2016 was “undoubtedly a challenging year” for the jewelry industry, and to succeed in 2017, retailers will need to carefully tailor their products and marketing programs to their target customers, according to the Jewelers Board of Trade.
“While continuous improvement in economic indicators such as unemployment and consumer sentiment contributed to solid growth in retail sales for the holiday season and for the year as a whole, many jewelry producers and retailers were not beneficiaries of the stronger economy and the American consumer’s desire to spend,” JBT President Anthony Capuano wrote in a recent state-of-the-industry report.
JBT noted several observations from its members regarding 2016, including:
- “The year was okay, but expectations were modest in the first place.”
- “Traffic was down.”
- “There was no hot new product or style to generate buzz, enthusiasm or draw people into the stores.”
JBT highlighted several trends to be aware of in 2017 and beyond:
- There will be consolidation throughout the supply chain. “Demographic and economic factors will favor mergers and business discontinuance,” according to the report.
- Closings of mall anchor store will affect the entire retail industry. “Jewelers located in mall locations will see their prospects decline as anchor stores or entire malls go dark,” JBT stated.
- All through the supply chain there will be a search for responsible, stable partnerships as the importance of critical mass increases.
- “Mine to market” programs will increase in number as consumer marketing efforts focus on responsible sourcing and chain of ownership.
- Transparency in provenance and production will continue to be a marketing opportunity.
- The role of synthetic diamonds will evolve. Prices will decline as more companies start or ramp up production, which will likely lead to a two-tiered “created versus mined” market.
- Jewelers will benefit from “associating the purchase with the experience.” According to the report, “Good jewelers will know their markets and tailor both products and marketing/sales program to their targets — millennials, ethnic groups, etc.”
- Consumers will increasingly expect retailers — in-store or online — to remember what they buy. “Personalization with data and technology – ‘artificial intelligence’ – will be refined and employed increasingly in the store,” according to JBT.