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The Bridal Jewelry Boom
Editorial
Jul 18, 2014 12:07 AM
By Avi Krawitz
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RAPAPORT... Demand for engagement and wedding diamond jewelry is stronger than ever, presenting an unparalleled opportunity for the trade. Today’s couples may be well-informed and have larger budgets, but they’re still looking for guidance in their hopefully once-in-a-lifetime ring purchase. Diamantaires and jewelers ought to nurture their position in this sector, which has emerged as the primary growth engine of the market.
Research regarding the U.S. wedding market, conducted separately by De Beers and The Knot, a wedding services website, reached comparable conclusions that shed some light on the trends to look out for.
Perhaps most significantly, both companies recognized that the wedding market extends well beyond the engagement ring purchase. The Knot identified three additional business opportunities when looking at bridal jewelry, including the wedding band, other wedding jewelry – such as earrings, bracelets, necklaces and hair pieces – and jewelry for occasions beyond the wedding, such as anniversary bands.
The implications for a jeweler are quite obvious. For them, weddings are as much about building relationships as for the bride and groom. “The groom has so many anxieties about this purchase that if he can find a jeweler he can trust, it’s a relationship that can last a very long time,” Rebecca Dolgin, editor in chief and vice president of XO Group, which publishes The Knot, said in a presentation given recently at JCK Las Vegas.
Astonishingly, out of approximately 14,000 brides and 1,700 grooms surveyed for The Knot’s 2013 Engagement & Jewelry Study, only half said that their jeweler did some follow up after their engagement ring purchase. That is surely a missed opportunity, as Dolgin suggested.
Stephen Lussier, CEO of De Beers Forevermark brand, agreed and stressed that engagement ring customers are probably the easiest target to generate incremental business. “You know who they are, that they’re going to spend money and that they want a diamond,” he said at a De Beers presentation during JCK Las Vegas.
Indeed, following the engagement, De Beers estimated that about 80 percent of wedding rings today contain a diamond, while around 20 percent of women buy another piece of diamond jewelry before the wedding.
Still, the diamond engagement ring is the core purchase that begins the relationship between the jeweler and the couple, and it naturally accounts for the largest portion of revenue in the bridal jewelry market. According to De Beers, it was also the sharpest growth point in the diamond jewelry market between 2011 and 2013 – showing “very strong” growth in both price and the volume of pieces sold, continuing the long-term trend seen in this market. During the past decade, the average amount of money spent by couples on diamond rings has increased 40 percent while the carat content has gone up 60 percent as well, Lussier reported.
Dolgin estimated that grooms spent about 20 percent more on the engagement ring in 2013 than they did in 2011, paying an average $5,258 on a center stone and an average $5,403 on a combined stone and setting. The average amount spent on the bride’s wedding band increased from $1,100 in 2011 to $1,300 in 2013, while brides spent about $452 on additional wedding day jewelry. Grooms, on the other hand, spent around $375 on their own wedding accessories such as cufflinks and watches, according to The Knot.
Both surveys suggested that couples are investing more – both financially and emotionally – in the whole wedding experience. That extends from more elaborate proposals to having more income at their disposal for the wedding day. Lussier reasoned that people are waiting longer between the engagement and marriage and perhaps have more time to save up for the wedding – and therefore they have larger budgets for wedding jewelry than before. Brides and grooms are also possibly a little older than they used to be, with the average age of brides that took part in The Knot’s survey being 27 to 28 and grooms typically one year older.
Some things don’t change, particularly for grooms who continue to walk a fine line between the bride’s desire to be surprised, and her genuine concern that he’ll pick the right ring. Brides and grooms, it appears, are looking at different aspects of the purchase. Dolgin explained that grooms are typically anxious about getting the most value for their money, and therefore make the decision on the stone size and where to buy the ring; while the bride is the one deciding on the design elements, such as the cut and shape of the stone and the setting of the ring – dropping not-so-subtle hints about their preferences along the way.
As it turns out, the bridal jewelry market is as influenced by fashion and pop culture as any other luxury item. In a recent interview with Rapaport News (see the Rapaport Weekly Report from July 11, 2014), Paola De Luca, creative director at Trendvision Jewellery & Forecasting, stressed that by simply looking at the consumer magazines that target brides, one can observe distinct styles of rings. “Trends change as quickly as magazine covers and celebrities,” said De Luca, whose company recently concluded its own research on design trends in the bridal jewelry market to be published in its upcoming Trendbook 2016.
The diamonds typically used in a center stone are round, but you also have variations of oval, emerald and cushion cuts, De Luca explained. The Knot survey showed that in 2013, the average size of the center stone was 1.1-carat, while one in three rings had prong settings, and 60 percent of rings had a clear diamond center stone with side stones.
The bread and butter of the general diamond industry remains the more affordable 0.30-carat to 0.50-carat diamonds and SI and lower clarity goods. Though, when it comes to such once-in-a-lifetime occasions as engagement and weddings, couples tend not to hold back on the ring. At least subconsciously, the value of the ring is a reflection of their commitment to each other.
By its own admission, The Knot reaches the more affluent bride. However, Dolgin noted that while the average expense may change between different demographic groups and income levels, the general trend and breakdown in what people are interested in remains fairly consistent.
That consistency within the bridal market is what makes it such an exciting opportunity for diamond and jewelry businesses. For an industry that tends to focus on the Christmas holiday to spur growth, and has been boosted by the addition of the Chinese New Year to its sales calendar, bridal remains a constant throughout the year. Furthermore, it spans across all markets with diamonds firmly entrenched in the wedding culture in China and India, as they are in the U.S.
Seasons may change but there’s always someone getting married. Therefore, bridal represents a fairly simple and obvious formula for jewelers to achieve growth. By providing a positive initial engagement ring experience, chances are that the jeweler will gain repeat customers for the wedding, anniversaries and future occasions. After all, diamonds, like weddings, are about long-term relationships. It’s up to the jeweler to foster his own.
The writer can be contacted at avi@diamonds.net.
Follow Avi on Twitter: @AviKrawitz and on LinkedIn.
This article is an excerpt from a market report that is sent to Rapaport members on a weekly basis. To subscribe, go to www.diamonds.net/weeklyreport/ or contact your local Rapaport office.
Copyright © 2014 by Martin Rapaport. All rights reserved. Rapaport USA Inc., Suite 100 133 E. Warm Springs Rd., Las Vegas, Nevada, USA. +1.702.893.9400.
Disclaimer: This Editorial is provided solely for your personal reading pleasure. Nothing published by The Rapaport Group of Companies and contained in this report should be deemed to be considered personalized industry or market advice. Any investment or purchase decisions should only be made after obtaining expert advice. All opinions and estimates contained in this report constitute Rapaport`s considered judgment as of the date of this report, are subject to change without notice and are provided in good faith but without legal responsibility. Thank you for respecting our intellectual property rights.
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Tags:
Avi Krawitz, Bridal, De Beers, diamonds, Jewelry, Rapaport, The Knot
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