While most retailers continued to report fair, though not
spectacular, holiday 2017 figures, 2018 began more quietly, with lower sales
numbers and slower traffic. January is traditionally subdued for jewelers, but
February has been equally sluggish lately as customers move away from lavish
Valentine’s Day gifts and trend toward lower-priced items. And while numbers
for the year ahead are impossible to predict, retailers continued to be
cautiously optimistic that the industry was beginning to see the light at the
end of a tumultuous tunnel.
Slow but steady
Fernando Schlaen, general manager at Richard’s Gems &
Jewelry in Miami, Florida, had a decent December, but the upswing didn’t last.
“I thought that things would be better,” he said. “In January, it slowed down,
and February is really quiet.”
The year also started off quietly for Kara Nakamura,
marketing manager at Hal Davis Jewelers in Boise, Idaho. “We’ve had some really
great sales [in January], which made up for the fact that it’s been a little on
the slower side,” she said. “But it’s normal for us to have a slower month in
January. People get into health and fitness, and get out of the shopping mode.”
She added that her store had seen a substantial increase in
overall sales since moving away from traditional advertising and toward
targeted customer outreach in 2015. For example, instead of February print ads,
the store sends Valentine’s flower arrangements to customers who made major
purchases in December. The emphasis now is on client relationships, she said.
“We know who are our major players are, and we make sure they feel valued.”
Small tickets, better margins
In the Midwest, John Hayes, owner of Goodman’s Jewelers in
Madison, Wisconsin, reported middling holiday sales and a slightly more
positive start to 2018. “The 2017 holidays were down a bit from 2016,” he said.
“We had more tickets written, but the tickets we wrote were smaller. The flip
side is that a lot of that smaller product has better margins. January was
better, but it wasn’t up to par with two years ago.”
Hayes has been working on an updated advertising strategy as
well. “We do social media and radio, and whenever there’s special sections in
the newspaper, we join in that. We strongly support ‘buy local,’ and we
advertise in local Jewish and LGBT publications, plus a local Madison,
Wisconsin, magazine.”
No heart for Valentine’s Day
Despite the success of targeted marketing efforts, Nakamura
said Valentine’s Day was no longer an important holiday for her store.
“We always have one or two really good sales on Valentine’s
Day, but we don’t really hyper-focus on it,” she said. “A lot of people feel
like it’s a real forced day, and they feel negatively about it.”
Schlaen expressed similar sentiments. “Customers are
spending money throughout the year, but Valentine’s Day and Christmas [aren’t]
so great,” he said.
Gradual growth
Looking ahead, Hayes predicted the year would see slow
growth. “I think for 2018, we’ll be flat to about 2% up for both my store and
the industry as a whole,” he said. “But one sale will not make you rich or
poor. It’s a lifetime relationship.”
Schlaen, who has been in the business 34 years, said he was
seeing a continued culling of retailers, but that jewelers who loved their work
would last.
“The people who are in the industry for the money will
slowly get out, because it’s very demanding, and we work with single digits when
it comes to moving stones,” he said. “You can make more money in other
businesses. But if you’re in this for the love of it, then you’ll be okay.”
Article from the Rapaport Magazine - March 2018. To subscribe click here.