WHERE TOP CONSUMERS SHOP FOR JEWELRY
Retail jewelers can take encouragement from a new shopping-preferences study commissioned by MasterCard and the National Retail Federation. Upscale consumers say they are much more likely to shop for fine jewelry at a traditional jewelry store than at other types of stores.
The survey, conducted by Yankelovich Partners, Norwalk, Conn., asked 1,001 consumers with annual household incomes of $200,000+ where they shop for fine jewelry for themselves and as a gift for someone else.
By a wide margin, the majority of consumers surveyed prefer traditional jewelry stores when buying fine jewelry for themselves (66%) and as a gift for others (57%). Department stores were second – 16% preferred them when buying fine jewelry for themselves and 21% when buying for others. Other types of outlets – including TVshopping networks – followed far behind (see chart).
The survey also asked where consumers prefer to buy costume jewelry. In this case, department stores came out on top. Twenty-eight percent go to department stores to buy costume jewelry for themselves and 36% do so to buy it for others.
The study also found consumers are shopping less often. The number who said they shop less often than a year earlier rose from 31% in 1993 to 36% in 1994.
How can you draw them back to your store more often? Stress value – as determined by price, quality and ease of purchase – according to the study. Too often retailers overemphasize price while downplaying the other components of value, the study found.
GOLD SUPPLIES, PRICES STABILIZE IN 1994
Most of the world’s governments chose to keep their gold in their treasuries rather than sell it in 1994, according to Gold Fields Mineral Services, a consulting company that issues a supply and demand report each year. Official gold sales fell dramatically from 519 metric tons in 1993 to 46 metric tons in 1994.
But the market remained stable because a substantial decline in investor interest offset the reduced supplies. Investors who had stocked up on gold when its price rose 20% in 1993 unloaded it in 1994 when it failed to push above $400 per ounce.
All other major factors in the supply and demand sides of the gold market were nearly unchanged last year. For example:
The jewelry industry used 2,469 metric tons, down only 32 from 1993.
The use of gold for official coins totaled 72 metric tons, down 47. It was virtually unchanged for electronics and other industries.
New mine production rose just 24 metric tons to 2,304.
Scrap gold coming onto the market rose 4 metric tons to 531.
The report speculates that rising interest rates in the U.S. and minimal inflation worldwide will continue to discourage investors from going into gold this year.
OF MEN AND MONEY
One of the major trends in the past 20 years has been the rise of the male shopper, says Gentlemen’s Quarterly magazine. The rising number of dual-income households has provided not only more money to shop, but also more need to split the duties of shopping.
And men’s shopping trips aren’t limited to necessities such as groceries and gifts for someone else. While marketers have paid much attention to the women’s self-purchase market, GQ has found a growing men’s self-purchase market. The “1995 GQ Jewelry and Watch Study” offers some interesting information about this market.
Among 1,000 GQ readers surveyed in September, for example, 41.2% of the respondents said they would buy a watch for themselves in the next 12 months. Nearly a third (31.9%) indicated they would spend more than $1,000 (17.6% plan to spend $500-$999, 49.6% plan to spend less than $500). And while jewelry industry surveys historically show that men own two or three watches, the GQ readers own an average of five watches.
The survey also found that many of the respondents are interested in giving watches as gifts. In fact, 85.5% said they had already done so (59.5% to a wife/partner, 28.7% to a girlfriend/significant other and 27.1% to a parent). However, they paid less for watches given as gifts than for those for themselves.
GQ readers also seem to know that jewelry makes a great gift. Nearly all respondents (95.2%) said they have bought jewelry for someone else (74.1% for a wife/partner, 52% for a girlfriend/significant other and 40.7% for a parent). Nearly half the respondents (45.7%) spent more than $500 on a jewelry gift, and 23.7% spent more than $1,000.
Contrary to stereotypes of males being helpless at gift selection, 79.2% of these men bought watch gifts on their own, while only 20.8% consulted with the person receiving the gift. For jewelry, an equally impressive 78.9% bought the gift on their own, with 21.1% consulting with the recipient.
The best news? More than two-thirds of the respondents (67.1%) plan to buy jewelry as a gift in the next 12 months. Of those men, 24.3% plan to spend more than $1,000.
Here some other findings from the study:
In descending order, respondents were most likely to give a jewelry or watch gift for a birthday, Christmas, anniversary, Valentine’s Day, wedding, other.
Asked where they shop for jewelry and watches, 80.3% said independent jewelry stores and 54% said department stores (exceeds 100% due to multiple answers).
Asked where they seek information on buying jewelry and watches, 63.0% read magazine ads, 50.9% look at store displays, 44.6% ask friends and family, 43.9% read articles in magazines, 39.8% rely on salespeople and 37.4% look at catalogs.
These men are an educated, affluent, professional group in the prime of their earning years. By age, 2.0% are 18-24, 31.8% are 25-34, 39.8% are 35-44, 23.9% are 45-54 and 2.1% are over 55. By marital status, 51.9% are married, 32.2% have never been married and 15.6% are widowed, divorced or separated. Just over 92% are employed in professional, technical, managerial, executive or sales positions. Household incomes exceed $75,000 for 68% of the respondents, range between $50,000 and $75,000 for 22.7% and are below $50,000 for the rest.
NEW JEWELRY BUSINESSES DECLINE IN ’94
The U.S. jewelry industry eyed expansion with caution in 1994, opening 77 fewer new businesses than in the previous year. Still, the total number of jewelry businesses – old and new – increased by 74 to 36,846. (While the number of new businesses fell, the overall census increased because of fewer closings in 1994 than the previous year.)
The figures are from a year-end census report on the retail, wholesale and manufacturing segments of the industry by the Jewelers Board of Trade, East Providence, R.I., which offers credit rating and other financial services.
Retailers accounted for 77% of the new businesses, manufacturers for 13% and wholesalers for 10% – virtually unchanged from 1993. In actual numbers, retailers totaled 27,753, manufacturers 4,769 and wholesalers 4,324.
Every region reported fewer new businesses except the Southwest. The region had a slight gain (up eight) as the economy started to emerge from a stubborn recession caused by weakness in the defense and high-tech industries. The North Central region, suffering from severe floods, reported the biggest decrease (down 35).
There was good news regarding financial embarrassments, which include bankruptcy filings, receiverships, assignments, arrangements, partial settlements, moratoriums and bulk sales where creditors were not paid in full. The total fell by six to 215 last year, thanks to big decreases in the North Central and South Central regions (down 11 and down nine, respectively). They rose by seven in the Northeast and marginally elsewhere.
JBT increased the ratings of 2,256 companies during the year (up 115 from 1993) and decreased those of 3,431 (up 290).
The number of claims fell by 101 to 4,955, and the average amount of those claims totaled $3,200, up $558.
WHERE TOP SHOPPERS PREFER TO BUY JEWELRY
|Fine Jewelry||Costume Jewelry|
|Chain dept. stores||6%||13%||11%||14%|
|TV shopping networks||2%||3%||1%||1%|
Source: MasterCard/Yankelovich Value Study
NEW JEWELRY BUSINESS
Source: Jewelers Board of Trade