Christmas sales in the U.S. grew by just .7 percent from October 28 to December 24, according to a MasterCard Advisors SpendingPulse report. A significant drop from the same period in 2011, when Christmas sales went up by 2 percent. The report added that the 1.3 percent drop in holiday sales growth was due to holiday season jitters about the fiscal cliff, and the effects of Hurricane Sandy.
Retail jewelers interviewed for this Christmas 2012 sales report, from three different parts of the country, however, all had favorable holiday sales. Lucrative gift-with-purchase programs, customer appreciation parties, and affordable price-point jewelry in stock were the key success factors.
But not all holiday retail news was favorable. In mid-October the National Retail Federation (NRF) predicted that holiday retail sales would increase 4 percent compared to the previous year’s Christmas season. The .7 increase reported by the MasterCard Advisors SpendingPulse report this year missed the NRF’s fall forecast by 3.3 percent.
Trends Research Institute founder Gerald Celente shared his thoughts on some of the consumer spending habits that may have helped these jewelry store owners during the recent holiday season.
Gerald, who accurately predicted the dot.com meltdown and the last two recessions, said in an interview on FOX News on January 1 that according to his group’s research, parallels are being drawn between what’s happening now in our country and economy to the stock market crash of 1929, The Great Depression, as well as currency, trade and even world wars from that period in US history.
“People know in their bones that things aren’t right and they want to live it up,” says Gerald. And, with regards to the economy in 2013, it will be: “More of the same, but worse. The only thing keeping this economy going is cheap money.” He added that there was no “election bounce” in the economy.
But that wasn’t the case for Dorothy Vodicka, co-owner of The Gem Collection in Tallahassee, FL. Fourth quarter sales in her store were down in early November, but surged upward in early December and continued strong in the first few days after Christmas. A BIGinsight weekly consumer survey from December 4 to 10 shows that jewelry sales were already getting traction in that period. The survey indicated that 20.8 percent of the jewelry purchased during holiday season 2012 had already been bought by that period.
Dorothy and store co-owner/husband Don tried a few things differently this holiday season. They dispensed with the usual ladies’ and guys’ night events and held two high-end customer appreciation parties for their top customers, one in late November the other in early December. Although some jewelry was purchased during these events, Dorothy and Don benefited from residual sales after the events, which contributed to a 5 percent growth in holiday sales over last December.
The couple also had jewelry gift-with-purchase programs in December with Imperial Pearl that attracted a lot of attention. A store with a strict no-discount policy, customers were receptive to the program.
Average ticket sales for Dorothy and Don were around $735 in all categories. On the affordable end, silver earrings averaging $49 or more sold well, as did Pandora with average ticket totals around $200. Diamond studs and diamond fashion also performed well for The Gem Collection. Another big seller for the recent Christmas season was luxury watches with Longines and Rolex brands topping the list.
Longines watch sales averaged around $1,600 and Rolex sales were typically in the $8,500 range. Whether it was jewelry or watch purchases Dorothy, Don and their staff noticed a common theme with Christmas buyers. “Many customers mentioned they wanted to buy jewelry that would hold its value and had good durability,” says Dorothy.
At David Jay Jewelers in Warrington, PA, store owner Scott Slobotkin and his staff have been experiencing steady increases with holiday sales. But during the recent holiday selling season it was like the pre-recession glory days. “It was our best holiday since 2006,” says Scott. “Initial estimates put us at 50 percent over last year.”
Scott attributes the seasonal success to a multipronged approach including online and out-of-market sales. In addition to his website’s online shopping options, Scott is selling jewelry on eBay as well. He also created a jewelry display case at the Four Seasons Hotel in his area, which helped to drive traffic to the store.
Known for their diamond fashion, Scott added a lot of this steady-selling category to his inventory in time for the holidays. “Shoppers are more last-minute these days,” says Scott. “Having finished jewelry in this category in hand when customers wanted it resulted in about 10 to 15 percent of holiday sales.”
This holiday season Scott and his staff threw a customer appreciation party in addition to the store’s usual ladies’ night and guys’ night events. The 12-12-12 customer appreciation event resulted in far greater sales than the two gender-specific holiday events combined. Similar to Dorothy’s customer appreciation parties Scott says: “Not much was sold that night, but it put a lot of sales and custom jobs in the pipeline.”
The average Christmas season ticket sale at David Jay Jewelers was around $600. Achieving that average was a lot of $100 to $200 sales of price-point-friendly items and a significant number of $2,000 to $3,000 sales, namely in diamond fashion. On the high end, Scott and his staff rang in their share of $6,000 to $8,000 tickets to reach that $600 average.
Scott and his staff agreed that customers seemed to be more “carefree” with their money. “We saw a return of the customers willing to spend $3,000 to $5,000,” says Scott. “Over the last three to four years, these sales just weren’t there for us.”
In Racine, WI, Rasmussen Diamonds’ president and owner Joel Hassler and his staff had a stellar Christmas with a 70 percent increase over last year’s holiday season. A $200,000 diamond sale made for a very, merry December. “But even when we took that diamond sale out, we were still up 8 percent over last Christmas,” says Joel.
Joel, also a Gems One customer, ran two holiday promotions with the New York-based company. The first, a Black Friday electronics gift-with-purchase program resulted in better-than-average Thanksgiving weekend sales, and gave a strong start to the holiday season. Joel noted many customers mentioned how much they appreciated a non-jewelry gift to go with their purchase.
This program drove in higher-end customers, but the store’s first-ever flyer program with Gems One brought in many price-point shoppers on the affordable end. “This was the first time we ran this program and we’re thrilled with the results,” says Joel. “It helped bring in 100 new customers and 50 existing ones just for the flyer program.”
Of the 50 existing customers that responded to the recent holiday flyer, 45 of them didn’t buy jewelry gifts last year. “The flyer contained a lot of affordable price points which I think got people thinking about buying jewelry again this year,” says Joel.
Average ticket sales were around $200, with the sweet spot in the $226 to $499 price range. Overall Joel and his staff did well across the board in all jewelry categories. But a big seller for Joel was the new Davinchi Cut Collection from GALATEA, a valued vendor since a fall 2011 IJO (Independent Jewelers Organization) Show. The multiple colored stone set jewelry, that looks like a kaleidoscope from a top-down view, sold extremely well this holiday season.
“Even before Christmas I was selling one piece every two weeks,” says Joel. “During the holiday season I ran out of stock on all of my GALATEA Davinchi Cut jewelry and had them send whatever they could to me.” Average holiday season ticket sales for this collection of jewelry ranged from $1,000 to $3,500.