Retail Scope

RAPAPORT... The last stop for diamonds is the retail store. Here is a behind-the-scenes look at what is happening at retail in the U.S.

NRDC Names Fortunoff CEO
NRDC Equity Partners appointed Charles Chinni, a former general merchandise manager for home, family footwear and women’s accessories at J.C. Penney, as chairman and chief executive officer (CEO) of Fortunoff, the parent company announced. NRDC acquired Fortunoff through its Lord & Taylor subsidiary for $110 million in March after the jewelry and home furnishings retailer filed for Chapter 11 bankruptcy. Chinni’s previous positions include a twenty-six year stretch at Macy’s, where he was the president of merchandising responsible for home, cosmetics, lingerie and fine jewelry. He also served as executive vice president of merchandising for the Kmart Corporation and chairman and CEO of West Coast bed and bath retailer Stroud’s. NRDC also named Donald Watros Fortunoff’s vice chairman. Watros currently serves as NRDC’s managing director of retail operations.

Zales Adds Online Ratings to Website
Zales and Gordon’s Jewelers adopted technology from Bazaarvoice for online ratings and reviews. Bazaarvoice’s tools allow online shoppers to provide product feedback, which will enable the Zale Corporation to mine customer opinions online and assess their comments against marketing and merchandising strategy. Recent research from Bazaarvoice and Keller Fay Group showed that 79 percent of reviewers provided feedback in order to reward a company, while 70 percent wanted to help a company improve the products they carry.

Macy’s and Finlay Extend Contract
Finlay Enterprises extended its counters contract with Macy’s Inc. by two years. Finlay, which operates licensed fine jewelry counters in department stores and stand-alone jewelry shops, stated that its contract with Macy’s is now in effect until January 29, 2011. The deal offers some consolation for Finlay after it was notified by Lord & Taylor that their jewelry counter contract would not be renewed when it expires on January 29, 2009. Lord & Taylor stated that it would run its own jewelry counters after NRDC Equity Partners, its parent company, unveiled plans to take over Fortunoff. Finlay Enterprises signed the Macy’s deal through its subsidiary, Finlay Fine Jewelry Corporation. The number of Finlay locations at the end of fiscal 2007 totaled 794, including 69 Bailey Banks & Biddle, 32 Carlyle and five Congress jewelry stores.

Helzberg Diamonds Cuts 21 Jobs
Helzberg Diamonds cut 21 positions at its North Kansas City headquarters, a 9 percent staff reduction. The company eliminated seven unfilled positions and is offering severance packages and outplacement assistance to 14 employees, including managerial and salaried professionals, as well as hourly associates. Helzberg Diamonds had about 225 positions at 1825 Swift Street. Marvin Beasley, chairman and chief executive officer (CEO) of Helzberg, stated that the cuts were an expense control measure. The company has more than 2,500 employees and over 260 retail stores across the country, but has no plans for further cuts. Helzberg, a subsidiary of Berkshire Hathaway since 1995, was founded in 1915 and is known for its “I am loved” buttons.

Graff Sells 70 Carat Diamond
Laurence Graff sold a 70.12-carat yellow diamond for $11 million (EUR 7 million), or $156,874 per carat. The sale was made to an undisclosed European buyer at TEFAF, the European Fine Art Fair in Maastricht, Netherlands. A spokesperson for Graff described the diamond as an emerald-cut, fancy intense yellow diamond set in a platinum ring with two white diamonds, each weighing 1.8 carats. Francois Graff, the company’s managing director, remarked that the sale was a reflection of investor preference for real assets.

“Gold Month” Turns Five
The industry-wide promotion “May is Gold Month” (MIGM) is in its fifth year and co-sponsors World Gold Council (WGC), Jewelry.com and the Richline Group will launch a national retail promotion with Belk, QVC, Ben Bridge Jeweler, JCPenney, Jewelry Television, Macy’s, ShopNBC, BJ’s and Sterling Jewelers Inc. The stores will feature new jewelry collections to increase gold sales for the month. The promotion will also raise funds for Jewelers for Children through a sweepstakes hosted on Jewelry.com. The sweepstakes offers consumers the chance to vote on and win their favorite designs, with Jewelry.com making a contribution of ten cents for each completed entry, up to $50,000. A national media campaign in Elle, Good Housekeeping, Harper’s Bazaar, InStyle, Redbook and People will support the promotion with the online sweepstakes supported by digital marketing. Independent retailers can download the MIGM logo and point-of-sale materials from WGC’s website, www.marketing.gold.org.

GJEPC Plans Indo-U.S. Seminar
India’s Gem & Jewellery Export Promotion Council (GJEPC) announced that it plans to host a delegation of U.S. jewelry retailers at the second Indo-U.S. Jewelry Business Relationship Seminar in September 2008, following the success of a similar event in October 2007. The conference will take place September 8 to 13 at the Marriott Renaissance Hotel in Mumbai and will include teams from the executive suite and head buyers from some of the largest jewelry retailers, the group reported. The first two days of the conference will include a series of educational speakers and group discussions addressing key business issues impacting both U.S. retailers and India’s jewelry manufacturers. The agenda also includes a series of “speed dates” in which the retailers and 20 leading manufacturers will have half an hour to review select product lines, discuss their business needs and issues and then decide on initiating the next phase of the conference meetings.

At the end of the second day, based upon “wish lists” developed by both the retailers and sponsors, the GJEPC will pair up conference attendees for two days of two-hour meetings at selected factories around Mumbai. The retailers will have a chance to meet with a variety of sponsors’ quality control managers, jewelry designers, inventory managers, heads of shipping and their financial counterparts as they tour the factories that sparked their interest, GJEPC explained. Rick Bannerot, managing director of R&B Partners, LLC, has been retained by the GJEPC to help develop and coordinate the conference.

Joseph Schubach Launches Design Contest
Joseph Schubach Jewelers of Scottsdale, Arizona, is opening up its doors for a jewelry design competition to engage online customers and highlight the jeweler’s custom designs. Photos of each entry will be posted in the contest gallery and public voting for the best design will begin in May. The owner of the design that receives the most votes will receive a $2,000 credit toward a purchase. The first 25 customers who purchase a custom-designed piece before April 15 will receive a 20 percent discount and their design will automatically be featured in the contest.

Joseph Schubach, the company’s chief executive officer (CEO), is also blogging on the site, with an invitation to customers to submit questions. Over time, Schubach expects to feature news and information on jewelry shopping. Customer service is available via live chat. The initiatives are intended to be an interactive experience, Schubach stated.

Gitanjali Group Continues Acquisitions
The Gitanjali Group expanded with the acquisition of two new businesses — the retail business of Renaissance Jewellery, which includes Lucera, and Trinity Watch Company. Gitanjali says it plans to open five new Lucera stores in India this year. The Mumbai-based diamond and jewelry company has joined with a string of brands in the past few months. It bought Nakshatra from the Diamond Trading Company (DTC) in January and formed a joint venture with Italy-based Mariella Burani Fashion Group (MBFG). The company also teamed up with Armo Netherlands Finance to import Morellato jewelry and other products into India.

Article from the Rapaport Magazine - April 2008. To subscribe click here.