January/February 2003 • To the Finish • Economy Dominated Jewelers Sales in 2002 • News & Updates • In This Issue

Spending and Buyers' Moods Flat for the 2002 Holiday Season
By Martin Stone

Retail sales figures announced after the holidays were lackluster, but many independent jewelers reported that last-minute buying and big-ticket items helped them over the hump, and that, although sales were slower, they were better than expected. But most still reported that the mood was different this year, with buyers seemingly less in the holiday spirit.

Tanzanite remains a buyer favorite. Photo courtesy Groh + Ripp.

Many retailers attributed a general feeling of uncertainty among consumers to the procrastination trend. "They wait as long as possible to see if anything is going to happen in the world, then make their decision to make a purchase," said Keith Hurdle of Hurdle's Jewelry in Boulder, Colorado. "It's a little weird, but its kind of the impression I got."

"No, it didn't feel like Christmas," he added. "People were in here shopping, getting what they needed to get, but they were on a mission. People are still taking everything very seriously at this point. There's the potential of lay-offs, there's the potential of war — a lot of negative stuff going on right now," Hurdle said.

"It was kind of an unexciting, non-inspiring season, even though we ended up just ever so slightly ahead of last year," said Richard Chappell of Chappell Jewelers in Wilmington, Delaware. "There was no great excitement, no enthusiasm to speak of. Holiday spirit seemed to be lacking." He, too, attributed the lassitude to general global conditions. "The economy's off, people are worrying about what's going to happen in Iraq, whether they're going to be employed next month. It was a lackluster performance and it amazed me that it even came in as good as last year." He thanked, "one or two or three nice sales" for carrying the season. "The general traffic did not carry it. It was off. I think peoples' price points were lower than last year."

Hurdle agreed that customers were buying lower-priced items. "It was an off-price-point year," he said. "We were either under a thousand or we were typically up between four and nine thousand." He reported that amethyst, garnet, and blue topaz were big sellers for his store.

Among those stores that did well, most reported that the majority of their sales were at the last minute. Toby Joseph of Joseph's in Des Moines, Iowa, said "We were actually up [in sales this year]. We weren't expecting to be up, but I guess I listen to the TV too much. We had huge days on December 22, 23, and 24. That put us over the top, and we had the largest, positive day after Christmas we've had in years. We did very well on the high end. A lot of people understocked, especially on the higher end. But we were overstocked . . . and when people came in looking for it — we had it."

However, the national malaise was apparent to Joseph as well. "The common theme I heard from a lot of people — a lot are fed up with the economy and the money that was lost. They're tired of putting money away and having it go down in value and they say ‘I may as well go ahead and spend it.' I'm sure that will change once the market starts going up — they'll be right back in."

But, for the most part, jewelry and gem sales were flat, about the same as last year. John Green, owner of Lux, Bond & Green in West Hartford, Connecticut, said his holiday sales were about equal to 2001. "We're an upscale jeweler, so for us, it was prices from $250 to probably $2500. But for me, those aren't my higher prices. The pieces that are $15,000 didn't sell. I think we were lucky enough to have a lot of the right styling for what the consumer came in to look for this year. There was definitely an increase for well-priced sapphire, emerald, and ruby. We also did quite well with blue topaz. Tanzanite definitely had an up-tick, and the citrines again sold strong."

But, Green concurred, "There was definitely not a very strong holiday mood until four days before Christmas. In the northeast we had a white Christmas, so we had the spirit in the air, but I think with the stock market and international conflicts blasting the news, the news media telling everybody don't shop because nobody else is, I think that made for a difficult year."

Jack Franklin, manager of Fishel & Dowdy in Ft. Meyers, Florida, called his season, "low to medium. People were not really willing to, ready to, let go of the kind of money that they previously might have. They were being very conservative and staying very much within budget or under budget. I think they were mostly shopping — somewhat of a bargain hunt — even right down to the last few days. They were saying, ‘Well I have three more days until Christmas, and I think I'm going to shop around and look for bargains.'"

"Business was not as good as last year but better than the year before," reported Bill Berthet, owner of Berthet Jewelers in Jacksonville, Florida. "I found this Christmas season, and this is my 20th in this store, to be very inconsistent. One day it would be fabulous, two days that should be very good were not, then another really good day. There was nothing consistent about the whole month of December."

Scott Engle, owner of Lynn Jewelers in Washington, D.C., said this year's sales were about the same as for the past three years. "People did seem to want to buy lower price-point items. It takes a lot more of those." Sapphires topped colored stone sales. "Traffic definitely peaked toward the end," he reported. "People were last minute. I think they realized they had a shorter season. This was not a happy, cheerful season. Generally, this area is experiencing a lot of turmoil. We've got a lot of government employees gearing up for a lot of things which are potentially unpleasant."

Engle said he is "cautiously optimistic" for the coming season, with everything depending on what happens in the next few weeks politically. "It could be fantastic or it could be a bust."

"I think the first six months of the coming season will be difficult, especially with the build-up [to a possible war with Iraq]," Edward Perry of Connecticut-based Perry Jewelers predicted. "It depends on how long it takes and what goes on. Once we get past that, I think things will change."

Barry Kessler of Kessler Jewelers in Burbank, California, said he's optimistic for the season ahead. "Obviously we're all looking at what's going to be happening in Iraq in the [coming] weeks. We had the feeling that people were a little more apprehensive to buy big items, but hopefully it will be quick and we'll be able to come to some sort of normalcy."

As for the year ahead in gemstones, most retailers agree that the classics that sold well during the holidays — specifically blue sapphire — will remain big, but as the cautious mood is lifted, trends will change. "I think colored stones are going to be strong this year," said Green. "I'm going to Tucson, and I think blue topaz and tanzanite will be strong, all the pastels, as well as the warm colors, such as the corals."