How manufacturers are making the metal more accessible for consumers.
Platinum is still a hugely desirable metal but its price has made it out of reach for some budgets. However a number of manufacturers are working to deliver product that hits lower price points through lighter profiles, direct sourcing and flexible sales techniques to make sure retailers never miss a sale due to price. Rachael Taylor reports.
As metal prices have escalated, trends in jewellery have led towards plating base metals or silver with gold and platinum to give that precious look without the price tag. But it would seem that while budgets are still tight, there is a real desire for jewellery made with the real thing rather than an illusion of platinum or gold and manufacturers are getting creative in order to deliver lower price points.
Platinum is the priciest of the precious metals and often the one most desired by luxury jewellery shoppers, particularly in the bridal market. The price of platinum has been fluctuating throughout the past 12 months and while prices are not currently as high as they have been over the year, the price is up on this time last year and Ruth Donaldson at The Platinum Guild International admits that the price of platinum jewellery can be intimidating for shoppers.
“While consumers still aspire to own platinum, sometimes while they are carrying out their research they are deterred from visiting a store because the price of platinum can appear daunting,” she says.
To counter this, there is a raft of companies working to offer products that still use platinum but that do so in a price-sensitive way to fit into consumers’ budgets. Donaldson believes that building up such an offer is crucial to retaining sales and is advising retailers to consider such products so that they can open up their platinum offer to a wider range of shoppers, rather than alienating all but the ones with the most flexible budgets.
“By introducing lower price points in a platinum inventory retailers can attract a larger customer base as well as having the means and leverage to increase transactional value as price differences are lower,” she says. “As budget is so crucial in the bridal purchase process this opens up more opportunity for retailers while retaining their prestige as a high-quality jeweller working with the finest materials.”
John Ball, sales director at wedding ring manufacturer Brown & Newirth, says that his company is geared up with a wide range of ring profiles to ensure that its retailers need never miss out on a sale because of a budget issue. If a customer likes a particular style of ring but needs it to be cheaper, then the retailer can refer back to the manufacturer for a lighter profile that will deliver the same look but at a lower price.
“We cater for everybody and at the moment we do a huge amount of training with our retailers about this,” says Ball. “If it’s down to price, it’s all about selecting the right profile. That customer should not leave the store because of a price issue.”
As well as plain rings, Brown & Newirth is working on offering design-led platinum rings that are still commercially viable. It recently unveiled a design at IJL called The Three Graces, created by in-house designer Juraj Vyrostek, which was named the winner of the Retailers’ Choice Award in the PGI’s Platinum Trail initiative at the show and was highly commended for the Most Commercially Appealing Design award.
The tri-set is simple but attractive with a slim plain platinum wedding band, matching diamond-set half eternity band and a three-stone diamond engagement ring with an open-style, raised setting. The cost prices for the rings are £290 for the wedding band, £478 for the eternity band and £829 for the engagement ring.
Pricing is important in platinum jewellery sales and with fluctuating prices, keeping track of costs can be confusing for both retailers and consumers. Hatton Garden-based jewellery company Emdico believes it has found a way round this by creating a three-tiered pricing system.
Emdico has been creating affordable platinum designs for the past eight years but has always limited its distribution to existing customers – Emdico also sells a range of other products including loose diamonds – but last year it made the decision to widen its distribution and hired former Brown & Newirth sales consultant Tony Specterman to take it out on the road and also exhibited the range at IJL this year.
“We’ve never had a rep on the road before and Tony has opened up a lot of new accounts for us, people that we didn’t know [previously],” says Vivek Khandelwal of Emdico.
Khandelwal says that the reaction from retailers has been astounding and Emdico has been improving and expanding its range of affordable platinum based on retailer feedback. Originally the range was limited to rings; it has now improved these rings by making them all wedfit style and at IJL introduced earrings and is now working on a range of pendants. “We thought it would be good to have a range that people could buy into without thinking too much about it,” he says.
The jewellery, be it rings or earrings, is bracketed into three price bands – A, B or C. All jewellery in the A range has a cost price of £295, B carries a cost price of £495 and C is £795, with all prices including diamonds or any other stones used in the designs. Khandelwal believes that by structuring the prices so simply it will help retailers and consumers.
“The category system has been the other selling point [as well as the price],” he says. “Within A there might be 50 different styles of earrings or rings but each style within A is £295, and so on. It is very clear pricing and it makes it easy for the staff.”
Khandelwal says that Emdico manages to keep its prices so low through a mix of using less platinum to make pieces lighter “but not too lightweight”, lowering its margins, buying diamonds “correctly” and producing the jewellery itself in its own factory in India where it can control costs.
While Khandelwal believes that there is much more work to be done, the company has had an impressive pick up and now has upwards of 40 accounts in the UK within a matter of months. “Most people that Tony has seen have ordered, whether it’s been two pieces or 50 pieces,” he says. “There was a few very high-end shops that ordered it as well, people that sell Patek Philippe watches at £50,000 or £100,000. They don’t want people walking out of their shops without anything if they only have a £1,000 to spend. Your £1,000 sale today could be your £5,000 sale in the future.”
The £1,000 mark is an important price milestone for retail chain Green + Benz. In reaction to customer feedback it has worked with Domino to create a range of diamond-set platinum wedding rings that retail for £1,000 or less and the initiative has been a huge success.
The retailer has branded the line The Shakespeare collection and has given it full prominence in the shop windows – a bid to attract price-sensitive customers in who may feel intimidated about having a smaller budget.
“Every month we conduct lost sales analysis and this has come through,” says Green + Benz owner Helen Dimmick, referring to previously losing out on customers with a budget of £1,000 or less. “We had to wait to fill this gap until we found a great quality offer and we found it at Domino.”
Domino has created two platinum engagement rings that carry these sort of prices within a collection that it collaborated on with the PGI. It also says it has a huge variety of platinum wedding bands that fit the sub £1,000 price point.
The lower priced engagement rings are the Lotus design, which has a 4mm band with a HSI diamond for just less than £1,000, and the Entwine ring, also with a 4mm band and HSI diamond that comes in at just a little over £1,000.
Building up a platinum offer that caters for lower price points does not belittle the rarity and luxury of platinum, it simply gives you more chances to capture sales. The platinum sales pitch will remain the same, but for shoppers on an immovable budget something as simple as the thickness of the band, and so the steepness of the price, can be the difference between walking out with a purchase or just plain walking out.
It would seem that the desire for platinum jewellery is still strong, and if retailers can capture that enthusiasm for the finest of precious metals and marry it with an offer to fit customers’ pockets then it is a win-win situation for all.