Rapaport Magazine

Retail Scope

Sterling and Zale Offer Testimony in ‘Brilliant’ Lawsuit
   Gilbert Hollander, Zale’s executive vice president, chief merchant and sourcing officer, testified in court regarding the lawsuit brought against the company
by Sterling Jewelers for misleading advertising, backing Zale’s claim that
its Celebration Fire diamond is “the most brilliant diamond in the world.” In its suit filled in the U.S. District Court in Cleveland, Ohio, Sterling requested an immediate injunction to halt Zale’s advertising.

   In its related court filing, Zale stated that Sterling did not successfully refute this marketing claim because doing so would mean contradicting its own marketing language regarding, for example, the Solasfera Diamond, which Sterling describes as “the highest-performing diamond in the world on GemEx BrilliantScope tests.”
   Zale also argued that the purpose of the case was to determine whether it had violated the Lanham Act, rather than industry standards. The act prohibits ads that are false or misleading and, as a result, hurt competitors’ business. Zale further argued that while its ad may be ambiguous, it is not a misrepresentation.
   “Because the ad conveys different messages to different people, it is ambiguous and cannot literally be false as a matter of law,” Zale stated in the brief. “As such, Sterling was required to provide evidence that consumers were actually deceived, such as reliable consumer surveys proving that the ad conveys the particular message Sterling alleges.”
   Zale deemed the survey conducted by Sterling’s expert witness unreliable in that its sample size was too broad and did not include prospective and actual diamond buyers and its questions were “incomplete” because they offered just three multiple-choice responses.
   In its own court filing, Sterling had argued that Zale’s claim of “most brilliant” is misleading because Zale is unable to define “brilliance” or an industry standard for it and its own test for brilliance relied upon an inadequate sample size and that the Celebration Fire diamond was tested against only some competitors’ stones. Sterling also claimed that Zale did not provide evidence of consumer perception to support an alternative interpretation. Sterling further contended that violates the Lanham Act since, despite Zale’s claim that the act does not apply as there is no standard for brilliance, the act does cite “misleading” ads as a violation, as proven by the differing responses to Zale’s own consumer survey.
   “The consumer who buys each Celebration Fire diamond gets an individual brilliance score for that stone, not an average score for the Celebration Fire line,” Sterling stated in its court filing. “To substantiate the most brilliant claim, Zale would have to test every individual Celebration Fire against every competing diamond in the market. Because each diamond is unique, brilliance cannot be generalized – there is no such thing as one brilliance for a line of diamonds – and Zale’s assertion that its most-brilliant claim applies to every Celebration Fire is false.”

Helzberg Launches Proposal App
   Helzberg Diamonds created a new smartphone application, the “Proposal Pro: A Complete Guide to Popping the Question,” that guides users in navigating their way through the engagement experience. The mobile app advises users on points such as “asking her parents” to “putting the perfect ring on her finger” and supports an automated ring sizer.
   In addition to educating users about the 4Cs, the app covers every aspect from helping consumers to create a proposal timeline to browsing locations to select the “perfect spot” to propose, according to the retailer. The company said it is the only application of its kind. The app is available at iTunes and Google Play stores.

Value Key for Luxury Consumers
   Unity Marketing’s latest Luxury Tracking Study found that the share of luxury consumers who purchased jewelry rose from 13 percent to 15 percent. While this measure of demand still lags behind the 18 percent tracked in 2010, it points to people’s willingness to shop once again for jewelry items. However, value is key, according to Pam Danziger, president of Unity Marketing.
   Given the current economic environment, even high-income consumers who can afford the real thing are opting for less expensive metal and gemstone options, as well as turning to discounters and other value-oriented retailers to make purchases.
   Danziger urges jewelry marketers to create strategies around the new realities of today’s jewelry customers — what they want, what they value and what features, benefits and experiences they are willing to pay more to obtain.

GILC Addresses Hydrophane Opals
   The Gemstone Industry & Laboratory Conference (GILC) formed an Opal Committee task force to identify useable nomenclature that could be applied to the newer hydrophane opals currently on the market. The GILC has determined that disclosure regarding this variety of opal from the Wollo district of Ethiopia is as follows:
   Type 1 Precious Opal Hydrophane
   Special Care Required: Hydrophane generally indicates a material that is absorbent when immersed in liquid. Keep away from cleaning agents, perfumes, oils and any liquids as they can be absorbed and may alter color and/or appearance. Avoid sudden and extreme temperature changes. Avoid steam and ultrasonic cleaners; clean with a soft cloth. 

Article from the Rapaport Magazine - January 2013. To subscribe click here.

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