How Can Traditional Jewelry Stores Make Changes to Survive?
The traditional jewellery industry must make changes if it is to succeed in the future. According to Unity’s Jewellery Report for 2011, more money is being spent on jewellery, more people are buying jewellery, but overall each person is spending less. How can the consumer be enticed to spend their money on jewellery?
Last month, Unity Marketing released the Jewelry Report 2011, a report based upon a consumer survey conducted on March 30 and April 1 of 553 recent jewelry buyers, identified from a statistically representative sample of 1,055 U.S. households. The results of this report were compared and contrasted with a similar survey conducted in July 2007 of 753 jewelry buyers.
Unity’s Jewelry Report 2011 pegs U.S. jewelry sales at $56.23 billion in 2010, an 8 percent increase over 2009. This figure includes both costume and fine jewelry and is based on data from the U.S. Bureau of Economic Analysis. (This figure does not include watch sales.)
The Jewellery Industry Must Make Changes to Survive
Where is the Jewellery Industry in 2011?
According to Unity data, 2010 was the first time since 2007, when jewelry sales reached $54.76 billion, that year-over-year revenue increased for the industry.
The report showed that the rising price of precious metals has consumers seeking out more affordable alternatives, such as palladium and plated pieces.
Today’s consumers also know how to pick up a new piece of jewelry at a better price. The average spent on a piece of nt.
There is a Demand for Men’s Jewelry
Among the most profound shifts the research uncovered is the growing demand for men’s jewelry. Over two-thirds of the growth in the jewelry market from 2008 to 2010 is directly attributable to increased expenditures on men’s jewelry.
Jewelers Need to stock More Pieces Crafted of Lower-cost Metals
Unity Marketing President Pam Danziger said given this, it is recommended that jewelers stock more pieces crafted of lower-cost metals, semi-precious stones and other materials that traditionally have been considered “costume” in nature.
Jewellers Need to Develop Creative Ways to Lure Customers
Danziger said jewelry stores have to work “harder and smarter” to entice customers today. They need to develop creative ways to lure customers in by using all the marketing tools available to them, including social media, community events and local business partnerships, such as pairing up with the neighborhood bridal shops.
Jewelers Need to Face the Fact that Consumers can Make Purchases Elsewhere
The report showed that shoppers are turning to different sources for their fine jewelry, including department stores, the Internet, artisans and art galleries, home shopping networks and discounters. According to Unity, Etsy.com is emerging as a jewelry-shopping destination for consumers looking for a homemade touch.
Traditional jewellery stores need to compete in the e-commerce arena.
Jewellery Stores Need to Be Less Intimidating and More Customer Friendly
The 2011 report showed that fewer consumers are shopping at the large chains and independent jewelry stores. They are choosing instead to frequent department stores, fashion boutiques, gift stores–a trend that could be attributed to sales of the popular brand Pandora in these stores–art galleries and the Internet to buy their jewelry.
Danziger said the reason for the shift could be that consumers find these other outlets to be “less intimidating” and more customer friendly than traditional jewelry stores.
Jewelry Buyers Want a Product that Emphasized Memories and Experiences
Take PANDORA, the Danish-based jewelry company that sells customizable charm bracelets, rings, earrings, and necklaces in more than 50 countries. Best known for its innovative update to the traditional charm bracelet, PANDORA has posted phenomenal growth of its global jewelry brand that generated ~ $1.2 billion (6,666 million DKK) in 2010 with 92.6% growth from previous year.
Danziger explains each PANDORA bracelet is a customizable piece that allows wearers to commemorate life events and interests with the addition of beads. With base bracelets in the $65 to $1,500 range and beads running from $40 to several hundred, this is a product that offers the opportunity for small splurges over time that will be meaningful to the owner. “Rather than just selling another piece of jewelry, PANDORA has transformed their product into an experience that its customers collect to commemorate milestone events and memories,” Danziger says.
“This deep understanding of the desires of today’s jewelry consumer — an affordable product that emphasizes memories and experiences — makes PANDORA a significant threat to traditional jewelry brands,” says Danziger
Pam Danziger of Unity Marketing at the Rapaport International Diamond Conference
Key Points made by Danziger at the Conference
- Ignore the economic noise, but be realistic
- Feature pieces with broader price points
- Add value to that customer relationship
- More people are spending money on jewellery, yet overall sales are flat
- Put less costly pieces up front
- Sell sets at an attractive price, ge them to purchase the necklace & earrings in one purchase, appear to give more in your presentation
- Get out there, find those customers that might like to purchase from the TV and entice them into your store or website
- Team up with charities, fashion stores, wedding boutiques
- Use social media, have a message that is buzzworthy
- Tell your unique story, what are you doing that is different and sets you apart from all the other jewellers in your area, post engagement photos, Tiffany’s serves champagne in the engagement room, have an open house for couples
- Build business partnerships
For more information click on Unity Marketing Jewelry Report 2011. Perhaps you agree with these suggestions for the traditional jewellery market to stay competitive. If you have any suggestions, please leave me a comment.
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