U.S. Retail Market Report

RAPAPORT... It’s common knowledge among jewelers that even in tough times bridal sells. What’s not so commonly known is that estate is also doing very well right now. Some customers are drawn to estate because of its perceived value, while others are seeking something unique. However, retailers who specialize in estate jewelry also note that as the market increases in popularity, customers unfamiliar with the quirks of the estate market need to be educated and cultivated. In addition, finding quality goods is time consuming, and there is no guarantee that stock will suit customers’ tastes. But for those willing to put in the work, investing in estate seems to be paying off.

“The current economic climate has actually improved my estate sales, because I can give customers better value,” said Marlene Harris, owner of the Marlene Harris Collection in Pittsburgh, Pennsylvania. “If I buy from a bank when they settle an estate and I can get a good deal, I can pass that on. Also, there are a lot of people who do not want conflict diamonds, so they buy an old diamond.”

Conflict-Free Appeal
Social consciousness is certainly one of the estate market’s best selling points right now. “Our jewelry is conflict free, which is especially of interest to nuptial diamond customers,” said Suzanne Martinez, curator and co-owner of Lang Antique & Estate Jewelry in San Francisco. “Today’s customers are conscientious collectors and individuals are looking for the one-of-a-kind jewel that antique and estate jewelry provide.”

Value, coupled with the unique nature of the product, is another reason estate sales are healthy right now. “The economy has not affected the estate market at all,” said Corinne Meyer, co-owner of AE Jewelers in Oshkosh, Wisconsin. “I notice that people are spending a little less, but they are drawn to the price points and to the variety, especially in diamond engagement rings. Younger couples, in particular, will look at estate diamond engagement rings because they can get a better value.”

Helen Sher, president of Camelot Jewelers in Dunwoody, Georgia, has a separate estate section in her store called Cameo Estate Jewelry, which is owned by Doug Marlatt. She finds that the estate customers are comfortable with higher price points. “Prices are dropping a touch in estate jewelry, but the prices are not dropping as much as they could, because it’s a different financial category of customer that buys estate jewelry,” she said.

Challenging Expectations
Despite a demand for estate pieces, retailers who specialize in this market have challenges. In particular, customers drawn to an estate piece may not be ready to make the compromises involved in purchasing one. “I see people come to me looking for antique engagement rings from the 1920s and 1930s, but after showing them rings from that period, they are more likely to buy something in that style that is designed exactly for them,” said Amy Lawch, president of A.A. Benjamin, Ltd., Houston, Texas. “People want something specific, they want a certain color and clarity. I think the economy draws people to estate jewelry, because they’re looking for something old and comforting, but when they get to it, it may not be modern enough for them.”

According to Sher, the estate section consistently draws customers into her store, but they’re not always prepared for what they find. “Customers expect the estate jewelry to be lower priced, and it’s not, really,” she said. “And you won’t find 2- or 3-carat stones in estate. They’re not as plentiful. And there is the abuse some of this jewelry has taken.”

Stock and Trade
As the economy worsened in 2008, estate became more popular, and more people were looking to sell. “In 2008, every person who walked in the door was selling,” said Meyer. “It seems like we were buying 1,000 times more than we are this year. But last year, it was such a new thing. The amount of buying we did was just phenomenal.”

Still, getting good pieces is not always easy. “It’s hard to find great stuff at reasonable prices,” said Lawch. “I used to find great stuff in London, but had to stop because of the pound against the dollar. And clients in Houston want a bigger mix. I know people who specialize in just Victorian jewelry, and you can do that in New York, but here we’ve changed to have a mix. You have to adapt.”

In the end, estate is about what’s unique. “The thing I say is this,” said Harris. “No two relationships are the same. If you have a ring that is unique or unusual, that’s what sells it. Young people love the old jewelry. It’s innate.”

The Marketplace

• Round is the top-selling shape.
• The most popular carat weight is 1, followed by ½-carat stones and light carats, such as 0.80 and 0.90.
• SI1 is the top-selling clarity.
• H is the preferred color, followed by G.
• 14- and 18-karat white gold outsell platinum in most markets, though yellow gold is coming back slowly.
• The average price for an engagement ring, including stone and setting, is about $4,000.

Article from the Rapaport Magazine - August 2009. To subscribe click here.