Interest in the fine jewelry industry is peaking: JCK, one of the biggest Las Vegas trade fairs held last month, hosted 30,000 visitors and upwards of 2,000 exhibitors this year, while both heritage and more niche, independent labels are garnering renewed attention from a new generation of millennial luxury shoppers.
These are shoppers with a different set of demands; namely, they are looking for personalised, quick and fuss-free services that won’t necessarily have them going into stores.
That’s one of the reasons why online players are jumping at the opportunity to grow their fine jewelry businesses and lure heritage jewelry brands to their sites.
Earlier this year, and within very close proximity to each other, Net-a-Porter and Farfetch went one step further debuting fine jewelry hubs, in a bid to become leaders in this growing segment of the market. These are dedicated spaces on their sites where the product is presented alongside editorial imagery and educational content around their brand partners.
For Net-a-Porter, it was a natural move, as the company has been working towards establishing itself as the “ultimate online destination for jewelry and watches” for the past two years. Along the way, it has secured exclusive partnerships with the likes of Cartier, Buccellati, IWC Schaffhausen, Piaget, Pomellato and Chopard among others.
Image credit: Net-a-Porter
As Richemont completes its purchase of the Yoox Net-a-Porter Group, the retailer’s focus on hard luxury is sharpening and the launch of a dedicated jewelry hub demonstrates its growth ambitions – according to the company, its aim is to grow the category 300 per cent by 2020.
It’s also a way for the retailer to further engage its highest spending customers – dubbed EIPs or extremely important people – hence why the new hub features a dedicated section called the Vault where EIPs can schedule appointments to discover exclusive, one-off pieces.
For rival Farfetch, launching a fine jewelry hub was a response to ongoing customer demand. The company also claims to have a younger, millennial-focused client base which makes it stand apart. It can therefore bring something new to the table by offering heritage jewelers access to a younger clientele and refreshing their image by presenting their product with trendy, modern imagery.
Farfetch launched its hub with brands such as David Yurman, De Beers, Tiffany & Co, Chopard and Pomellato, its focus being on big name brands looking for an image refresh and access to the much sought-after millennials. Farfetch’s marketplace model also allows the brands to retain control of the type and depth of product that’s presented on the site.
Image credit: Farfetch. Image: Farfetch's fine jewelry hub.
As the retail race continues, more online players will inevitably follow suit. Matchesfashion.com, which was bought by Apax Partners for a reported $1bn, is already looking at scaling its business, and fine jewelry could provide an attractive avenue for growth given the high margins and the fact that the product is almost never discounted.
U.S. e-tailer, Moda Operandi, is another key player in the market, known for targeting high net-worth luxury consumers and going after “serious jewelry buyers” by offering one-off, high priced items and imposing a strict no-returns policy.
As retailers compete to claim their stake in the market, what’s in it for the brands however?
There’s the increased exposure to new customers and new territories, yet as e-tailers present fine jewelry labels next to hundreds of other labels in their stock lists, there’s also a risk of losing the essence of luxury and exclusivity that’s so closely attached with the world of fine jewelry.
That’s why certain independent labels, from Jessica McCormack to Sabine Getty, are eschewing retail in favor of one-on-one interactions with their consumers. They are still adapting to the digital age however, by often instigating those interactions via Instagram, which is proving to be an alternative and equally powerful digital tool for jewelers.
Social commerce platform Threads Styling, is said to have sold fine jewelry pieces worth up to 30,000 pounds via Instagram.
It all comes down to maintaining a balance, according to luxury retail analyst Luca Solca, who believes that jewelers will remain focused on their own retail channels and on communicating with clients via social media “in order to maintain the higher margins and own the consumer data.”
“Brands will resort to wholesale only as a shortcut to get on the internet, or when traffic is highly concentrated – like in China for example – on a handful of platforms,” he adds.
Cover image credit: Chopard