Many shops are still struggling to deal with competition from online-native retailers, but it’s also becoming more common to hear of brick-and-mortar businesses that have learned to thrive in a digital environment by taking advantage of the consumer access granted by mobile and social media. In fact, 2018 might be the year the jewelry industry begins to shed its traditional problems and find a new — and lucrative — path forward.
Taking stock
Business in 2018 has picked up significantly compared to last year, at least for some retailers.
“[This year] is much better than 2017,” said Joseph R. Villarreal, president of Villarreal Fine Jewelers in Austin, Texas. “But it was lousy last year. So we doubled that this year, but that’s not saying much.”
Villarreal said 2017 had been tough for all retailers, diamond or otherwise. “Maybe one of the reasons last year was bad was because we got our new president,” he said, referring to Donald Trump. “Logically, that’s the only thing I can think of, because we’re never down, but we were down 35% last year, and that’s a lot.”
For other retailers, numbers have been even with previous years, but signs are pointing to a coming upswing.
“Business is flat,” said Michele Freeman, manager of Hegeman & Co. in Providence, Rhode Island. She said the street outside the store was under construction, which had led to reduced foot traffic and almost no parking. But she expects the improvements in her area to bring more local consumers and foot traffic.
In the meantime, she said, “we’re holding our own. My business is 85% bridal, and being in a college town, with the people who walk in here, my wheelhouse is the $2,000 to $5,000 sale. And my numbers have always been like that.”
Online vs. local
Yet the digital revolution has left many stores struggling to compete.
“The challenge is the competition for online sales, meaning the big web companies versus brick and mortar,” said Villarreal. “But millennials still tell me they’d never buy online, because they say they have to touch and feel their stones. They still prefer to go into a local store and shop. And then there are others who just won’t buy in a chain store.”
Freeman agreed that touch and personal interaction were critical for a younger audience. “[They] will come in and show you something on a phone,” she said. “But they don’t want to buy it off the internet until they can touch it first, and they want to use you as the place to touch it.”
Despite this, Freeman said she was no longer feeling pressure from online stores. “People show me things they got from Blue Nile, and I tell them they need to send it back, and they do,” she related. “The bottom line is, I need — and you need — to be comfortable with wherever you decide to buy. And if they come back to my store, they’re mine. And if they go to somebody else, fine. Because [they] still like to be treated with respect. And treating people with respect works with everybody.”
The New York perspective
In the Big Apple, sales have been good.
“[This year] has been fairly strong,” said Lauren Behar Shmueli, vice president of Lauren B Fine Jewelry and Diamonds in New York. “It’s probably the same as last year.”
She attributes her store’s steady strength to an enhanced digital presence. “We’ve pioneered a new experience for our clients with social media and worldwide outreach,” she said. “This is something we’ve been doing for six years. It’s not just the internet. There’s our website, social media, Instagram, YouTube. Different platforms come together to tell the story of our brand. We’re talking to the generation that’s using their cellphones, and we have a very good finger on the pulse.”
Article from the Rapaport Magazine - June 2018. To subscribe click here.