Fine jewelry and engagement ring retailing isn’t massively different than it was a decade ago, but there are certainly changing trends affecting stores, both large chains and small boutiques alike. Undoubtedly, today there is a greater focus on custom design and product that may be less classic than traditional standbys. For example, in engagement rings, brides and couples are more and more stepping away from a standard round, brilliant cut solitaire diamond ring and towards something matching their tastes and lifestyles, like fancy shapes and colored diamonds and gemstones.
Aside from the folly of fashion, which is always subject to the whims of tastemakers and influencers everywhere, I think the three biggest factors impacting fine jewelry retailing are 1) new shopper generations, 2) new shopping technologies, and 3) shifting societal norms.
Shoppers are leading a new kind of retail revolution, and it’s up to jewelers to keep pace.
New shopper generations
New digitally-native shopper generations like millennials are shaping retail like no previous shopper generation before them. They’re equipped with information and alternatives, and forget about old stereotypes of the unemployed/underemployed millennial slacker living at home – millennials are the only demographic segment with growing disposable income and wealth, and by 2020 the millennial segment will account for 30% – over $1.4 trillion – of total retail spend in the United States.
Related to fine jewelry, younger shopper generations often want to do things their own way – a bride and groom may shop for the engagement together, and they more often than not spend time beforehand shopping or researching online. When they get to the store, they may want something custom and less traditional, and most definitely different than what their parents did.
Retailers really have an opportunity to identify with these customers. As we all know, traffic continues to decline at brick and mortar stores, so when a younger customer does walk into a store, it is super beneficial to have associates with whom that customer might feel comfortable approaching, and really listening to that customer’s needs can help the service and sales process.
Of course, as every veteran fine jeweler knows, it’s best not to make any assumptions, especially relative to how much disposable income or what budget, a customer may have – it’s almost always much more than what might be expected! More than anything, I think millennials and other young shopper generations want what every jewelry customer wants – an awesome, memorable experience.
New shopping technologies
Shopping for fine jewelry used to take place in stages, as necklaces, bracelets and earrings were precursors to fancy engagement ring shopping, and along the way jewelry shoppers got a good basic understanding of the 4 C’s – cut, clarity, color and carat. In return, merchants got an opportunity to nurture clients and build long-term customer loyalty and retention.
Now, with the internet and its associated technologies, not so much.
Shoppers are now turning to the internet as their expert source, and social media platforms like Pinterest and Instagram offer up ideas on custom designs and treatments. The internet is also great for storytelling, and no retail purchase is more experiential, more reflective of a great story, than the purchase of fine jewelry.
Online technologies are also creating an entirely different business model with shared economy principles, and it’s not limited to transportation and travel lodging. In March of this year, Flont closed an oversubscribed $2 million funding round to support its business of allowing its members the ability to “flont” $60,000 of jewelry per year, choosing a new piece each month from its curated collection, all for just $249 per month. Eleven James has done the same thing with luxury watches since 2014, starting at just $149 monthly.
So, while diamonds might be forever, how does fine jewelry retail adapt to a new era of impermanent experiences?
Shifting societal norms
The internet not only empowered new and different shopping behaviors, but it also made the world a smaller place, opening up the creation, sharing and consumption of news and stories of public interest. In doing so, it has helped expose the dirty little secrets of so many industries, including diamonds and fine jewels.
New shopping generations have for years gravitated toward brands supportive of social and community causes, so, it’s no surprise the issue of conflict diamonds – a term used for a diamond mined in a war zone and sold as a means to finance civil war insurgencies and other warlord activities – continues to become more prominent. It’s not only led to the changing of how diamonds are sourced and sold through the Kimberley Process, it’s spurred the explosive growth of synthetic or lab created diamonds.
With high-profile investors like actor/environmentalist Leonardo DiCaprio backing producers like Santa Clara-based Diamond Foundry, consumers are increasingly drawn to laboratory produced diamonds that are not only indistinguishable from natural diamonds, but that come free of any messy controversies surrounding natural diamonds.
In addition to the products themselves, shifting societal norms are also freeing up new, previously underserved markets, particularly same-sex/same-gender couples and multiple marriages, and the importance to the engagement and wedding industry – jewelry included – cannot be overstated.
Exactly like other couples, same-sex couples want purchasing engagement rings and wedding bands to be a really significant event in their lives. Engagements and weddings can often be the single largest a customer has made before, whether they are heterosexual or in a same sex union; and it tends to stand true whether customers are two women or two men. As all jewelers should know, each couples’ needs and desires are completely individual and varying, but they all share the common desire to feel special, and they want their marriage to be treated the same way – they are celebrating love and a significant partnership.
It’s well past time fine jewelry retailers get on board with same sex unions and serving these customers and giving them a great experience just as they would anyone else.
As for couples looking at engagement jewelry for a second, third or even fourth marriage – the so called “encore engagements” – they almost all look to do something they didn’t the first or second time around. These unions typically happen later in life which often offers much greater spending potential, and it is not uncommon for the couple to shop together for engagement jewelry.
As such, servicing these encore engagements should be all about customer experience; making this purchase really unique and luxurious can be key, and some of the luxury jewelry houses have done a really good job here, creating special salons and such in-store to make it a private, specialized experience and purchase.
It’s been my experience that many of these customers are looking for maybe a larger diamond than they once had and often not just a classic solitaire diamond ring; they consider side stones and certainly custom designs. They also often consider purchasing multiple band rings in various styles, with or without diamonds, and perhaps some with colored gemstones, with each stacking band representing a significant event, each being worn individually, together, or in various combinations and such.
Retail as a whole has always been a dynamic, ever-changing industry, but fine jewelry has often moved at a slower pace than other segments. Today, new shoppers and new shopper behaviors are requiring different approaches – you can’t sell jewelry to today’s shoppers like you did to their grandparents – and the responsive and agile brands will be the ones surviving and rising to the top.
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