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Eileen McClelland

What Jewelers Must Understand About Millennials, and 8 Other Takeaways from AGS Conclave

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After a few days immersed in education at the 2018 AGS Conclave, I’m eager to share some highlights from sessions I attended.  One theme is the fact that as demographics and lifestyles are changing, opportunities for growth and new directions arise along with all of the well-known challenges.

MILLENNIALS MEAN OPPORTUNITY. Retailers convinced that millennials don’t buy diamonds may not have all the information. In fact, millennials, who are now 24 to 38 years old, are much more likely to buy diamonds than any older generation, according to research from the Diamond Producers Association. Millennials spent $16 billion on diamonds last year, of which 50 percent was wedding and engagement jewelry. There are big numbers there, and big opportunity. By 2020, the generation’s disposable income will exceed $1.4 trillion. DPA focus groups reveal that millennials especially find value in the authenticity and rarity and individuality of diamonds. — From “Focus Group Confidential: Surprising Things We Learned From Millennials,” presented by Sarah Gorvitz, strategic communications and insights lead for the Diamond Producers Association.

CATER TO SELF-PURCHASING WOMEN. Women’s roles, attitudes and empowerment are affecting all consumer purchases. When it comes to jewelry, women are celebrating myriad moments in their lives, which can be unrelated to family or relationship milestones. A 2017 diamond acquisition study revealed that bridal represented 24 percent of diamond purchase value in the U.S; gifting, 47 percent, and self purchasing, 29 percent, which reflects a 50 percent increase over the past decade. Women’s spending power has increased, and they are buying more diamond jewelry for themselves. – From “De Beers Group Insights to Influence Your Marketing and Selling Strategies,” by Charles Stanley, president of Forevermark U.S.

CUSTOM IS KEY. Jewelry sales are growing ($91 billion in 2017) but jewelry sold by “other sellers” is rising much more rapidly than independent jewelry store sales. There are 91,000 places to buy jewelry but just over 23,000 jewelry stores. Today, 15 percent of engagement ring sales are custom; a decade ago, it was just 5 percent. So the ability to customize your offerings is key to increasing your sales. – From “State of the Jewelry Industry: Facts, Figures and the Future,” by Harold Dupuy, VP of strategic analytics at Stuller.

RECOGNIZE CASUAL TRENDS. Dress has become more casual and jewelry needs to reflect that trend, too. Remember that business casual is now the norm for office workers, while those working at home are likely to be wearing yoga pants and T-shirts. Make sure you can offer casual, wearable jewelry styles that fit today’s culture.  “Very heavy gem-set jewelry is the equivalent of Queen Anne dining sets or heirloom silver they have to polish. But it doesn’t mean they don’t want expensive jewelry. They just don’t want it to look like their parents’ jewelry. They value story, authenticity and individuality. You can’t count on younger customers growing into the taste for traditional fine jewelry.” – From “Too Old To Start Over But Too Young to Retire? Strategies to Balance Risk and Reward Amid Constant Change,” by Hedda Schupak, industry analyst and editor of the Centurion Newsletter.

HIRE CAREERISTS. It’s possible to shape millennial hires into serious sales people, but you’ve got to take hiring seriously yourself, first. That means no shortcuts or impulse decisions made to quickly fill a staff gap. Figure out who the job candidate is before he or she shows up for the first interview.  Joshua Pruschen, manager of Maxon Fine Jewelry in Springfield, MO, interviews each candidate three times. But before the first interview occurs, he asks each candidate to take a personality and skills assessment. If they’re joining the staff, he wants to make sure they’re interested in and capable of committing to a career. – From “Management 101.5, Managing Effectively, Efficiently and With Confidence.”

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EDUCATE SHOPPERS ON DIAMOND SHAPES. The appeal of a diamond shape to an individual seems instinctive, says jewelry designer Jade Lustig. Lustig is founder and creative director of Jade Trau, and a fifth generation diamantaire. If you’re selling a diamond ring, figure out which shape your customer is naturally attracted to. “A girl who wants an emerald cut doesn’t even see the other shapes,” Lustig says. “Her eyes glaze over.” Diamond shape should be a basic of everyone’s education, she says. – From “The Majesty, Mystery and Miracle of Diamonds: Why Jewelry Designers Love Working With Them,” moderated by Deborah Marquardt, chief marketing officer of the Diamond Producers Association.

MAKE EYE CONTACT. Studies show that 75 percent of the time the client is making eye contact with the seller – trying to assess their honesty — while the seller is looking at the client only 40 percent of the time.  If you were to increase your eye contact 50 percent or more, your credibility automatically goes up. But don’t do it 100 percent of the time – that’s just weird. – From “Sales Influence: Find the Why in (How People) Buy,” by Victor Antonio.

SLOW ‘EM DOWN. How can you get repair clients to look at jewelry while they’re popping in and out of your store to pick up or drop off repairs? In some strip center stores, it’s tough; a customer can literally walk down the middle and zing — right to the service desk. Consider adding an island, to create more of a flow around the cases. “You can’t make people look at things, but you can slow them down on their rush to pick up whatever the are there for. There may be a way to reuse your existing cases to create more of a meandering path, or maybe buying one new case would make it work.” – Interior designer Ruth Mellergaard of Grid 3 International, from “How a Store Renovation Improves the Customer Experience,” moderated by Trace Shelton, editor in chief of INSTORE.

PROTECT YOUR WORK. Any original work of artistic expression qualifies for copyright protection.  If a jewelry designer creates earrings in the shape of a bumblebee, for example, the designer can’t stop someone else from creating their own interpretation of bumblebee earrings. But a copyright can protect the specific design. The copyright is automatically secured when the work is created and fixed in a tangible medium. Notice of copyright is not required in the U.S., but filing for registration with the copyright office will help you prove you had the design at a certain date. To apply electronically, registration costs $35. JVC has published a guide titled “I Have An Idea! JVC’s Guide to Intellectual Property Law.” – From “Intellectual Property Laws for Jewelers,” by Sarah Yood, senior counsel for the Jewelers Vigilance Committee.

Eileen McClelland is the Managing Editor of INSTORE. She believes that every jewelry store has the power of cool within them.

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Eileen McClelland

GOB Sale Is This Jeweler’s First Discounting Event in 46 Years

At 74, Buddy Bear says it’s time to retire his long-running, one-man show.

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Buddy Bear

THROUGHOUT 46 YEARS in business, Buddy Bear never had a sale. He just didn’t like the idea of discounting.

But he knew when he decided to retire this year, he’d have to have his very first, a retirement sale that wrapped up June 29 in his Merion, PA, store, Buddy Bear Jewelers.

One practical reason he’s calling it quits now, at age 74, is because the building was being sold and he didn’t want to commit to a long-term lease.

Another reason is that tastes have changed, and he has had a tough time selling his statement designer pieces to millennials.

“Millennials who do come in are not customers who understand me,” he says. “I’m a dinosaur. They don’t want my one of a kind, large pieces.”

Bear’s given name was Harry Bear, which hadn’t gone over well in elementary school. Instead, he began using his nickname, Buddy. He had initially planned to name his store, Harry Alan Jewelers, a combination of his first and middle name because he thought it sounded more sophisticated for a jewelry store. But after his family and friends protested that idea, he relented and stuck with Buddy Bear Jewelers.

Bear, a longtime member of INSTORE’s Brain Squad, specialized in designing what he calls “transformers,” jewelry that can be taken apart and combined with other pieces to create an entirely different piece. Bar pins can come apart to become earrings, jackets, or pendants for pearl necklaces. Bracelets can become rings. He also spent years engineering and perfecting hinges that allowed pendants to lie beautifully on the neck.

“Up until three years ago I did my own manufacturing,” he says. “I cut my teeth on making one-of-a-kind pieces. You have to be creative. I didn’t copy stuff. I made my own models. I didn’t want to be influenced.”

Now millennials tell him they want to design their engagement rings themselves, but what that means, Bear says, is simply a CAD/CAM project. “I didn’t want to have to reinvest and learn that. And the mark-up in diamonds is so darn little now that you make your money on the mounting. All I can do is show them 35 styles of halos from a catalog. But it becomes too much work for so very little money.”

Being a one-man show got old, too, and he had fought some health issues in recent years.

“Had they not sold the building, I was struggling any way and I was killing myself,” he says.

“It used to take me two and a half hours to set up and one and an hour and a half to break down every day. I’d get here at 6:30 or 7 in the morning just to get ready to open at 10. In the last three or four years, I could sit here for a week and only see the mailman.”

Before decided to retire, he had cut back his work days to four.

A low point in his career was the 1999 robbery that wiped out half a million dollars in inventory, including customer repairs. “They caught the guys and I went through the trial he says.

Still, he says, despite the challenges and tribulations, he has loved his long tenure in the business, which he first learned from his father-in-law in Miami. He’s particularly proud of the jewelry industry design awards he piled up throughout the 1990s, including honors from the AGTA’s Spectrum Awards, the American Pearl Design Competition and the Pennsylvania Jewelers Association.

“I got a great deal of satisfaction out of winning awards within the industry,” he says. “It meant that fellow jewelers have respect for me. I’ve made a lot of good friends.” He’d also been a member of the American Gem Society for 22 years and is an alumni of the GIA.

Another highlight was working with customers to design special pieces he knew they would cherish as heirlooms.

“I’ve had people get engaged in the store. I’ve had couples break up in the store. If you’re in the business long enough, you have that happen.”

When it came to the retirement sale, he knew he couldn’t go it alone. He was referred to sale-event expert Chuck Frey of Charles Frey & Company, who came to the store to meet Bear and prepare for the sale. It turned out to be the perfect fit for Bear. “We had a connection from the beginning and it’s the best thing I ever did,” he says. “The supervisor they sent me was like sending me a brother. Joseph White has been in the industry for decades. So charming. So many sales he made I never could have.”

Bear’s best advice for fellow jewelers?

“It doesn’t matter what decision you make,” he says. “The most important thing is to make a decision. Then put all of your energy behind it. Too many people make a decision and then are unable to put the work behind it to make that succeed.”

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Eileen McClelland

First JA Convention Tackles Weighty Issues

Focus of July event is on education and technology.

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JEWELRY RETAILERS, DESIGNERS and manufacturers looking for answers to burning questions about the state of the industry might do well to attend Jewelers of America’s first national convention, July 28-29 at the InterContinental New York Barclay in New York City.

Organizers have created an educational lineup with unique content as well as hands-on technological help. The event is also timed to coincide with Women’s Jewelry Association Awards for Excellence, July 29, and American Gem Society Circle of Distinction dinner, July 30.

“It’s designed to be a really focused, two-day, high-level educational forum for our members and potential members,” says David Bonaparte, president and CEO of Jewelers of America.

So if, for example, you’ve been lying awake at night, staring at the ceiling and wondering what to do about lab-grown diamonds that may infiltrate your inventory, visiting the Diamond Detection Lab during the Jewelers of America National Convention may ease your insomnia by demonstrating a variety of state-of-the-art solutions.

“With so much news and focus on lab-grown diamonds, with new technologies overseas and the ability for manufacturers to produce everything from man-made melee up to a carat and over, we’re seeing that there are issues of detection that present a real need in the industry,” says David Bonaparte.

“The worry is that some goods would pass through labs and go undetected.”

Over the years, however GIA, DeBeers and others have begun to produce ever more sophisticated desktop equipment that makes sending every diamond or potential diamond to an external lab unnecessary.

“There are now devices you can acquire and use to make sure that what you are buying is what the seller says it is,” Bonaparte says. “It’s a great way to see what’s the latest and greatest out there.” The goal of the Diamond Detection Lab is to introduce retailers and diamond dealers to the equipment that is available to them in a simple, user-friendly way.

JA has also curated a group of technology providers in a casual, interactive environment for a Retail Innovation Lab that includes a wide variety of tech options. “I think the most important issues are inventory management and omni-channel selling, so you don’t have your capital just sitting in a case,” Bonaparte says. “Inventory management is always a huge challenge for retailers, especially for the mom and pop retailer; and our demographic is 92 percent single store mom and pop retailers.”

Beyond technology, high-level discussions are planned on geopolitical finance, macroeconomics and legislative action.

“We have Charlie Cook of the Cook Political Report who is a one of the leading pollsters in the country who will talk about politics and what the election will mean to businesses,” Bonaparte says. “We also have the U.S. State Department coming to talk about the Kimberley process and responsible sourcing. It’s really unique content that we’re hoping is appealing not only to retailers but to manufacturers as well.”

Another unique aspect of the convention is that attendees won’t be distracted by making appointments with vendors between seminars. “There are great events out there, and they deliver a lot of content and value, but there are really not that many that don’t have a show attached to them,” Bonaparte says.

Retail Innovation Lab exhibitors include:

  • Abbott Jewelry Systems produces a comprehensive software solution to manage retail jewelry stores called the Edge.
  • Buyers Intelligence Group™ designs solutions for merchandising challenges facing retail jewelers and manufacturers. BIG’s online platform provides data analysis tools to help clients understand their business and strategically plan their profitability.
  • Fire Polish Diamonds has developed The Fire Polish cutting technique, which is protected by five U.S. and international patents. By cutting Nano Prisms™ (diffraction gratings) on the pavilion of a diamond, Fire Polish is able to increase the dispersion and scintillation of any diamond without affecting the diamond’s cut or brilliance.
  • GPShopper is a mobile app developer for retailers, empowering brands to improve the customer shopping experience through multiple touch points. Synchrony acquired GPShopper in 2017 to create new mobile solutions for its retail partners.
  • JewelTrace by Spacecode is an RFID-powered data analytics and inventory management solution for jewelers.
  • Podium is a rich communication platform for local businesses. It’s the simplest way to collect reviews, get found online, and talk to customers in real-time through text.
  • Outernets converts static walls, glass and displays into interactive, customizable digital experiences.
  • Smart Age Solutions is a digital marketing agency specializing in the fine jewelry industry partnered with Review Alert. Smart Age Solutions also advises, conducts webinars, and provides unpublished data from Google for its clients.
  • Virtual Diamond Boutique is an interactive app platform to source a diverse global inventory of diamonds, colored gemstones, jewelry and lab-grown diamonds. It’s designed to be easy to use on a desktop or on any mobile device.

For more information, visit here.

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Eileen McClelland

AGS Conclave Education Shines Light on “Female Self-Purchasers”

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Jewelers of America is working with the jewelry industry as a whole to grab the interest of affluent young women, and focus it on fashionable, fine jewelry.

The goal is to launch a generic advertising campaign to generate awareness and affinity for consumer jewelry purchases that would be on the level of the “Got Milk” ad campaign.

Dave Bonaparte, Amanda Gizzi and Molly Fallon of the Jewelers of America, along with industry consultant Mark Smelzer, have been working over the past two years to bring such a campaign to life. They outlined their progress during a session called “Update on the Jewelers of America Consumer Marketing Initiative” during the American Gem Society Conclave last week in Seattle.

“Let’s come together as an industry to tell the same story,” Fallon said. “By promoting this, everyone should benefit.”

The tagline they’ve begun to test is called “Another Piece of Your Story,” developed by the advertising firm Cramer-Krasselt, and based on the idea that there’s an emotional connection with jewelry that’s far different from how consumers relate to any other luxury product. Each piece of jewelry a woman chooses to wear becomes another piece of her identity.

And of course, affluent, self-purchasing women are recognized as having largely untapped potential in the jewelry industry.

Working with a market-research firm, they identified one target audience of 30-something, jewelry enthusiasts, married with children, living in a city or suburb, with a higher household income. They represent 8 percent of the population.

The other target is 20-something women, who are single, with a higher household income who have been largely indifferent to jewelry. They represent 11 percent of the population.

Also integral to the campaign are the following research points:

Authenticity is a top-ranked value among women.

Wearability is important as the culture becomes more casual: 40 percent of women 18 to 34 like to mix and match expensive pieces with inexpensive pieces.

Sixty-eight percent of women 18 to 34 buy fine jewelry to treat themselves, an activity they see as empowering, personal and also view as an investment strategy.

For example, women who buy diamonds for themselves today represent one-third of all diamond jewelry sales in the U.S., a $43 billion diamond market that grew 4 percent in 2017, according to De Beers Group data.

Harold Dupuy of Stuller, who spoke in a separate Conclave session about “Jewelry Industry Insights,” said that the average sales ticket in that category is $1,300. Generally, women are buying on impulse or for a personal milestone. Nearly half are buying fine diamond jewelry with no specific occasion in mind.

The Diamond Producers Association is also focused intently this year on female self-purchasers with “For Me, From Me,” its third wave of the Real is Rare, Real is a Diamond marketing campaign.

Conclave featured speaker Kelly McDonald said that women who like what they buy – no matter what it is — also have a multiplier effect. “Women are exceedingly enthusiastic about sharing whatever they like or don’t like. They’ll tell a million people either way. Women trust other women, even women they don’t know.”

Appropriately, the JA ad campaign will reflect that research by including a focus on influencers as well as more traditional forms of marketing.

JA is currently seeking funding from within the jewelry industry to test this ad concept over the summer in a single market in Los Angeles, representing five zip codes with a high percent of JA jewelry store members, a high household income, a high percentage of millennials and a high amount of social conversation that focuses on jewelry.

Matthew Tratner, GIA’s global director of business development, says a successful generic ad campaign can help the whole jewelry industry. “If more jewelry gets sold, it helps everyone in the room.”

For more information, contact Amanda Gizzi, director of PR & Events for Jewelers of America, agizzi@jewelers.org. To become a sponsor, contact Mark Smelzer, mark@marksmelzer.com

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