Jewelry Marketers Can Find Exponential Growth that Will Reap Huge Rewards

Today's jewelry market is a $39.5 billion industry at retail in 2001, with sales basically flat over the previous year's $39.8 billion. The stale performance in the jewelry market in 2001 is largely attributed to the post 9-11 trauma, which kept many customers out of stores through the critical third and the beginning of the fourth retail quarter that year.

Sales by fine jewelers will remain flat unless they expand their focus beyond traditional gift-giving occasions and weddings, where the man is the primary buyer. To grow sales jewelry companies must reach out to the self-purchasing woman and meet her in shopping venues where she is inclined to think about buying jewelry.

Moving Beyond Traditional Distribution Channels

Jewelry sales are concentrated among jewelry stores, with jewelers credited with 54 percent of total industry sales or $21.346 billion in 2001. Non-store retailers, including mail order catalogs, direct response marketers, direct sales, television and electronic retailers, are the second largest retail distribution channel, accounting for 11 percent of total industry sales. This channel is growing rapidly, up 13 percent in 2001 over the previous year.

Department store sales of jewelry continue to lag, down 31 percent from previous year, while sales through discounters and mass merchants, some $3.558 billion, and other general merchandisers, such as members clubs, totaling $3.162 billion, are the fastest growing channel for jewelry, up 18 percent and 10 percent respectively over previous year.

Channels of distribution in the jewelry market continue to shift away from traditional venues, such as jewelry stores, department stores and apparel stores, and into new formats, most notably the discount mass merchandisers and non-store retailers. Today Wal-Mart is the nation's number one jewelry retailer with estimated jewelry and watch sales of $2.3 billion. This shift is boosting not just Wal-Mart but Kmart, Target and Costco into the ranking of the nation's top 20 jewelry retailers.