Evolving Product Mix from Toasters to Tanzanite

In the early decades of the century, jewelry stores, especially those in small towns and rural areas, operated like mini-emporiums. They sold not only jewelry, watches, and tableware but also eyeglasses, ladies’ hair combs, even luggage and appliances. A 1905 copy of the Jewelers’ Circular, the precursor to this magazine, includes ads for coffee machines and eyeglass displays.

With shifts in consumer buying habits and growing competition from mass merchandisers and specialty retailers, jewelers would later shed these ancillary product lines and focus on fine jewelry and watches and, to a lesser extent, tableware. The evolution of jewelers’ inventories over the past 100 years reflects changes in professional training, merchandising trends, and fashion, as well as economic and political influences.

Fine jewelry comes to the hinterlands. Until the 1960s, fine jewelry was found primarily in large metropolitan areas. Most small-town jewelers supplemented sales of lower-end jewelry by carrying watches and clocks and gift- and tableware. Eyeglasses disappeared from jewelers’ inventories early in the century as the optical industry grew, but appliances remained in many small-town jewelry stores into the ’50s and ’60s. Early on, few jewelers outside of big cities carried solid 18k or 14k jewelry, designer brands, or even 14k-plated items. They were more likely to offer 14k-filled or gold-overlay jewelry, and their diamonds generally were smaller than a half-carat. Rarely did they sell colored gems—and then, only rubies, sapphires, and emeralds.

All that changed with the spread of professional training at mid-century by groups like the Gemological Institute of America, the American Gem Society, and the Diamond Council of America. By this point, even small-town jewelers had begun selling fine jewelry and gems to an increasingly affluent public.

The results were dramatic. Diamond jewelry became vital to business success. Retail sales of colored gemstones and pearls grew as well, as those markets boomed in the ’80s and gemological training put greater emphasis on these products. By the mid-’90s, jewelers had expanded their stock to include more exotic gems such as tanzanite. Treated gems had become increasingly prevalent, sparking debate among jewelers over disclosure.

Watches and tableware. Other categories have become less important. Watches were major products for jewelers for most of the century. Men’s pocketwatches and ladies’ pendant watches were big sellers in the early decades. Wristwatches, which became popular during World War I, replaced them from the 1920s onward. Watch repair remained vital to jewelers’ business well after World War II—in part because so many veterans went into watch repair and then into jewelry—despite growing competition from department stores.

That began changing in 1969, when Japanese watch manufacturers unveiled electronic quartz modules. They replaced traditional mechanical movements and could be made cheaply and in volume. By the 1980s, quartz watches could be bought almost anywhere, and price-cutting and competition forced many jewelers out of the watch business. In the late ’80s and ’90s, a revived Swiss watch industry and renewed consumer interest in mechanical watches prompted many jewelers to restock watches.

Tabletop ware took a bigger plunge. For much of the century, jewelers were the retailers of choice for fine tableware and flatware. Seeking higher volume, tabletops suppliers would later focus on department stores, outlet stores, and other mass merchants. Volatile silver prices and the rising costs of retail space in the ’80s made flatware and china unprofitable for many jewelers, who needed the space to display diamond jewelry.

The impact of fashion. Throughout the century, fashion has influenced what jewelers sell. Low-cut gowns in the early years spurred sales of pendants and pearl necklaces, while ornate hair combs decorated women’s luxuriant Edwardian hairstyles. When swept-up hairstyles exposed the ears after World War I, earrings became popular and combs disappeared. Platinum grew popular in the 1920s as the preferred setting for diamonds.

The art deco style—characterized by bold colors, geometric designs, and greater use of gems—dominated the inventory of big-city jewelers in the 1920s and ’30s. It was followed in 1940s by retro modern, sculptural and glamorous, with motifs like bows and unusual combinations of gold and gems. The ’50s saw the beginning of designer jewelry—which by the late ’80s would be a major trend in sales—and the growing influence of the Baby Boomers. Many jewelers, catering to a young market, added school and college rings. Pierced earrings came back in style, as did cufflinks briefly.

The ’60s and ’70s saw more beads, bangles, nugget jewelry, and chunky watches in jewelry stores. Jewelry design was now freer, as creative young designers who began with beads and cold-silver soldering moved up to 14k, 18k, diamonds, and gems. Craft artists also affected what jewelers carried, sparking a renaissance in design in the 1990s.

Political and economic factors. A number of political and commercial events in this century likewise influenced what jewelers sold. The National Stamping Act of 1906 regulated the marking of gold and silver metal content. The collapse of European economies following World War I made America a prime market for diamond jewelry. De Beers further stimulated this demand starting in 1939 with its ad campaigns for diamond jewelry. During World War II, restrictions on strategic metals retarded the use of platinum in jewelry, and the impact of those restrictions would be felt for decades.

The collapse in 1981 of the previous decade’s diamond investment boom and the concurrent plunge in inflated gold and silver prices forced many jewelers to sell off as much inventory as possible. Diamond jewelry sales recovered with effective marketing ideas like the anniversary band and the tennis bracelet. Jewelers’ gold sales rebounded in the late ’80s and into the ’90s thanks to the strong purchasing power of working women. Estate jewelry and watches became a source of revenue for more jewelers. Silver jewelry made a comeback at the end of the century, owing to consumer demand for “white” metal jewelry.—William George Shuster, Senior Editor

Diamonds: A Move to the Middle Class

In 1905, startling news rocked the gem world. The largest diamond ever found was unearthed from the new Premier Mine in South Africa.

The global publicity surrounding the 3,106-ct. Cullinan diamond led many to speculate that the coming century would see a boom in big, costly diamonds. Instead, the trend went in the opposite direction: Diamonds passed from the exclusive domain of the rich and royal to the average consumer. South Africa’s new mines were producing small and medium-sized diamonds that suited the budgets of the rapidly expanding American middle class. Retailers and jewelry manufacturers recast their inventories to feed the growing demand.

A new cut. Adding to diamonds’ appeal was a new style of cut, developed in 1919. From Victorian times, the mainstay of American diamond cutters was the old mine cut, a rounded variation of the traditional old European cut. Marcel Tolkowsky, a mathematician from a well-known Antwerp diamond family, devised a formula for setting crown and pavilion angles to generate more brilliance and fire than were obtained from previous designs.

Several firms—notably Lazare Kaplan—quickly adopted the new cut. The New York polishing industry, conservative and reluctant to accept the lower yield of Tolkowsky’s measurements, was slower to adapt. Gradually, a solution would emerge that improved the yield and lowered costs: the round brilliant cut, still the most popular cut today.

Diamonds for everyone. Diamonds remained something of a mystery to Americans through the first few decades of the century, despite Harry Winston’s efforts to add glamour by draping royalty and movie stars in his stunning jewels. But all that began changing in 1939, when

De Beers reached out to the middle class with its diamond engagement ring ads. By mid-century, Americans were buying almost three-fourths of all diamonds coming out of cutting factories worldwide.

Diamonds were further democratized in the 1960s, when the workers in India began cutting smaller stones. Several Indian companies garnered sights from

De Beers’ Central Selling Organisation by polishing small, low-quality rough—previously sold off cheaply as industrials—into gleaming little gems. The Indians like to say they did for diamonds what Henry Ford did for automobiles, making them affordable to the masses.

By the 1970s, large retailers like Zale, J.C. Penney, and Sears were offering diamond earrings and rings at prices competitive with better costume jewelry. The result was a two-tier market: smaller, cheaper diamonds and larger, expensive ones, each segment with its own distribution channels and demand cycles. This was particularly evident during the recession of the early 1980s, when demand for high-ticket diamonds fell drastically, as did prices. The popularity of Indian-made lower-quality diamonds soared.

On the high-end side, the 1970s brought a new category of stone: investment-grade diamonds. As high inflation undermined confidence in paper investments, people took refuge in hard assets, particularly gold and diamonds. Prices skyrocketed. Fueling the boom was the growing use of objective grading reports from the Gemological Institute of America and other labs.

The investment mania didn’t last long. As inflation eased in the early 1980s, investors lost interest in diamonds and prices fell as fast as they had risen. Diamond companies went out of business and many people, jewelers included, lost large amounts of captial.

Enter lasers. The introduction of the laser, meanwhile, transformed the diamond-cutting process. In the 1970s, diamond manufacturers discovered that laser beams could “burn out” black inclusions, creating a market for diamonds that previously had little or no demand. By the end of the decade, lasers were also being used to inscribe diamonds with personal messages or identification numbers.

Lasers eventually would be used to cut diamond rough in almost any direction and with any pattern. New diamond cuts were suddenly possible, and traditional cuts, such as hearts, could be created easily. Fiber-optic technology allowed manufacturers to automate the bruting process, creating perfectly round diamond forms to which the automated polishing machines could apply perfectly cornered facets. Round brilliants had never looked so beautiful.

As the new millennium approaches, diamond manufacturers, retailers, and even De Beers are experimenting with ways of inscribing their “brand” on diamonds to create added value and increase consumer confidence. While De Beers’ project remains controversial, the coming years surely will see greater attempts to “individualize” diamonds through unique cutting styles or trademarking.—Russell Shor, Contributing Editor

The Engagement Ring: Same Sentiment, Different Styles

The engagement ring has a rather brutal origin dating back to the cave dwellers. The preferred method of wooing a lady at the time was to chase her down, bind her ankles and wrists with braided grass, and carry her home. When she could be trusted not to run off, a grass finger ring was used to commemorate the wrist and ankle restraints that proved so instrumental to their initial conjugation. Whether or not relations between the sexes have evolved much since then is open to debate. But certainly the rings used to symbolize the union of man and woman have come a long way from those crude grass prototypes.

The latter half of the 19th century saw an expansion of the middle class, whose growing affluence now meant that the custom of giving engagement rings was no longer a prerogative of the wealthy. By the turn of the century the custom had become almost universal, and jewelers responded with ring designs to suit a diverse range of tastes and budgets. Natural pearls rivaled diamonds as the stone of choice for engagement rings. But the increasing scarcity of the pearls priced them beyond the budgets of most people, and diamonds soon gained the predominance that continues to this day.

Design trends. Designers in the early decades of this century favored elaborate filigree and engraved mountings with floral and other romantic motifs that often overshadowed the stone itself. Also popular were three-stone rings—for example, a sapphire or ruby flanked by a pair of diamonds. It wasn’t uncommon among the affluent to have a family heirloom remounted for use in an engagement ring.

Introduced in the late 19th century, the classic open-mount, six-prong Tiffany setting with a round solitaire soon dominated the market. That predominance continues to this day. The American Ideal cut introduced by Tolkowsky in 1919 supplanted the old European and old mine cuts favored by designers of the previous century. Except for the war years, platinum in the early decades of the century rivaled white gold as the preferred metal for engagement ring mountings.

By the 1930s the delicacy that characterized the earlier Edwardian designs gave way to bulkier mountings. “They lost that gracefulness of the beautiful mountings of the early century,” says Joyce Jonas, president of the American Society of Jewelry Historians. The flexible, lightweight settings developed by Harry Winston in the 1940s as well as improved diamond-cutting techniques paved the way for the marquise, pear, and emerald cuts that by the 1950s became increasingly popular for use in engagement rings.

The last two decades have seen a growing interest in designer engagement rings as artists such as Whitney Boin, Richard Kimball, and Jean-Francois Albert have sought to satisfy a taste for the unique. Elaborate Edwardian and art deco styles have made a comeback, reflecting a nostalgia fueled in part by period films such as Titanic. The resurgent popularity of platinum jewelry likewise extends to engagement ring settings. All the while, the round solitaire mounted in a four- or six-prong Tiffany setting has retained its longstanding popularity. Amid the vicissitudes of taste over time, that much has remained a constant.

Also timeless, of course, is the impetus for the gift. The Roman poet Ovid spoke of “a ring having no worth except the love of the giver.” Now there’s a sentiment over which even the most ill-mannered cave dweller might have found himself misty-eyed.—Rob Murphy, Senior Copy Editor

Gemstones: A Century of Glories Unearthed

The 20th century surpasses all others for the sheer volume of new and exciting gem finds. The earliest came in 1902 in the tourmaline-rich Pala region of Southern California, where a pink spodumene was discovered and dubbed kunzite in honor of famed gem expert George F. Kunz. Large kunzite deposits found later in Afghanistan have helped make this unusual and beautiful gem a favorite in jewelry stores. Also discovered in the Pala region early in the century was a pink beryl named morganite for one of Tiffany’s most important customers of the time, J.P. Morgan.

Most of the century’s key gem finds have occurred in Africa. Among the more important ones were tanzanites from Tanzania and tsavorites from Kenya. Africa has served as the principal source for new and important deposits of old familiar stones. Colored sapphire, intensely saturated aquamarine, vanadium-colored emerald, Burma-like ruby, outstanding color-change garnet, and wonderfully clean tourmaline have been found in Namibia, Nigeria, Tanzania, Zambia, Zimbabwe, and the island of Madagascar.

More recent discoveries have occurred farther east in Afghanistan and Pakistan, which now produce spectacular rubies, emeralds, kunzite, lapis, and tourmaline. Further north, gemologists have been delighted by the rediscovery of demantoids in Russia, sparking a revival of that nearly forgotten dispersive green garnet.

Brazil, a country rich in colored gems for 400 years, confirmed its claim as the colored stone capital of the world. In the 1980s Brazil yielded two new important gem finds. First came Russian-quality Itabira alexandrite, showing a Uralian color change from vivid red to green. Equally impressive were the electric neon blues and greens of the Paraíba tourmalines.

Diamond discoveries. Key gem discoveries of the 20th century extend to diamonds as well. Among the most important occurred when geologists determined that diamonds must have been swept into the Atlantic Ocean via the Orange River in southern Africa. Exploration proved them right. Thus began Namibian coastal and off-shore diamond mining, turning up the best-of-the-best in quality. Equally important were discoveries in the early 1950s of diamond-bearing pipes in Siberia, which continue to produce some of the finest colorless octahedron in the world.

Perhaps the most stunning diamond development of all was the discovery at Argyle in Australia. Most experts had long dismissed Australian diamond hopes as pipe dreams. By late 1985 the Argyle find was producing 40 million carats a year, including the most spectacular pink and red diamonds ever uncovered.

As the century draws to a close, Canada has emerged as a major diamond producer. Legendary Canadian geologist Charles Fipke searched the tundra doggedly for 10 years until he found the deposit at Ekati. Opened just last October in the Northwest Territories of Canada, Ekati is the first North American gem-quality diamond mine to launch full commercial production. Dismissed in some circles as an eccentric, Fipke, who holds a 29% stake in the estimated $500 million annual production, is having the last laugh.—Gary Roskin, G.G, FGA, Senior Editor

Cultured Pearls: Mikimoto’s Legacy of Beauty

The pearl trade in 1900 had changed little over the previous two millennia. Since the earliest recorded history, the Persian Gulf had been the primary source of the world’s finest-quality natural pearls, long a staple of ostentation among the privileged. As the 19th century drew to a close and supplies of natural pearls dwindled, an obscure former noodle peddler in Japan was conducting experiments that soon would change everything.

Kokichi Mikimoto’s idea of taking mantle tissue from one oyster and implanting it in another to stimulate secretion of nacre was not a new one. The Chinese had tried it as far back as the 14th century. Nor was Mikimoto the first to patent the idea (in 1896); his compatriots Tokichi Nishikawa and Tatsuhei Mise would claim that distinction. Mikimoto’s legacy owes more to the tireless zeal with which he promoted cultured pearls to a skeptical and sometimes downright hostile trade during the early 1900s.

“Everybody was reluctant to carry something like that because in their minds it was not natural, it was artificial, man-made,” says New York pearl dealer Albert Asher. “But because of his good marketing spirit he was able to make people accept cultured pearls, and the rest is history.” By the 1920s fine-quality cultured akoya pearls had become available in commercial quantities and thereafter would dominate the market. Ironically, the Japanese akoya industry now faces its gravest crisis ever: a virus, pollution, or some other unknown agent is devastating the oyster crop. Pearl production is down 80% to 90%.

Pearls from outside Japan. In the 1950s in Burma, Japanese pearl farmers were working with large (10- to 12-in.) Pinctada maxima oysters to produce satiny pearls of various colors. Production expanded until 1968, when a military junta seized power and ousted the Japanese. Output diminished sharply thereafter.

Attention meanwhile had turned to Australia and Tahiti, where culturing experiments started in the late 1950s. Early production in Australia yielded pearls that generally were small, baroque, grayish, and far less satiny than their Burmese counterparts. Over time the quality of Australian pearls improved dramatically. Paving the way for that improvement was the development of the second-seeding process by Australian pearl innovator Nicholas Paspaley.

In the 1970s, a French former pilot and airline executive named Jean-Claude Brouillet bought an island off the shores of Tahiti and started cultivation of black and colored pearls. Resistance to black pearls in the U.S. jewelry trade remained strong, however.

New York pearl dealer Salvadore Assael helped persuade the Gemological Institute of America to issue certificates denoting the black and other colors of Tahitian pearls as “natural” rather than treated. That imprimatur proved critical. Assael in turn devised a shrewd marketing strategy. “The way to do it was not to go through the small retailer but to go through all the biggest names in the jewelry business, Harry Winston, Van Cleef & Arpels, Tiffany,” says Assael. “I thought if I could get them to buy [Tahitian pearls] or use them in their jewelry, then everybody would copy them.” That proved to be a prescient guess.

In recent years, there’s been a tremendous influx of Chinese freshwater pearls, the quality of which continue to improve. The small (2- to 3-mm), rough-skinned, rice-shaped product of the early ’90s has given way to larger (8- to 9-mm), smoother, and rounder pearls, with colors ranging from cream to almost orange. Prices plummeted as Chinese freshwaters saturated the market.

Pearls of all types and colors have grown increasingly popular. In 1997 retail sales of pearl jewelry in this country topped $1 billion for the first time. No one imagines it will take another century to reach the $2 billion mark.—Rob Murphy, Senior Copy Editor

Wristwatches: Surpassing Yesterday’s Dreams

No jewelry product category has undergone more changes over the last 100 years than watches. In 1900, almost all timepieces were pocketwatches. Wristwatches were merely a fad and considered effeminate.

That all changed in 1904, when a Brazilian aviator named Alberto Santos-Dumont requested a hands-free watch for his flying missions. Cartier obliged with the “Santos,” a sporty “leather bracelet” wristwatch believed to be the first worn by a man. Major W.W. Crosby, an officer in the National Guard, is credited with wearing the first American-made wristwatch in 1910. The New England Watch Co. subsequently advertised the wristwatch as being “suitable for soldiers and sailors.” Wristwatches gained popularity during World War I as essential instruments for fighter pilots and infantry. Civilian demand soon followed suit.

Fashion meets function. By the 1920s, wristwatches had overtaken pocketwatches in popularity. As U.S. watch manufacturers designed what looked like smaller versions of pocketwatches, Swiss producers captured market share with fashionable wristwatches. The art deco period of the 1930s spurred a wristwatch craze as watch design became an art. The black-and-white wristwatches of wartime gave way to daring designs that showed a Far East influence. During World War II, technical functions, including chronographs, became popular.

The new focus on function led to a technological revolution. Quartz wristwatches—pioneered by Seiko in 1969 and initially ignored by the Swiss—forever changed the way watches were marketed and sold.

Manufacturing on the U.S. mainland gave way to overseas production in the 1970s. The United States evolved into a major watch market. Japanese manufacturers, first Seiko and then Citizen and Casio, seized the opportunity with moderately priced quartz watches. Quartz also ushered in a wave of inexpensive digital watches, a fad that came and went as fast as disco. The Swiss during these years concentrated on their strength, quality watches, while finally acknowledging the trend toward quartz.

The early 1980s welcomed a new watch category: fashion watches, inexpensive watches of good quality with strong brand names. This niche started with the Swatch phenomenon in 1982 and was later bolstered by Fossil, Guess, and others. Throughout the 1980s a healthy economy boosted watch sales.

The early 1990s recession prompted some jewelers to abandon watches, only to later realize their traffic-building power. By the late 1990s watch branding had triggered a resurgence in upscale, sports, and mechanical watches. The biggest event in watch retailing occurred in 1997 with the opening of the Tourneau Time Machine, the world’s largest watch store.

In 1900, watches were used simply to tell time. No one dreamed they would someday be used to call friends, change channels, pay for groceries, perform calculations. Then again, no one even thought the wrist was any place for a timepiece.—Keith Flamer, Senior Editor

Designer Jewelry: Transcending the Mainstream

In 1977, Mort Abelson, then director of the Jewelers of America show, assembled a small group of artisan jewelers into the first “New Designer Gallery,” tucked in the back of the ballroom at the New York Sheraton. It was a move that would change every subsequent major American jewelry trade show. Today, a show’s designer section is a first stop—if not the only stop—for many retailers.

Before 1977, jewelry artisans in the United States had a following among sophisticated collectors, but virtually everyone else ignored them. Consumers may have known the names of the great houses like Harry Winston or Cartier, but those jewelers were accessible only to a few privileged women. Most of the jewelry available was traditional fare, and little of it was branded with a designer’s name.

Jewelry up to that time was still something most women received as a gift. A woman’s jewelry wardrobe probably contained her engagement and wedding rings, a watch, perhaps a strand of pearls or a gold necklace, and some gold, pearl, or even diamond stud earrings. Depending on the family’s income and social standing, her jewelry collection may have grown to include a few cocktail rings, brooches, bracelets, maybe a diamond watch, and a few more necklaces or pairs of earrings.

While the design of these pieces obviously varied, most didn’t stray too far from what people expected a cocktail ring or bangle bracelet to look like. There was little experimentation with gem cuts, surface treatments, or unusual fabrication techniques. “I used to see every line that went into the [JA] show,” Abelson told JCK in a 1996 interview. “The similarity of merchandise was boring.”

Crafting a revolution. But outside the traditional sector, changes were brewing. A German gem cutter named Bernd Munsteiner had developed “fantasy-cut” colored gemstones vastly different from any traditional style. Maine metalsmith Michael Good perfected and began teaching anticlastic raising, a technique of hammering sheets of gold so that it curves back into itself. In New York, Michael Bondanza was rediscovering platinum as a design element, not just something to hold a diamond. These were just a few of the growing number of artisan jewelers making distinctive yet commercially viable creations in precious metals and gems. Mort Abelson, meanwhile, had discovered that regional craft fairs held a mother lode of talent he could lure to the JA show.

Abelson’s gallery challenged the status quo. For the first time, jewelers were being asked to promote a name other than their own and to set aside display space for presenting a designer’s collection. Pricing, too, was a challenge, since it wasn’t based mainly on the intrinsic value of the materials.

Jewelers’ reactions ranged from curious to skeptical to hostile. But designer jewelry caught on, predictably with a few visionary retailers at first. Gradually, others accepted the idea of branded jewelry based on design. As price-oriented mass merchants increasingly entered the jewelry market, independent jewelers found it harder to maintain adequate profit margins on basic merchandise. They turned to designer jewelry as a way to differentiate their stores from the new competition.—Hedda T. Schupak, Senior Editor