Status Quo Sales According to US Census Bureau data, total US retail jewelry stores sales were $30.536 billion during 2015, only a 0.007% increase from 2014’s $30.514 billion. Jewelry and watch retail sales showed a marked improvement during the first half of 2016, with each sector increasing 3.9%, or $30.34 billion and $4.02 billion, respectively, or a total of $34.35 billion. A major contribution to this improvement was the February through May results and June’s +3.5% increase, or an initial estimate of $5.64 billion. During May, sales at specialty jewelry stores increased 1.9% to $2.79 billion.

Closing Stores, Old Business Model According to the Jewelers Board of Trade (JBT), the total number of US jewelry businesses (retailers, wholesalers and manufacturers) that closed during 2015 increased 21%. Among retailer jewelers/repairers, closures increased from 612 to 760. On the upside, there was a 10.7% increase in new jewelry businesses during 2015, totaling 289, with the largest portion of new retailers (71) in the Southeast region. The year ended with 29,352 JBT listings in the US and Canada, a 3% decrease from 2014. According to National Jeweler, many storeowners are older adults, even Baby Boomers, and near retirement. Many don’t see the value of changing their business model to add digital media to their marketing programs, thus not attracting younger customers.

Uneven Performance The low-to-slow revenue growth for the jewelry industry is reflected in Q1 2016 results from Tiffany & Co, and its 9% decrease in same-store sales worldwide and 10% decrease in the Americas. Its 2016 year-over-year forecast is a low-single-digit decline. Although Pandora’s US sales increased 13% during Q1 2016 compared to Q1 2015, it closed accounts at 55 stores in the Americas during Q1 2016. The company will be adding more than 200 shop-in-shops at Jared the Galleria of Jewelry during 2016 The Swatch Group experienced an 11% decrease in worldwide sales during the first half of 2016. Signet Jewelers’ same-store sales increased 2% for the quarter ending April 30, with Sterling’s increasing 2% and Zale’s increasing 3%.

Jewelers’ Three-Year Trend in Product Sales, 2014–2016 Increase Remain the Same Decrease Gold jewelry 24.0% 43.0% 34.0% Silver jewelry 45.9% 37.8% 16.2% Platinum jewelry 17.0% 48.0% 35.0% Pearl jewelry 16.0% 41.0% National Jeweler (Product Pulse Surveys), January–June 2016

With This Ring According to National Jeweler’s May 2016 Business Pulse survey of approximately 150 retailers, the average price customers spent on an engagement ring was $6,400. The Wedding Report’s Q2 2016 consumer survey found an average of $3,360.   Participating retailers in the National Jeweler’s survey said a round center stone was the most popular shape, at 94%, with princess, at 3%, and cushion, 2%, distant second and third choices. According to National Jeweler’s March-April 2016 Product Pulse survey, 46% of participating retailers said their engagement ring sales and 44% said their wedding bands sales increased during the last 10 years.

Leveraging Luxury Consumers According to the YouGov Affluent Perspective Global Study of 12 countries and more than 5,100 affluent respondents, total luxury spending will decrease approximately 1% during 2016.   Of the 9 categories in the YouGov study, only travel (+10%) and fine dining (+5%) will increase while total fine jewelry purchases are forecast to decrease 11% and watch purchases 3% during 2016. The 2016 purchase estimates among affluent Millennials, however, are a 22% increase for fine jewelry and a 10% increase for watches. Total luxury spending by US affluent Millennials is forecast to increase 8% during the year.

Advertising Strategies Jewelers who are younger and tech savvy are more likely to be better prospects, as they need the combination of TV – to build brand recognition – and digital media to engage with Millennials to reach the wedding market and generate interest in jewelry and watches. With Christmas shopping starting earlier, jewelers can offer a progression of specials or discounts from late September through mid-November, including a coupon with an early purchase to be used only during the last week before Christmas for a last-minute gift. Jewelers can approach large, local businesses, especially those with a higher proportion of Millennial employees, and offer a program or discount as part of the employees’ benefits package, with quarterly seminars on how to choose jewelry and the 4Cs of diamonds.

New Media Strategies Jewelers should encourage bridal customers to upload photos of their engagement ring and/or a video of them telling their wedding story, their ring selection process and what their engagement ring/wedding band symbolizes in their life. Jewelers can host a contest on social media inviting customers and visitors to post photos/videos showing their pets’ jewelry. Ask everyone to vote the cutest pet/jewelry combination, with a coupon for all voters and a prize for the winner. With approximately one-third of all jewelry sales an impulse buy, jewelers should make use of geomarketing. It will allow them to reach people shopping nearby in a mall or on Main Street via their smartphones, and is a highly effective method to engage with Millennials.