The two consumers segments key to the future of the fine jewelry business: Millennials & Self-purchasing Women
The two consumer segments that are key to the future of the fine jewelry business are Millennials and self-purchasing women. Understanding and responding to the values and priorities of these important consumers are critical for jewelers to develop effective marketing and merchandising strategies in a highly competitive retail environment.
Major changes are afoot in the jewelry industry, and retailers can’t afford to ignore them, advocates research conducted by the global luxury-forecasting firm, The Futurist, for The Plumb Club. With the change in gender dynamics and societal trends, the average jewelry consumer is likely to be a woman buying for herself, and customers are more interested in expressing their values and personality in the items they buy. Interest in sustainable practices is mainstream, and awareness is strong regarding concerns specific to the jewelry industry.
Mining for Millennials
With increased competition from fashion brands and newer jewelry companies as Millennials near their maximum earning potential, traditional jewelers are struggling to attract younger consumers to fine jewelry.
When you look at what Millennials care about and how they shop, heritage fine jewelry companies have traditionally embodied the opposite, catering to those who shop in store, for engagement or marriage-related gifts, and choose brands based on status, reveals the report. Millennials care more about self-expression, preferring to align themselves with brands and styles they feel represent them.
Millennial consumers care about a brand’s social responsibility, which comes into play in a unique way with diamonds and its mine-to-market journey. Consumers are becoming more educated about the products they buy and are advocating for ethical products with known provenance.
More than one-fifth of U.S. engagement ring shoppers surveyed in a recent DeBeers study say they care about the responsible sourcing of diamonds, especially Millennials.
Moreover, Millennials tend to dress up less for work and going out, so jewelers must shift their marketing to make their products relevant to their consumers’ lives. In the past, high-end jewelers courted younger shoppers to buy jewelry for weddings, anniversaries or as gifts. Now, they’re pushing the idea of buying jewelry to wear any time. Millennials, more than previous generations, are wearing jewelry in creative ways, blending expensive and inexpensive pieces.
Millennials are definitely interested in precious metals and gemstones, finds The Futurist, but turning them into customers requires modern products and marketing. The challenge is twofold: designing pieces that appeal to young shoppers aesthetically and cost wise, and then persuading them to buy jewelry for themselves any time and not just as the occasional gift.
When Millennials are buying jewelry, they often seek eclectic pieces from trendy brands like Gucci, and favor artisanal jewelry from small or new designers, or handcrafted works sold on Etsy.
Jewelers must engage these consumers in the way in which they shop. Fine jewelry is increasingly being shopped for online, even if the final purchase takes place in a physical store. Millennials go online to compare prices, search for product details, and look for discounts and promotions, finds DeBeers. Jewelers must arm themselves with the right tools and strategies to win in the new digital world or risk losing brand equity.
Courting Female Self Purchasers
If there’s a study that really illustrates the rise of self-purchasing women, it’s a recent one by DeBeers’ that identifies self-purchasing women as the consumer segment with the clearest opportunities for future growth in diamond jewelry. Self-purchasing women represent one-third of U.S. diamond sales (diamond bridal sales represent about half).
DeBeers advocates jewelers offer a selection of diamond jewelry that appeals to women looking to celebrate a personal milestone, or buy something special to self-reward. This should become as much a focus for jewelers as bridal.
If other accessories are any indication, women are buying products like shoes and handbags up to six times a year, except fine jewelry, cited Marty Hurwitz, CEO of MVI Marketing, a Los Angeles-based consumer market research firm specializing in fine jewelry.
But a study conducted by MVI in July 2018 finds a unique opportunity for jewelry brands with millennial self-purchase women, age d25 to 40, with household incomes of $75,000 plus. More than 51 percent of 1,001 respondents say they buy fine jewelry for themselves. Their top motivations: to get exactly what they want; to reward themselves for a milestone; just because; and to commemorate a special memory or trip.
“This is the luxury growth demographic of opportunity, because they have a 30-year-plus spending cycle that’s just beginning, their brand attachments still are in the formative stage, and their brand loyalty can be attained by factors like content engagement, style and adornment,” said Hurwitz. More than 51 percent of 1,001 respondents report purchasing jewelry for themselves. Their top motivations: to get exactly what they want; to reward themselves for a milestone; just because; and to commemorate a special memory or trip.
MVI research also finds that self-purchasing females, particularly younger women wish to see more variety in color and fashion styles well represented in fine jewelry stores. “They say they are interested in more color to go with their outfits, with at least one quarter of self-purchasing women expecting to buy jewelry containing a gemstone or pearl at least once in a year,” Hurwitz said.
Whether you’re reaching out to Millennials or self-purchasing women, The Futurist advocates jewelers move away from pure product pitching to connecting with consumers on a deeper, emotional level. Jewelers need to connect with consumers in how they live and spend their time. Brands must go beyond product and become more relevant in consumers’ lives.
To do this, jewelers must shift from storytelling to story making. Brands must stop telling a one-sided story that impresses their message upon consumers. Instead, they must create a broader message that is emotionally engaging enough to have a two-way conversation and create added value. It’s not so much about entertaining, as much as it is engaging consumers in a way that drives business.