Where has the prestige or the luxury gone in our industry? I ask, because I’m not sure I can see it anymore.
The jewellery industry is supposed to be driven by luxury and brand ideals such as desire, status, new innovation and design. But lately I’ve begun to think retailers are losing sight of what makes it valuable.
If this carries on, what was once seen by consumers as a status symbol will quickly lose that status. Brand ideals will falter and desire will falter with it.
There is no doubt many of us are in this industry because we love it – but there are certainly others who view it as nothing more than a quick buck, easy money and take advantage of an industry built on trust.
In this respect our biggest enemies are not pressures on the jewellery industry, but pressures from within it. To me, the biggest evils are internet diamond ‘wholesalers’ and the practice of discounting. These may seem different, but essentially they do the same damage to the industry and the consumer.
Firstly, an internet diamond retailer advertises nothing except ‘Don’t pay more; buy at cost and save money’. This is in stark contradiction to the essence of the industry. How do these retailers promote wealth, status or innovative design? The answer is: they don’t.
All they do is tell the consumer: ‘Here is a cheap diamond; buy it and save money.’
With larger diamonds, in most cases they don’t actually sell them for much cheaper than the usual retailer anyway. All they do is poison the consumer’s mind to make them believe that diamonds should be cheap.
Lately this is a lesson the industry and consumers have learnt bitterly. If a business doesn’t make a profit and doesn’t look after its suppliers or customers, EVERYONE will be hurt.
We need to focus on the industry as a true luxury. Why should diamonds be cheap? The price of luxury cars, for example, is not based on metal or labour costs alone.
Sure there are cheap cars, but if a consumer wants a status symbol they buy a Mercedes or a Ferrari; a luxury brand. The consumer pays for these products because they present the ideals the consumer wants to be a part of.
Massive chain store discounts do the same disservice to the industry and consumers. Discounts of 50, 60 or even 70 per cent are ridiculous. Why would a consumer buy your product at full price if they can wait one month and get it at 70 per cent off?
Christmas Sales are the poster boy of this stupidity. Days before Christmas, consumers are looking for a special piece of jewellery – a valuable emotional gift. Days after Christmas the same store they felt was providing this emotional connection and value of love is now selling its jewellery at 70 per cent off! Where is the value for that customer?
All it does is teach the consumer there is no value in your product to start with. This starts off hurting the company that discounts but ends up hurting the whole industry, as consumers think that if the biggest jewellery companies can go on Sale regularly there must be too much profit in jewellery.
This ideal is wrong. If an online retailer claims they are selling a $16,000 diamond for $4,000, they are misrepresenting its value.
Discounts should be limited to genuine closing down Sales, or stock liquidation sales. If you have to ‘liquidate’ your stock monthly by going on Sale before you have even promoted luxury or desire, you are instantly promoting a worthless product.
Retailers should always buy according to what they sell, so there should be no issue of excess stock. Of course we all make bad stock purchases once in a while, but our stock does not have a use-by date – it can be salvaged and re-worked or re-designed.
The fact is, people don’t buy jewellery every day – I would say an average of once or twice a year. So why go on Sale more than customers shop?
Our business models shouldn’t be based on weekly turnover. The most successful jewellery businesses show long-term progressive growth in the value of their brand. Their customers know this and pay for the desire, the innovation or the status symbol.
Every person in our industry needs to stand back and look at the ideals they advertise. Many businesses will come and go, but the ones that are here to stay should focus on rebuilding the luxury ideals of our industry; desire, status and innovative design.
John Temelli, director/owner, Temelli Jewellery