Modern Jewelry Trends

What kind of marketing campaign costs very little but reaches thousands, perhaps millions of consumers? Viral marketing campaigns are a marketer’s dream because your audience spreads your message so you don’t have to. Consider OfficeMax’s ElfYourself campaign, now in its third year. Last December, 39 million Americans and more than 100 million worldwide visited ElfYourself to make videos of themselves as dancing elves.

Now the jewelry industry is getting in on the trend with Hearts on Fire’s new viral campaign. Consumers can visit the Hearts on Fire site to create a customized interactive virtual snow globe with their own uploaded photo that they can email to friends and family. The snow globes are cute, with floating diamond “snow” giving only the gentlest of holiday hints. (See a screen shot of the globe card I made below, without the shaking and snow but you get the idea…..)

That gets at the tricky part about viral campaigns. To succeed, they have to be fun and largely non-commercial. ElfYourself is silly and enjoyable for a wide audience but does it make people buy more office products at Office Max? That’s harder to measure. Certainly traffic to OfficeMax.com spiked during the promotion. But if you made an elf video last year did you remember it was brought to you by OfficeMax?

Will the Snow Globe campaign boost the Hearts on Fire brand? “Our goal with this promotion is to create a new and exciting way for people to send holiday greetings this year, while providing a fun, casual environment to shop for diamonds,” says Caryl Capeci, Hearts On Fire VP of Marketing. “The customized snow globes, complete with sparkling diamond snow provide the ideal setting to ‘drop a hint’ for that perfect holiday gift.”

Since most jewelry brands don’t have widespread name recognition, successful viral campaigns can definitely boost brand awareness. And since the Hearts on Fire campaign is not at all edgy, it doesn’t risk the company’s luxury image. It may help to make the brand feel more warm and approachable too, which is no doubt a plus for any fine jewelry brand. The snow globe concept is nicely integrated with the product showcase too.

Compare the Hearts on Fire viral effort with the Diamond Disco game from The Diamond Store, an online jewelry retailer in the UK, and you can see how viral can be dangerously cheesy (but fun too) for those seeking to control a brand’s image.

Thankfully, the subservient chicken doesn’t wear diamonds.

More consumers shopping this holiday season are putting their purchases on layaway. If you’re not old enough to know, that means they are making monthly payments to own an item that they’ll pick up when it’s fully paid for. Before credit cards were ubiquitous, layaway was much more common. Sears dropped it in 1989 (except for jewelry) and Wal-Mart in 2006. The only faithful fan has been K-Mart, who now sees its layaway program as a big competitive advantage. It’s even stepping up layaway promotions this year, betting that with many consumers up to their credit card limits and short on cash, layaway will be an increasingly attractive option. In fact, Sears just reintroduced layaway only for this holiday season and smaller retailers are jumping on the trend too. Perhaps layaway will make a comeback in jewelry stores too, especially for big-ticket must-haves like engagement rings.

“I know this is weird for a retailer to be saying this, but I’m very encouraged,” Kmart CMO Mark Snyder says in a recent interview with Brandweek. “You can sum up the reason why in one word: layaway. Kmart has had it as its core value proposition for the past 40 years, but this year it was obvious that where the economy was heading and the concerns that our shoppers had about being able to give a great Christmas to their families this year. They were looking for options that would help them budget better and layaway turned out to be the thing that was most interesting to them, most compelling.”

Many retailers of large items don’t like layaway because of the space needed to store items. In previous years, some layaway items were actually stored in rented trucks parked at stores before the holidays.

Why not just save up the money and buy the item? As moms can testify, sometimes saving up and waiting until the last minute may leave you without the season’s must-have toy or game console. Layaway reserves an item and also keeps it hidden from curious kids, since the retailer keeps it until it’s paid for. “To be able to go out to Kmart and get those things while they’re fresh on the shelves and know that you’ve got them put away and know that you’re making payments on them every week and you can pick them up before Christmas, that’s a pretty good feeling,” Snyder says.

For retailers contemplating the renewed popularity of layaway? Not such a good feeling: remember, layaway was invented during the Great Depression.

What is in store for jewelry this holiday season? No doubt, we’ll see discounts on low-end jewelry at the majors. The first signs of the season are the previews of Black Friday ads, which are beginning to hit the deal sites now. Not all the retailers with ads available now are as aggressive as Sears, who touts an extra 20% off jewelry already 70% off in its Black Friday flier. But some majors are also offering Thanksgiving-only discounts in an effort to lure shoppers out one day early to work off that turkey: for example Meijer has 75% off gold jewelry on Thursday.

So what kind of deals are being promoted? J.C. Penney has 40% off all diamond jewelry, 50% off sterling jewelry, and 65% off all gold and sterling silver jewelry. Some featured items are a sterling silver and diamond snowflake pendant for $33.99, one carat total weight items for $199-$799. J.C. Penney’s one-carat Journey pendant is $499.99.

Sam’s Club has nicely designed 1 cttw diamond studs, which have quarter carat centers surrounded by pave, for $692. Sam’s Club is also promoting a silver cuff with gold accents for $148.58.

Kohls has the item of the season, 1.5 cttw diamond stud earrings, for $999.99, 1 cttw “IGI Certified” diamond stud earrings for $1,119.99, and other 1 cttw diamond stud earrings for $599.99. All fine jewelry is 68% off.

Sears has 1 cttw jewelry for $199-$699. Kmart has 70% off fine jewelry. Target has jewelry a relatively modest 50% off. The retailer is also promoting a cubic zirconia and sterling silver Journey pendant, which has to be a sign that the s-curve pendant has seen better days.

The latest ring style has that “fresh picked in a diamond mine” look. Pave flower rings are sprouting up all over, with celebrities on both coasts sporting the big blossoms on the red carpet.

In one of the best recent examples of the look, Ali Larter (who according to the Heroes blogs may have flower related powers to boot) wore a dramatic Bochic jade and black diamond flower ring to the Alberta Ferretti flagship store opening hosted by Vogue in Los Angeles.

The style isn’t new: Roberto Coin’s enamel rose rings have been popular since 2007. Modern Jeweler has also featured interesting examples from La Reina, Sevan, Super Bell, and DiLuca. But the trend seems to be accelerating along with the sixties pop-art flavor of jewelry fashion today.

But does a rose-shaped ring smell as sweet? Maybe. John Hardy’s new couture collection includes a whole bouquet of flower-power “scent” rings that open to hold a drop of perfume.

With the global credit crunch affecting financing of the diamond and jewelry industry, India’s Gem & Jewellery Export Promotion Council has asked the diamond industry in India to stop importing diamond rough for one month, beginning on November 25. GJEPC, the apex body of India’s industry, has 6,500 members, including all of India’s major diamond and jewelry exporters.

In a statement on Friday, the GJEPC explained its action as a defensive move to protect the interests of the industry: “This will also send signal to the banking system that the diamond industry will not increase its indebtedness at the time when our downstream colleagues continue to meet consumer demand, a demand heightened by the inherent value which consumers attach to our product.”

The move has support in India and in the diamond manufacturing industry worldwide. At the Antwerp Diamond Symposium on Monday, Moti Ganz, President of the International Diamond Manufacturing Association, called the GJEPC’s move “a brave and important step.” World Federation of Diamond Bourses President Avi Paz also called for miners to decrease production and manufacturers to reduce buying in his speech in Antwerp.

The rough import ban will essentially shift the credit pressure upstream to the mining companies. If India’s large diamond manufacturers respect the ban, they will have to cancel or delay commitments to buy rough from producers. As Vasant Mehta, the Chairman of GJEPC puts it, “Our move will basically cause fewer rough to enter the diamond pipeline and the producer companies will thus indirectly share in the financing burden and contribute to a faster restoration of normalcy in an otherwise healthy business.”

Adhering to the ban would prevent DTC sightholders and Rio Tinto Select Diamantaires from accepting December rough allocations. There is a DTC sight scheduled from December 8-12.

“If customers of the producers take goods at the next sale, they will not go against the trade and send it here. We can not control or monitor it, but I believe everybody is unified in this,” Sanjay Kothari, the past chairman of the GJEPC told PolishedPrices.com.

As you might expect, diamond producers aren’t wild about the idea. “As we announced at the last Sight, De Beers is fully prepared to reduce production to reflect the prevailing level of demand for new rough diamond supply from our clients,” says Lynette Gould, De Beers Group Media Relations Manager. “We do, however, believe that our clients are best placed to decide upon their short-term rough diamond requirements and, as a result, the ‘blanket ban,’ between the 25th of November and the 30th of December is an unnecessarily blunt remedy.”

“The health and dynamism of the Indian diamond industry is important to Rio Tinto,” says Jean-Marc Lieberherr, Rio Tinto’s General Manager of Diamond Sales and Marketing. “We have had a long and mutually beneficial association and we remain as committed as ever to this relationship. Our approach continues to be to work very closely with our Indian and non-Indian customers to find together the best way forward, in the spirit of partnership. We have great confidence in the future of the industry and in the inherent value of our product, and as we face short term challenges, we also all have an opportunity to build a stronger business together.”

The measure also may be criticized for decreasing employment in India. In addition to further weakening companies that do not have enough rough stockpiled to keep operating during the month, the ban is also like to affect many of the hundreds of thousands of people employed in India’s gem and jewelry industry. Even before the import freeze, Surat layoffs have been estimated at 50,000 cutters. Many diamond cutting factories that closed for Diwali in mid-October have remained closed and are likely to stay that way through the end of the year.

Mehta says that many factories should be able to continue operations during the month. “Our members have sufficient rough diamonds in stock to minimize the impact on our labor force,” Mehta says.

As visions of Camelot dance in our heads, first-lady-in-waiting Michelle Obama’s wardrobe is getting a lot of attention. Could she be fashion’s new Jackie O? Her election night ensemble, a straight-from-the-runway red and black dress by Narcisco Rodriguez didn’t get unanimous approval from the fashion police. But can we all agree the diamond earrings were spectacular? Loree Rodkin designed the 18k white gold and diamond triple dangles with oval, marquee and pear shapes which retail for $10,275. The earrings combine the new medallion silhouette with flattering movement that really caught the light on stage at Grant Park in Chicago. Michelle wore an elegant stack of what appeared to be silver and diamond bangles too. Right on trend.

But so far, Michelle’s strongest impact on today’s jewelry trends is bringing back the brooch. It’s a recession-proof lesson on personalizing your style: she uses stylish large brooches to dress up simple affordable outfits from national chains like White House Black Market, which she wore on The View, and J. Crew, which she wore on The Tonight Show. (J. Crew’s web traffic increased 464 percent!) Many of her pins are from Erickson Beamon. If she keeps expressing her own style through accessorizing, she’ll become a true style icon and a boost for the jewelry business. Not to mention a sought-after customer! Unlike stars on the red carpet, Michelle owns the jewelry and clothing she wears, including those stylish Loree Rodkin earrings, seen close-up below, which would be perfect for an inaugural ball, don’t you think?

In what it’s calling an “unprecedented initiative in a time of unprecedented change,” De Beers announced it will double spending this holiday season to remind consumers that diamonds have enduring value in what it says is its “strongest holiday program ever.” During the holiday season, 97 million American consumers, half the adults in the country, will be reached six times each with the diamond message. And that message will be in a new language to suit the new era.

“We have an opportunity to tell a story that is different to mere luxury,” explains David Lamb, chief strategic officer of Forevermark, the De Beers marketing division. “There are lots of brands and products that can’t do anything but pull back. For some, the only strategy is to slash prices. But it is perfectly possible to reshape the diamond message to suit the times. Consumers want deeper relationships with fewer things.”

The focus on diamonds as the ultimate icon of enduring value is based on extensive consumer research during the global economic meltdown in October. Despite the downturn, diamond jewelry is still the preferred gift of 41 percent of men and 30 percent of women with household incomes over $100,000. That’s more than either large or small electronics.

“We must increase diamond jewelry’s share of the luxury pie because that pie is shrinking,” says Claudia Rose, director of brand strategy at JWT. “Consumers are somewhat unhinged, regarding non-essential purchases with skepticism. We must continue to attract the core midmarket to elite consumers that are the market’s engine of growth. And we must keep the dialog alive in an industry with a long purchase consideration.”

Value is key to consumers today: 84 percent of women and 75 percent of men said that value for money was now the most important in choosing a gift. But 87 percent prefer something that is a bit more expensive now that will still have value in a few years. Reminding consumers that diamond jewelry keeps its value resonates with the attitudes of consumers today.

It’s all part of a cultural shift toward “fewer, better things.” And women don’t mind combining gifts from several occasions to get a diamond. “Eighty percent of women say they would prefer one special gift, rather than several small ones,” says Emmy Kondo, Diamond Promotion Service Planning Director.

Diamond studs are expected to be the item of the season, with 17 percent of consumers selecting them as the jewelry item they would most prefer. Classic jewelry including a three stone ring, a diamond solitaire necklace, engagement ring, and journey s-curve pendant and drop earrings will be featured in the ads. Rather than focusing on one beacon product, the ads are focused on the whole diamond category.

“If you think about a pair of studs for $1,000 that you will wear four times a week, the cost of wearing them is equivalent to a cappuccino,” Lamb says. “Which is the better value?”

The spending surge follows years of decreasing spending in the United States market as growth slowed. “This demonstrates our seriousness in promoting the category to everyone’s benefit,” Lamb says. “The American market is 52 percent of the world’s diamond jewelry sales. There’s one locomotive of this industry and it is America: we need to get that right.”

The campaign will combine television, with a revamped version of the popular “Hands” commercial now set to an instrumental version of the song “Stand by Me,” print, and online. The perennial “Seize the Day” print and outdoor campaign will be mothballed in favor of a more restrained print campaign with longer copy that explains the value message. “Seize the Day is a piece of advertising that shouts at you. Instead of something assertive, we wanted to have a conversation. It more suits the mood of the country,” explains Richard Lennox, group account director for the De Beers account at JWT.

The ads are white, with a framing black vignette that suggests a spotlight. Headlines include: “Two Things Last Longer Than Time. Love is One of Them,” “Here Today, Here Tomorrow,” and “Fewer Better Things.” Copy includes phrases like “wiser choices” and “reflect on things that last.” They are quieter, more sincere, and more intellectual than the clever tone of Seize the Day, more of an Obama flavor to Seize the Day’s Bush. Placements will include 128 full page color ads in national and local newspapers, as well as magazines like The New Yorker, Newsweek, Business Week, Barrons, and Fortune. Online ads will appear on TheWallStreetJournal.com, BBC.com, and Sportsline.com.

Diamond Promotion Service will have promotional materials and a poster and pocket card with sales scripts available on www.dps.org.

The advertising will start early before Thanksgiving and then surge late. “We always save money for the last minute because the trend for a later season will probably continue this year and we want to make sure that diamonds are represented,” Lamb says.

Will the value message be overwhelmed by the discounting that is expected to be the overall message this holiday season? “If I were a jeweler, I would certainly be looking at the right price point for my inventory,” Lamb says. “But it’s our leadership role to tell the positive so consumers will respond to promotion in a different way. It’s now enduring value at the right price.”