Since lockdown began in late March, there have been a number of changes to the market, with a drop in non-essential purchases and bricks-and-mortar retail taking a hit. There have been some silver linings, however, like the massive uptick in online sales thanks to social distancing measures – a trend that has continued long after lockdown was eased mid-June.
Now, as the year’s end approaches and the threat of a second lockdown looms, one of the many questions retailers and suppliers are asking is: what should we expect from the Christmas trading period?
Fourth quarter forecasts seem “mixed”, as River Mounts account executive, Nathan Warburton, puts it, while Fope’s managing director, Diego Nardin, says simply: “It is impossible to anticipate how the next few months will end up performing.”
However, cautious optimism seems to be the general feeling, as the industry hopes that buyers will be willing to part with the money they could not spend on a summer holiday, instead spending it on a gift for a loved one or even themselves.
Sif Jakobs’ Mark Riddle, director UK & Ireland, says that while retailers are “naturally being cautious”, he feels confident that “Christmas is a game-changer, and after months of self-restraint people will want to spend”.
He continues: “Buying jewellery is not easy online unless you knows exactly what you want. Window shopping can be anticipated in October with high levels of spending in November and December. Retailers should place orders now to ensure they have the stock.”
Conversely, Picchiotti’s Maria Carola Picchiotti believes that “consumers will be very cautious”, leading to a measured approach from retailers too.
John Watson, PJ Watson managing director, holds a similar opinion, but believes retailers must fight to stay afloat and maintain consumer interest.
He says: “Feedback has been positive since our retail partners have reopened. That being said, a lot will buy cautiously as there is still uncertainty as to what Christmas will bring.
“It is important for shops to still be proactive and launch new lines to keep their window fresh and customer engaged.”
River Mounts’ Nathan Warburton concurs: “We expect to see a successful Christmas trading period for the most proactive retailers, with a record shift in business being done online or through other digital channels.”
This he puts down mostly to a “pent-up demand” caused by lockdown and the lack of opportunity for luxury buying.
Others, meanwhile, report that retailers’ sales are already at record levels after lockdown eased, and they have no reason to expect this momentum to slow with Christmas on the horizon.
CME director, Howard Pessall, comments: “People still want to celebrate – not just Christmas but also anniversaries and birthdays, and even more so when people are separated physically.
“Retail shops are reporting very good sales and many report that since lockdown ceased, ‘it’s been like Christmas’. This leads them to feel hopeful.”
The silver jewellery wholesaler also reports that, like its retailers, its own trading levels look similar to those of last year.
High-end retailers in particular are reporting fewer but bigger spends since lockdown, a trend which jewellers will be hoping to tap into.
“A lot of retailers are noticing higher price point items like diamonds have increased in sales. With UNOde50, consumers are purchasing not just one item but whole sets,” claims the brand’s UK and Ireland sales director, Emma-Louise Gregory.
She continues: “I believe this is down to people feeling they deserve to treat themselves after being stuck indoors for so long, meaning that average spend is higher when they do hit the shops.”
WOLF MD, Simon Wolf, concurs: “Stores at the higher end of the spectrum are far more optimistic. Consumers were stuck at home, many on full salary. That type of customer is ready to buy or never really stopped, and their appetite has been the same or larger as they haven’t been spending money on dining out and holidays.”
The idea of higher a average spend and greater conversion rates is echoed by Hot Diamonds Group’s head of commerce, Adryan Cresswell. He believes the e-commerce boom will mean physical stores continue to suffer through the build-up to Christmas.
However, he adds: “I would expect a lower footfall but of higher quality. Those who travel to shopping centres and high streets will be serious shoppers and in-store conversion rates will be higher than in previous years.
“I imagine high street jewellers will be absolutely focused on what sets them apart from online retailers. The high street clearly has selling points that online shopping does not, and I expect jewellers to focus on pushing these as much as they can.”
While the growth in average spend is a positive trend, the decline in footfall is still a concern. Fei Liu, founder of Fei Liu Jewellery, theorises that the shoppers who have not returned to jewellery stores are the impulse buyers.
“We have seen a big decline in impulsive purchases,” he laments, “and a return to more considered purchasing patterns.” Jewellery retailers and the suppliers behind them, he says, will have to work hard to draw the buyer back in.
The designer believes that amid the challenges faced by the industry, however, are opportunities. “Innovation and design in new jewellery collections will be key for the jewellery industry,” he advises. “The consumer is searching for more personal retail experiences. They already value their personal trainer, hairdresser or tailor.
“Now they need to embrace the old, forgotten concept of the personal jeweller. The independent retailer will become much more competitive if they provide this service to their customers.
“Retailing will become a personal journey of discovery when purchasing jewellery: the experience will bring more value to the customer than a rapid, impersonal cold buy and sell, and create long term customer loyalty.”
The trend towards higher spends could also influence the types of jewellery consumers can expect to see in shops too. Many feel that the higher spends mean big statement pieces will do strong business.
UNOde50’s Emma Louise-Gregory believes that after the decline in travel and dining out, more money will equate to the bigger purchases retailers are already reporting. The brand is launching four collections for Christmas, including “more Swarovski-style pieces”, she says.
CME is also going all in on ‘celebration’ pieces, “but perhaps scaled back somewhat”, says director Howard Pessall, “less overt sparkle. Subtle pieces with natural stones, diamond cutting, statement necklaces and earrings.”
Meanwhile, Sif Jakobs’ Mark Riddle says: “In what has been a dark period for everyone since March, rainbow colours will continue to shine in jewellery. Expect layered necklaces, stackable bracelets, long statement earrings, ear cuffs and organic metal shapes.”
Italian brand Fope is focusing on what it does best and not trying to reinvent the wheel.
Managing director Diego Nardin says: “Our jewellery styles are elegant with design trends that will never go out of style. The Flex’it collections are still our most beloved lines and our variety of styles offer something iconic for all tastes.”
PJ Watson concurs, with John Watson, confirming: “We believe in challenging times like these, retailers’ and manufacturers’ focus goes back to their core offering. We will be launching new lines of classic diamond-set jewellery that hit core retail price points.”
On the precious metals side, River Mounts’ Nathan Warburton reveals that despite record gold prices, yellow gold demand “remains strong”. Platinum, however, is outperforming white gold due to its relative affordability.
Judith Lockwood, Mesmeric Distribution director, says bold colours and yellow gold are in vogue. “We are finding that consumers are actually quite brave and bold buying into colour,” she says. “18ct yellow-gold plated pieces are strong, but 18ct rose-gold plated jewellery continues to move along too.
“We have a strong vintage look and this is being bought into by our retailers. They feel confident that clients will buy – whether this is the ‘Zoom state of mind’ continuing as some people work at home and want to look well-dressed, or for those back at work who want that piece to complete their look as they are glad to be out of their pyjamas!”
Also talking about the ‘Zoom look’, Hatton and Spencer managing director, Cathie Osborne, says: “With so many people still using online conferencing, I expect we’ll see the current trend in popularity for earrings and necklaces continue.
“In a time when we’re all searching for a little extra positivity, it’s also no surprise to see spiritually inspired charms and talismans making a comeback on runways too.”
Maximising Christmas sales
With retailers asking how to boost customer interest, jewellery packaging and storage specialist Hatton and Spencer revealed it will be taking a number of steps to aid its partner retailers over the Christmas period and beyond.
These include a new loyalty programme for retailers; a Christmas gifting service; and its new Keepsafe line of travel cases, designed with high street jewellers in mind.
Cathie Osborne also advises: “To keep staff and shoppers safe and reassured this Christmas, it’s vital that our high street retailers keep up social distancing measures and continue to enforce mask-wearing in their stores.”
Sif Jakobs, meanwhile, is helping its stockists “create head-turning displays, incorporating on-trend designs, striking colour combinations and value for money retail price points”, says Mark Riddle, which the brand will also back up with social media promotion.
Mesmeric Distribution provides a similar support package for Ti Sento retailers. “We are planning, advising, looking at delivery dates,” says Judith Lockwood, “ensuring they have everything they need in terms of support, packaging, display, looking at stock-lists and sales – whatever we can do to help our retailers, we will do.”
She also warns: “There will be no late night shopping, no Christmas lights being turned on with ceremony, all of the events that normally drive shoppers out, so the stores have to look as attractive as possible to draw the spend from shoppers into bricks-and-mortar, rather than letting the buying go online.
“Customer service is key; customer safety and security is vital; warm welcomes and words through masks essential; and going the extra mile.”
Maria Carola Picchiotti also added her voice to the crowd shouting about the importance of a tempting window display. “It is vital for retailers to show new lines, keeping their windows attractive,” she implores.
Hot Diamonds’ Adryan Cresswell believes that, while rejuvenating bricks-and-mortar retail is necessary, the e-commerce boom is not something retailers should allow to pass them by, and that they should in fact lean into the current preference for online.
Fei Liu agrees that “the internet is more important than ever”, especially for younger buyers, but says a more personalised e-commerce experience is key.
He explains: “They are looking for websites with a point of difference. What we upload on jewellery websites will become much more important – not simply listing products but telling the story of the jewellery, providing additional details, stories and videos about the design and designers.”
As the strangest of years approaches the final stretch, UNOde50’s Emma-Louise Gregory confirms the brand will go above and beyond for retailers, with strong collection launches, marketing images and gifts with purchase.
She also stressed the importance of staff incentives. Ultimately, Gregory summed up the feeling at UNOde50 and other suppliers, concluding: “I think what’s most important is to have great communication with our retailers to ensure we all have a strong end to 2020.”