As 2018 draws to a close, the economy has continued its upward swing — a good sign for luxury sales. That said, the push to digital and an increase in custom orders have proven challenging for stores, with the coming year promising to continue the movement toward personalization and omni-channel shopping.
The New York perspective
In the Big Apple, the upcoming holiday season was looking bright. “I feel pretty strongly that in New York City, the holiday season will be a good one, as it generally is impacted more by weather than anything looming in the larger picture,” said Anna Sheffield, whose eponymous store has branches in New York and Los Angeles, California. Sheffield added that while the former was moving to a new space in the city in the midst of the season, she was optimistic about the change. “We stand to attract new customers in a new location,” she said. “It’s all about knowing when the time is right, like when you were a kid jumping onto the merry-go-round.”
That’s not to say there aren’t challenges. “We’ve been seeing the rise of digital for a number of years, both with online purchasing and also a huge shift to mobile,” Sheffield noted. “I think online is an amazing opportunity for storytelling, but you want to translate that to brick and mortar in a way that shows who the brand is in real life, and fully engage with the experiential aspects of your unique selling proposition.”
The same or better
Paul Geiss, owner of Paulo Geiss Jewelers in Charleston, South Carolina, said he expected this year’s holidays to be about the same as 2018, sales-wise.
“We didn’t have a bad season last year, but nowadays in retail, no matter what you have, you never have what they’re looking for,” he said. “Half our orders were special orders last year.”
Eric Swanson, sales manager at Neustaedter’s Fine Jewelers in St. Louis, Missouri, was more upbeat. “Christmas this year is going to be much better than last year,” he forecast. “We’re looking to do 20% to 40% over last year.”
Swanson said he was seeing more customers with spending money, due to a high level of consumer confidence and low unemployment. “The country is doing better,” he said. “People are buying diamonds and are not curtailing their expenses to do that.”
Business ups and downs
Geiss, who will be retiring from his business at the end of the year, said retail had changed significantly over the years. “Sales are down from last year, and it seems like we’re getting less and less bridal business,” he observed. “It’s no fun anymore, and the profit has gotten to be so small. And it used to be that we had inventory, and people would buy what you have. But nowadays, people always want a special order.… And the millennials are buying cheap stuff and colored stones on the internet.”
Still, Swanson believes the outlook for 2019 is good. “You get ups and down in the economy, though,” he said. “So can we maintain this? Is it going to end? I think the country can keep it up for another two or three years, and then it will be like 2008 again.”
Article from the Rapaport Magazine - December 2018. To subscribe click here.