Powerful franchise jewelry chains have come to drive more profits to their enterprises, and drive out the traditional classic stores that came before them. Disruptive technology, too is playing its part in driving out custom handmade jewelry. Gone are the days of going out to the local jeweler to pick out that special piece of jewelry. While once prominent as a way to show your love or commemorate a special occasion, technology has overtaken the once thriving brick and mortar jewelry stores. Online shopping and the demand for high tech gadgets has replaced the need of new and existing jewelry stores. While not yet completely gone, jewelry stores could soon become a thing of the past. Consider that this past week a CAD company and 3D printing company joined forces to hold workshops on creating custom jewelry with the technology.
Classic jewelry stores still exist in larger cities such as New York, Chicago, and the like; however, they are few and far between. The industry still strives in the affluent parts of Europe and the Middle East where you can still go to a local jeweler who will craft a hand-made piece of jewelry specifically for you. Despite the few areas that still boast of high-end jewelers, technology has changed the way we will forever purchase our jewelry. However, some outlet retailers and franchises are moving in with brands like Pandora, who doubled their sales this year, according to MarketWatch earlier this month. Kay Jewelers and Jared Gallery of Jewelry are two other major players in the franchise game. Kay and other retailers including Zale helped propel the profits and earnings of Signet Jewelers to an increase of 45 percent and $22.2 million year over. The company recently acquired the popular Zales brand that helped contribute to the gains. Interestingly, it was also reported by Rapaport that jewelry store sales overall are in a slump in the US, meanwhile Tiffany & Co. is cashing in on the top one percent income earners for their market share in the US, as well as solid gains in Europe.
Chain stores killed the local jeweler
The classic jewelry store is a thing of beauty. Many people have not experienced this in person which is a shame. Visiting a jewelry store to purchase a one-of-a-kind piece or have something hand-made especially for you is an experience you will remember for a lifetime.
A friend of mine once recalled a visit to a jeweler in Kuwait back in the mid-1990s. He stated that when he walked in he was treated like a king and after being unable to find a ring that he liked, the jeweler asked him to describe the perfect one. After a brief sketch was created, he waiting in the lobby of the store (similar to a 5-star hotel) for approximately 1 hour while the jeweler mounted, personalized, and sized the ring. The end result was a beautiful one-of-a-kind piece and came with a story that you don’t get if you purchase jewelry online or in a chain store.
Personal connection to the jeweler is being lost and franchise and corporate owned stores have taken over the industry. While you lose the personal experience as described above, you do receive a piece that is less expensive. The problem is that now that chain stores have choked out the local jewelry stores, the quality you find may not be the same. Prices have also gone up to meet or exceed that of a local jewelry store. It is a trade-off that society has come to accept. Chain stores are now even offering “custom jewelry” that you can design from a kiosk in their store. This may not be the same as a local jeweler, but still gives the perception of customization.
Years ago, along came a simple shopping website for people to sell vintage and hand-made crafts. While it was laughed at by competitors such as eBay who foresaw the website going out of business quickly, Etsy has now made a name for itself in the jewelry marketplace. Etsy is just one of many online platforms that have helped put an end to some of the brick and mortar jewelry business. In fact, online purchases of jewelry and watches is reported to be growing at 17% per year. However, Etsy recently lost millions this last quarter and reportedly hid a massive counterfeiting problem on the site. News also spread that someone had made at least $1 million by buying wholesale and reselling on Etsy.
Many companies who normally operate brick and mortars have turned to online shopping to grab some of the market they lost. One such company is Kay Jewelers. Owned by Sterling Jewelers (Zales, Jared, Rogers, etc.), the company has seen the industry shift and taken advantage. The company not only sells jewelry online, but has saturated the Internet with its marketing presence, including with social media websites such as Facebook and Pinterest.
The Pearl Source is another website that has embraced the online world. Founded in 1991, it was mainly a supplier of loose pearls to big jewelry stores. It adapted its sales to the online marketplace and now is one of the largest direct importers of wholesale loose pearls in the United States as well as a one-stop shop for pearl jewelry. It was able to build a trusted consumer base through its branding strategy of turning people away from its website. Instead of publishing its own reviews, it sends consumers to trusted third-party review websites with actual customer reviews. This has helped it become the largest source of loose pearls and one of the most respected pearl jewelry dealers on the Internet.
Home shopping networks
Home shopping networks have become a popular place to purchase jewelry. In fact, home shopping networks have moved from selling finished pieces into selling gemstones that can be mounted by the purchaser. This gives the allure that you are purchasing something special as opposed to a piece that everyone else has. However, it still requires the work of a local jeweler which could be hard to come by depending on where you live.
Although we can argue the benefits of online jewelers versus brick and mortar jewelers, you cannot argue that jewelry is being replaced by other items such as high-tech gadgets. No longer are birthdays and anniversaries filled with boxes containing jewelry, they are filled with boxes from the Apple Store such as the Apple Watch or the new iPhone.
A recent article in Pacific Standard Magazine discussed dwindling jewelry sales thanks to technology. “If jewelry used to be the ultimate lover’s gift on birthdays and anniversaries, iPhones are the new way to say I love you,” states author Beejoli Shah. “The last few birthdays and Christmases have yielded vacation getaways, iPhones of every generation, even a smart home thermostat. What hasn’t shown up under the Christmas tree in the last five years? Diamond anything.”
The new jewelry is “smart jewelry” according to Computerworld. Consumers of all ages are turning to the Apple Watch as well as blinging out their iPhone and iPad cases. Regardless of your view on the jewelry industry, past and present, seeing the changes right in front of you should be proof that the industry is evolving into the online marketplace or dying out altogether. Death will come to the brick and mortar jewelers and all we will have left is a few large chains, Internet shopping, and high-tech gadgets to take their place.