Sales were inconsistent across the US as summer turned into fall. Some store owners said their numbers were a little up, and others were a little down, but all retailers across the board were anxious about cautious consumers. Millennial shoppers and online buyers also proved challenging as retailers struggled to drive traffic in-store. As September began, stores with already-thin margins were also keeping an eye on the possible impact of the China tariffs. Yet optimism, however fragile, was still the guiding voice, and hopes were high that the coming holidays would bring a much-needed respite from the year’s unstable pace.
‘Trending down’
For some stores, sales have been underwhelming in 2019 compared to last year. “The year has been trending down for us,” said Scott Stambaugh, owner of Stambaugh Jewelers in Defiance, Ohio. He explained that a major bridge closure in his community was partly to blame for the 3% slump compared to last year, but that there were other mitigating factors.
“Some of that sales trend is due to us discontinuing Pandora in March of this year,” he said, though he added that he was “still very happy” with that decision. “All in all, I am happy with our situation, as we are in a much better financial position. [And] traffic, while different, is still strong.”
Mixed bag
Other stores have seen a slight improvement, although not enough to make owners feel relaxed. Business in 2019 has been moderately good, according to Ken Stein, owner of Bensons Jewelers in Washington, DC. “We are a little ahead of last year,” he said, noting that he’d like to have a little more financial padding for when sales slump. “Money is always an issue. Diamond sales are lower, too.”
In Idaho, sales were erratic, which was a far cry from the predictably steady sales growth of 2018.
“It’s different this year, but it’s different every year,” said Lance Buttars, owner of Molinelli’s Jewelers in Pocatello. “Last year we had a big January, but not so much this year. Then we were off the first three months of 2019, and beat our numbers [year on year] for the next three months, which
is the opposite of last year. And August was not so good, but September is so
far, so good.”
Business was similarly inconsistent elsewhere in town, Buttars added. “I was talking to a local florist who said he saw only a fraction of the weddings he did last year. We also sold fewer wedding sets this year.”
Targeting millennials
Younger shoppers continue to present retail-marketing challenges. Reaching millennial customers, as well as online shoppers, is still difficult, Stein said.
“They don’t really like jewelry like people did in the past,” he observed, explaining that it was now harder to develop long-term relationships with jewelry clients. “They just need an engagement ring and an Apple watch, and they’re happy.”
Still other retailers have found ways to engage with online shoppers. “Largely, the internet is used as an educational tool,” noted Buttars. “People are still coming into the store. They know what they can get online, so we have to add value and make them feel like it’s worth it to come into the store. Bare-bones online prices are compelling for millennials, but they don’t know where to get rings sized or serviced.”
Stein said he expected the year to continue with sales slightly up, and hopefully without any dramatic downturns.
Buttars, however, was less certain. “Last year, I was confident we were going to be up, and this year I’m not so sure,” he said. “I have a feeling, and maybe that’s just about how many stores have closed, but there’s a feel of caution in the air. But as long as diamonds are the tradition, we’ll be okay. I’m planning for sales to be the same or better, and I’m optimistic.”
Source: US Trade Representative, Pandora, De Beers, Tiffany & Co., National Retail Federation (NRF)Article from the Rapaport Magazine - October 2019. To subscribe click here.