Some Words for Our Sponsors

There’s a lot of talk about how the industry should spend more on marketing. Yet the biggest critics of the way jewelers pour money into advertising are—ironically enough—professional marketers.

Elizabeth Chatelain of Beverly Hills, Calif.-based MVI Marketing believes jewelers should invest more in sales training than in marketing, since the best advertising is “word of mouth.” James Porte of Weston, Fla.-based Jewelry Marketing Institute says many retailers waste money on ads with no way of knowing if they actually pull people in. “Many jewelers advertise out of habit,” says Porte. “They have been running the same ad for 10 years now. And then they wonder why it doesn’t work.”

In fact, many experts think the most effective methods of advertising are nontraditional (see sidebar). They advise jewelers to constantly evaluate the effectiveness of their advertising, hunt for new markets and vehicles, and make sure the message they’re sending is clear and consistent.

Here are some of the most commonly mentioned tips:

Before you advertise, research the demographics of your market. “You need to know who you are selling to,” says A.J. Sales, head of KWHS, a Paducah, Ky.-based retail service company that also owns a local retailer. “What is your consumer base? What is their buying potential? What are their needs?” Answering these questions may require hiring a professional, although many local government Web sites make this information available for free.

The key is to find markets you might be overlooking. After noticing the expanding homosexual community in his area, Mike Schowalter of The Miner’s Den in Royal Oak, Mich., placed ads in local gay-oriented publications. “It’s a group with high disposable income because [most] are without kids,” he says. “There’s a lot of loyalty, because there is perceived discrimination in other stores when two guys come in looking for a wedding band. It’s worked really well for us.”

Don’t advertise on price alone. “People are immune to advertising based on price, unless it’s something you can make a strong case for,” Chatelain says. “The biggest factors in choosing a retailer are value for money coupled with trust, service, authenticity, and knowledge.” Price-based advertising can create a negative impression, she adds, because it tells consumers that you discount.

Be consistent. Develop a simple message about your store, and hammer it home. “Consistency is everything,” notes Porte. “The one-shot deals like those big Super Bowl ads don’t work. People are bombarded with the messages. You need to stand out.”

Consistency should apply to the store’s “look” as well. “Have a set look, a set image,” Chatelain says. “Put it on your business card, your store, and have it reflected in everything you do.”

Advertise year-round. “It’s a waste of money if you are not going to stick with it,” says Mark Levinson, Levinson Jewelers, Plantation, Fla. “It’s like going into the stock market for three days.”

Sales says retailers shouldn’t slash advertising just because the economy is bad. “That doesn’t mean you have to continue at the same level,” he says. “But if you stop, you become invisible in consumer’s eyes.”

Make sure everyone knows who placed the ad. “No type should be bigger than your own logo,” Chatelain says. “Sometimes readers spend a lot of time trying to find the [name of the] company that placed the ad. It doesn’t make sense.”

Don’t worry about your competitors. If your competitor is the star of the local radio station, don’t be tempted to outgun him. Experts say it’s better to set your own strategy and stick with it, not counter the person across the street. “If you try and outdo the other guy, you are just in a reactive situation,” Porte says. “They’ll say 10% off, you do 15% off, then they do 20% off. In the end, no one wins.”

Once you settle on a medium, forge a relationship with the sales rep. An ad’s position can determine its audience. Retailers should push for the best placement possible, Sales says. “If you have no request, they will put you wherever they see fit,” he notes. “Ask not and you will get not.”

Sometimes the best way to avoid being lumped in a cluster is to make your ad a little different. “If you have, say, a tall skinny ad that doesn’t just fit into a corner or a standard place, it might help you get a special positioning,” Sales says. Using color is another way to make your ad stand out.

Be careful when you use co-op advertising. More manufacturers today offer generous co-op deals, but consultants say proceed with caution. Unless you’re a brand retailer, you should seriously consider whether the advertising is for you. “Many ads for manufacturers do more for the manufacturer than the jewelry store,” Porte says. “Even if the manufacturer is paying half the costs, your money may be better spent elsewhere.

“Some manufacturers are in tune with retailers’ needs and can produce a better ad because they’ve spent money on it,” he continues. “If the manufacturer has a good ad, and it’s effective, I’m all for it. But jewelers must look at what the ad promotes: the brand or the store. Many jewelers working with designers found that designers wouldn’t sell to them when they became more powerful.”

Chatelain agrees that any manufacturer’s message has to be consistent with the jeweler’s. “People should take a hard look at anything that makes you change your look to accommodate someone else,” she says.

If you use co-op advertising, collect the money from the manufacturer. This sounds like common sense, but Chatelain’s surveys show that retailers collect only 60% of what they are owed in co-op. “Most retailers have poor follow-through, and they don’t bother to ask,” she says. “They place the ad and then don’t do the paperwork.

Advertising should target not only new consumers but also existing ones. “Prospecting is a lot more expensive than marketing to people who are already your customers,” says Porte. “Every jeweler should have a database of information of every person who has purchased something, even if they just came in for a repair. They need the birthdays, the anniversaries, and the e-mail address.”

Schowalter of The Miner’s Den gives customers the option of entering their information on cards, which are put into a bowl and entered into a monthly drawing for a $100 gift certificate. He believes this is less intrusive than asking for the information outright. The store now has a database of 20,000 names. Each of these names receives regular birthday and anniversary cards, occasionally with a coupon. The reminders are mailed in a birthday-card-sized tan envelope. “You have to present a neat package so that it doesn’t say advertising,” Schowalter says. “We usually include an unobtrusive, clever message that says something like ‘Pick something up if you don’t want to be in the doghouse.’ Somewhere along the line these people will get jewelry for those occasions, and you want them to stay aware that you are a jeweler and take them seriously as a person. We probably get a 15% response, which is extremely high for a direct mailing.”

Gary Long of Long’s Village Jewelers in Stockton, Calif., recently scored by sending everyone who had spent more than $2,000 in his store a $100 no-strings-attached coupon. In theory, he was taking a risk, since the coupon could be used for a $100 item. But he feels the math cut his way. “The money I gave away was about 3% of total sales that resulted,” he says. “Even if they just bought $100, who cares, they had already spent $2,000. I had so many customers come in and say I have to use this, because otherwise it’s like throwing $100 in the garbage.”

Sales notes that coupons are generally more effective with existing customers than with new ones. “When you see a discount in the newspaper, customers feel ‘Why would they give this to me?’ ” he says. “But if you send it to people who already bought from you, and it says they are a preferred customer, it means a little more.”

Use e-mail as well as direct mail to communicate frequently. “If you don’t communicate with your customers, people forget about you,” Porte says. If you use e-mail, ask permission first, and give people a way to opt out.

Once you’ve chosen an approach, track its effectiveness. Porte recommends asking each customer where he first heard about the store. He even suggests conducting focus groups of local residents to determine what media they read, what they’re looking for in a store, and how they choose where they shop. Information from customers is not always reliable, so retailers should consider conducting some carefully controlled experiments. “Let’s say you announce a new jewelry line,” Chatelain says. “If you do that in one or two placements, you can tell where you are getting the pull from.”