RAPAPORT... Colors and classics may be falling off, but bigger stones and unique designs are in demand. Sissy’s Log Cabin in Pine Bluff, Arkansas, is not moving deeply into any colors. “We have found that colored stones do not sell well in our market at any time,” said Mark Sanders, Sissy’s executive vice president. However, the store is doing well with certain designer pieces. “In the past couple of years, we have seen a tremendous increase in silver and gold designer jewelry,” he said. “I suppose the ability to mix the metal colors makes a jewelry wardrobe more versatile.”
WHAT’S OUT
One category that seems to be universally on its way out is anything run-of-the-mill. “I think the classics are starting to lose ground,” said John Hayes, owner of Goodman’s Jewelers in Madison, Wisconsin. “Simple basics have slowed up. People want something a little more individual looking. They have some of the basics covered, and they want to explore other fashion ideas. In politics, people are talking about change, and I think they’re looking to change their look as well.”
One trend retailers are noticing is the desire for larger stones. “People are trading their small diamonds in for larger ones,” said Abraham Frost, president of Frost & Co. Diamonds in Pittsburgh, Pennsylvania. “Remodeling is a big trend. Younger women today are getting much bigger stones than women did 30 or 40 years ago, so a lot of their mothers now want bigger stones, too. The current market of younger women has created a market for us with older women.”
Gail Friedman, owner of Sarah Leonard Jewelers, in Los Angeles, agreed. “Three carat is the new 2 carat,” she said. “We don’t have customers who buy 1-carat stones any more.”
In Pine Bluff, Sanders said, “Large diamond pieces will always be popular because of the need to celebrate engagements, anniversaries and other special occasions.” He noted that larger-diamond sales also were a growing trend in his market.
MIDRANGE IS WEAKAlthough the people who can afford to buy larger stones or upgrade to more serious pieces are still comfortable doing so, concerns about a shaky economic forecast have taken their toll in other sectors. “The middle price range has suffered,” said Hayes. “The lower price range has increased and, on the flip side, the real high end is still nice and strong. But what we used to consider our bread-and-butter price range has kind of evaporated.”
Sean Dunn, vice president of JR Dunn Jewelers in Lighthouse Point, Florida, said, “The economy has definitely affected the mix of our business. The lower-price-point merchandise has slowed, with the exception of branded products.”
Friedman noted that while her high-end sales are strong, the economy has affected other areas. “The people who can afford it are still spending the money, but the middle range is disappearing,” she said.
For those whose primary business is in bridal, however, Frost believes that economic trends are not terribly worrisome. “We’re in the business of love, and that always comes first,” he said. “In the bridal business, it goes back to Romeo and Juliet, and Adam and Eve. Whether they buy 0.5-carat or a 3-carat ring, they have to buy something. You might not buy the biggest diamond in the world, but you have to buy something.”
Taking stock of both economic and fashion indicators may help to build a solid bottom line come year’s end. Retailers are seeing a move away from traditional pieces and a turn toward items that allow customers to build a diverse jewelry wardrobe. In Los Angeles, Friedman is doing well with fashion looks. “Brown and chocolate pearls, as well as chocolate gold, are big for us, as are different golds,” she said. “Our customers look for unusual pieces.”
In Wisconsin, customers are adding semiprecious stones to their collections. “We’re seeing more colored gemstones,” said Hayes. “Garnets have been selling better, as have aquamarines, emeralds, Tahitian black pearls and chocolate pearl strands. Color gives people more variety.”
For Dunn, unusual shades are also popular, though semiprecious is flat. “Large, fancy yellow diamonds have been a big part of our sales increases this year,” he said. “As far as fashion goes, we see jewelry with organic shapes with brown, black and gray stones being hot. The biggest sales loser for us has been semiprecious color. I feel people have moved away from this product because, when times are uncertain, they go back to basics and to the more muted colors like brown and black.”
The Marketplace• Round and princess cuts top engagement-stone sales, with marquise and emerald making strong showings.
• The most popular carat-weight averages 1.5 carats, but sales of larger stones are becoming more common.
• The most popular color is G, though F is a close second.
• SI1 is the best-selling clarity, followed by VS2.
• White gold is the most requested metal for settings, though palladium is gaining ground.
• $8,500 is the average price for an engagement ring, including stone and setting.
Article from the Rapaport Magazine - August 2008. To subscribe click here.