Rapaport Magazine

Holding Pattern

U.S. August Retail Market Report

By Lara Ewen


The year is past its midway point, and though the upcoming presidential and other national elections are making everyone a little nervous, most store owners are finding themselves in a good place financially. Business has either been stable or much improved, and though fewer gift items are moving, bridal is strong. Moreover, stores that have devoted themselves to their social media pages, Pinterest in particular, are seeing real results, particularly with younger customers. With just a few more months to go before the elections, everyone is trying to focus on the positive, and plan for a strong end to the year, regardless of November’s outcome.

LOOKING UP

Most retailers are seeing decent sales in 2012, especially stores with a strong focus on bridal. “2012 has been steady,” said Judith Arnell, owner of Judith Arnell Jewelers, with stores in Portland, Oregon, and Chicago, Illinois. “People are still getting engaged and married, but they are not paying as much attention to other events in life such as birthdays, anniversaries, graduations, et cetera.”

Mike Butterfield, co-owner of Butterfield Jewelers, with two locations in Albuquerque, New Mexico, agreed. “Our bridal is doing well,” he said. “People still want to get married. So that is good. Our fiscal year ends May 2012 and we were up 3 percent for our fiscal year. June started a bit slow but we are up over the previous June.”

Other retailers are pleased by improving sales, but are still feeling the effects of the coming elections. Gary Gordon, of Samuel Gordon Jewelers in Oklahoma City, said 2012 is up 10 percent for him, but the coming election is making sales choppy. “Business has been more roller coaster-ish this year,” he said. “Days aren’t consistent.”

Tonia Leitzel Ulsh, chief operating officer (COO) of Mountz Jewelers, with three stores in Pennsylvania, said that she has yet to feel the effects of the upcoming presidential election. “So far there has not been a direct impact,” she said. “That will obviously change going into October and after the election.” For now, Ulsh is having a great year. “We are ahead of 2011 and on track to have our best year in our company,” she said.

This also has been one of the best years for Steve Quick, owner of Steve Quick Jeweler, which plans to open its third Chicago-area store later in 2012. “We have had record sales this year,” he said. “Our original store has now made its goal two years in a row, and for a 25-year-old store, that’s great. Our second store is doing really well too, and it’s become a very serious store on its own. And store number three will be completed in September, with its official grand opening later in October. I think it’s going to be touch-and-go for us for a while, in terms of attaining our goals. They won’t be handed to us, and we’ll have to be hitting on all cylinders to make it happen. But maybe after November, everything might start to get on a more positive track.”

SOCIALLY CONSCIOUS

One way that stores are working to get more customers and engage with their existing customers is through social media tools, such as Pinterest. “My son Daniel has become a true expert in this field,” said Gordon. “Because of his efforts, we have a huge presence in social media, including Facebook, Twitter and Pinterest. He connects with approximately 15,000 people a day.”

Ulsh is also serious about online efforts. “To stay in the forefront of the young bridal consumers’ minds, we started a Pinterest page in 2012, because the booming social networking site skews female and to a younger demographic,” she said. “We are now active on Facebook, Twitter, YouTube, and Pinterest, and we’ve seen good results, with people coming to our stores and mentioning specific jewelry or in-store events that they saw on our Facebook page. To keep the momentum going, we’re partnering with a jewelry-specific agency that specializes in social marketing. We feel that this is an effective and exciting new way to connect with our customers before the holidays.”

Quick also makes use of social media. “We have hundreds of pictures on Pinterest, and we’re involved on Facebook almost daily,” he said. “But Yelp is bringing in more people than anything else, overwhelmingly. People are using Yelp to find a jeweler, and people read these reviews.”

POLITICS AS USUAL

Even with help from online resources, election years bring an element of caution to the market. Until November settles things one way or another, the coming months may be slow. “I think the rest of 2012 is going to be soft, not over the top,” said Butterfield. “There’s still too much insecurity, at least in our part of the country. There is just a lot of uneasiness out there.”

Ulsh agreed. “With this being an election year, we are concerned about the last weeks of the year,” the all-important holiday shopping period. “It is impossible to predict the emotional aspect of the election, which, in turn, can affect the spending of the masses.”

Despite election-year jitters, there is real optimism in the air for the period after the election. Said Arnell, “We feel that sales will improve considerably beginning after the election through Christmas.”

 

The Marketplace

  • Rounds lead, with princess and Asscher cuts competing for the second slot.

  • Stones weighing just over 1 carat are as popular as stones coming in at just under 1 carat, with customers’ budgets being the final determining factor.

  • SI1 and SI2 are the best-selling clarities.

  • H-I is the top color range, though some stones as low as J and even L are starting to move more.
  • White 14-karat gold outsells all other metals, with platinum coming in second.

  • The average price for an engagement ring, including stone and setting, is $6,810.

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