The rules of the game have changed in accessories.
The category that has consistently outperformed all others in the last decade has come down to earth, unable to buck the economic storm of the recession and its impact on the consumer psyche.
Handbags succumbed early on when high-end stores such as Saks Fifth Avenue, Bergdorf Goodman, Neiman Marcus and Bloomingdale’s offered steep discounts even before Thanksgiving to induce customers to snap up bags from Balenciaga, Yves Saint Laurent and Pierre Hardy at less than half price.
The “It” bag? Not this year.
And fine jewelry and watches, which have previously resisted economic ebbs and flows for their gift-giving clout and intrinsic value, are still plentiful on Christmas Eve.
“When the rest of the store is 75 percent off, why would anyone want to buy full-priced fine jewelry?” said a retail executive, who asked not to be identified. “It’s been a tough season for jewelry.”
In a bid to drive sales, Saks this month offered a sale on several of its fine jewelry brands — a rarity in the world of gold, diamonds and pearls.
The unanswered question is whether this year marks a fundamental shift in the category.
But as unemployment rises, lower stock prices gyrate and spending and credit are squeezed tighter, 1,140 jewelry businesses have closed this year and bankruptcies are up 18.6 percent in the jewelry retail sector, according to the Jewelers Board of Trade, a credit and collections bureau. Among those that liquidated were Whitehall Jewellers Inc., Friedman’s Inc. and Crescent Jewelers.
As if that wasn’t bad enough, there is speculation among jewelers that the upheaval on Wall Street, including the Bernard Madoff scandal, is already forcing customers to return merchandise valued in the six-figure range.
This month, jewelry retailer Finlay Enterprises Inc., which runs leased jewelry departments in stores across the U.S., said in a filing with the Securities and Exchange Commission that its lenders are performing another review that could further impact the firm’s borrowing capacity. If the company can’t improve its liquidity, Finlay said it might have to “significantly curtail our operations or pursue other available options.”
Zale Corp., seeking to save more than $65 million a year, said it planned to cut more than 200 jobs and close 105 stores. Zale had a 0.7 percent dip in comparable-store sales in fiscal 2008.
Diamond jewelry retailer Kwiat has had a “very challenging” second half of the year after a robust first half, said Greg Kwiat, chief financial officer.
The sale of diamond engagement rings and wedding bands, however, has withstood a decline, but Kwiat said it’s hard to imagine any scenario for 2009 that does not continue to pose challenges.
“Consumers are likely to remain cautious and wait for sustained signs that the economy is beginning to recover before making discretionary spending decisions,” he said. “At Kwiat, we are taking a conservative approach and focusing on our strengths in engagement rings and wedding bands.”
Nina Segal, founder of jewelry boutique Nina at Fred Segal in Santa Monica, Calif., sees customers scaling down their purchases.
“We are not getting the big hits,” she said. “We are not getting people dropping $1,500 or $2,000. A big gift is $500.”
Even when they open their wallets, Segal said customers are careful about what they buy and often ask about the materials used in the pieces.
“If something looks too expensive, they probably won’t really bother,” she said. “People are questioning the value of what they are getting for their dollar more.”
Jewelry lines that customers believe provide value are outshining the competition. Segal singled out Disney Couture, Liquid Metal and Nash, which Segal makes with Ashleigh Cohen, as standouts because they give customers the ability to get desirable pieces for $200 or less.
Orly Haroni-Ohebsion, owner of Moondance Jewelry Gallery in Santa Monica, Calif., and Miriam Fleming, owner of Miriam Claudette Jewelry & Accessories in West Hollywood, Calif., stressed that price point variety was critical this holiday shopping season. Haroni-Ohebsion said she’s brought in items priced as low as $10 for the first time.
“People are holding back; it doesn’t seem like Christmas at all,” said Haroni-Ohebsion. “We are in a very good area where people are not losing their jobs and their homes, but there is a feeling of ‘How can I indulge in luxury when people are having a hard time?’”
With customers troubled by macroeconomic issues, jewelry that conveys meaning to its wearers is finding an audience. For example, Sydney Evan’s pieces with hamsas (hands) are top picks at Miriam Claudette and Moondance, which is also finding success with the lines Blee Inara, Lena Wald and Pilgrim.
“People are really going for something that is uplifting,” Fleming said.
In addition to pieces with meaning, styles that are versatile are gaining traction. Haroni-Ohebsion pointed out that Chan Luu pieces priced around $200 that can be worn as single long necklaces, double necklaces or wrist wraps are popular.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast