Saturday, November 20, 2010

Sparkly Stuff under the Tree

Could it be a diamond?

Jewelers Optimistic About Upcoming Holidays

How will the holiday season be for jewelers this year? Better than expected due to the rising popularity of silver and consumers' penchant for gifts of enduring value, according to Buxbaum Jewelry Advisors.

In a news release issued last week, Buxbaum President Stevan Buxbaum said that today's consumers have an increasing appreciation for items that offer enduring value, unlike "throwaway" imports or nearly instantly obsolete electronics.

"People are using their hard-earned money to buy fewer items," he said. "The dramatic increase in the price of gold has not been lost on them. So there is more respect today for the intrinsic value of jewelry, and that is helpful for jewelers."

But the battle for customers' dollars this holiday season will be fierce, Buxbaum adds. In order to compete, independents need to offer deals but also emphasize their knowledge, experience and customer service. During the holiday season, retailers need to leverage the relationships forged from bridal sales made throughout the year.

"This year, jewelers should promote more than ever," Buxbaum said. "After all, we are already starting to see a barrage of aggressive promotion from department stores, the large chains like Zale and the warehouse stores like Costco and B.J.'s Wholesale Club, which have been doing big business in jewelry lately. The reality is that the promotional landscape will be extremely robust. If you do not join the fray, you will be left behind."

Product-wise, he said silver and beads would be popular in 2010, noting that many jewelers already have wisely expanded their price points with silver. Retailers are offering higher-priced silver products, such as diamond-studded silver bracelets, as well as new products such as Pandora's silver and silver-core Murano-glass beads, which allow consumers flexibility in how much they spend.

"This will be the year of silver and the year of the bead, with many consumers expected to put together their own bracelets," he said. "Maybe dad buys mom the bracelet wire along with a $200 diamond-inset bead that goes with it, and the kids each buy her a $25 or a $50 bead. The next thing you know, mom has five or six beads, and she can go buy herself a bead a month later. It is clever and gives people control over cost."

Buxbaum Jewelry Advisors is comprised of a team of jewelry professionals who have provided financial solutions to retailers and wholesalers for more than 20 years. It is an affiliate of Agoura Hills, Calif.-based Buxbaum Group, a liquidator of consumer products and appraiser of retail and wholesale inventories.

(Source: National Jeweler, 11/12/10)

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