliolo that autumn. Bogliolo was confronted with the critical need to focus on more affordable collections while not alienating brand image and top-end customers who expect exclusivity, personal attention and privacy. Facing forwards will be key to achieving buoyancy in the years ahead: Brands that don’t resonate enough with millennials and Gen Z risk their future. Even worse, when the brand positioning becomes blurry, it risks reducing the brand’s emotional bond. When I discussed the issue with my luxury MBA students – all of them young millennials – at Pepperdine this spring, their preference was for other competing brands. Tiffany needs a rigorous and consequent turnaround and the marriage with LVMH could be the perfect match. LVMH has a track record turning around luxury brands and Tiffany needs one of the biggest turnarounds in the business. For LVMH the deal would significantly strengthen its position in the North American market and in the fine jewellery business. Only US$2 million? Why these high-end supercars are priced too cheap To bring back consistent growth, every aspect of the brand needs to be addressed. First, brand equity needs to be rebuilt entirely. It is not enough to capitalise forever on Audrey Hepburn. Millennials need storytelling that is relevant for now, translating historic values into extreme value for today’s customers. Overdependency on the past can be catastrophic, as many failed brands have learned the hard way. Second, the brand has to bring excitement back to their customers, whether they are current, lapsed or prospective. This will only be successful if the entire experience from digital to physical is reimagined and taken to a different level. Intentions don’t count. The ultimate judge will be the customer. Why luxury brands are harnessing the power of Chinese KOLs Third, Tiffany needs to clean up its portfolio and refocus on the top end. Some of this has already been initiated by Bogliolo and his team. All of this will require dedication, focus and expertise. This is why the current relationship drama and the potential break-up are so dangerous. The current situation could easily lead to a downward spiral. Breakfast at Tiffany ’s? A love affair? A lasting romance? Or a brutal break-up that ends in court? Time will tell. Want more stories like this? Sign up here . Follow STYLE on Facebook , Instagram , YouTube and Twitter .