NEW YORK — This has been a bright year for fine jewelry and the holiday season is showing early sparkle.
Many designers and retailers have had double-digit growth in the third quarter and early fourth quarter compared with the same period last year, despite a saturated market that added a few designer names.
Marshal Cohen, chief industry analyst at The NPD Group, a marketing research company based in Port Washington, N.Y., said 2005 has been exceptional in the fine jewelry sector.
“We have seen the migration of an individual consumer,” he said. “The consumers who buy apparel to express their personality are now buying accessories and in some places fine jewelry.”
Fine jewelry sales increased 6.4 percent to $48.1 billion in 2004 and are projected to hit $51.5 billion by year’s end, according to Jewelers of America, a New York association for retail jewelers.
The Diamond Information Center, the promotional arm of De Beers Group’s Diamond Trading Co., said diamond jewelry sales increased 8 percent in 2004 and reached a high of $31.5 billion.
The price of gold has been on the rise, only recently showing slight decreases. In the third quarter, there was a 56 percent increase in the demand for gold, according to a study by Growth for Knowledge Audits and Surveys for the World Gold Council, a marketing organization funded by leading gold-mining companies.
Trends from ready-to-wear have had a major influence on the fine jewelry market this season, with the bohemian and Russian influences remaining strong, encouraging consumers to pile on jewelry, whether it is real or fake.
“We’re in a decorated cycle,” said Roseanne Cumella, senior vice president of accessories for the Doneger Group, a buying and consulting firm. “The layering that’s happening in apparel is happening in jewelry. It’s all being driven by ready-to-wear.”
While categories continue to mingle and merge, more fashion designers have entered into fine jewelry.
Oscar de la Renta launched a line of fine jewelry on his spring runway here in September. The pieces include a multistrand “Y” necklace of lapis beads with diamond-studded finials. The line retails from $350 to $15,000 at the designer’s New York boutique.
In June, Carolina Herrera partnered with jeweler Faraone Mennella in a collection of 30 pieces ranging in price from $6,000 to $50,000.
Diane von Furstenberg and Vera Wang have been creating fine jewelry for a slightly longer time, von Furstenberg with a line for H. Stern and Wang under license with Rosy Blue. Both lines continue to thrive.
“Diane von Furstenberg is one of our top-selling collections,” said Ronaldo Stern, chief executive officer of H. Stern.
Major players in the jewelry market have been upping the ante, as well. David Yurman launched a men’s collection and a bridal line with diamonds, platinum and pearls. John Hardy is pushing its Cinta collection, combining seashells from Bali with gold and colored stones.
Charriol launched the Cignature collection, emphasizing the brand’s name with logo applications in subdued ways and its inventive use of steel, diamonds and white gold.
“Branded jewelry is key to us,” said Sue Anne Newberg, vice president and divisional merchandise manager for fine jewelry and watches in the U.S. for Saks Fifth Avenue. “That’s who we are as a store overall. [Saks is] a fashion-driven brand.”
Newberg anticipates modest double-digit increases in sales over last year’s holiday period.
This year also has seen the continuing growth of big jewelry companies, while smaller design companies are gaining momentum, as well.
Tiffany & Co. launched Iridesse, a retail jewelry chain devoted exclusively to pearls and pearl jewelry, in late 2004. There are five stores in the U.S., including one in The Mall at Short Hills in Short Hills, N.J., and another in The Plaza at King of Prussia in King of Prussia, Pa.
A Boca Raton, Fla., boutique is slated to open next month and the company plans to open 14 additional stores in the U.S. in coming years.
Diamond mining company De Beers SA and luxury conglomerate LVMH Moët Hennessy Louis Vuitton joined forces to open flagships in New York and Los Angeles.
“This is a very strong differentiation factor for De Beers,” De Beers LV ceo Guy Leymarie told WWD in June of the virtues of the company’s technology regarding diamonds. “We try to cut for beauty, not weight.”
Artisanal designers like Anthony Nak, Sarah Perlis and David Lee Holland are similarly making headway.
“We don’t look at them as ‘small’ designers,” said Lauren Kulchinsky, buyer and vice president of Mayfair, which has four retail locations on New York’s Long Island, that carry designers such as Nak, Rodney Rayner, Elizabeth Rand and Kristen Farrell. “They may have smaller advertising budgets, but they are really design ateliers.”
Prime holiday purchases, according to Kulchinsky, are necklaces and rings, with a focus on colored stones and white diamonds set in either white gold or platinum.
There are some clouds on the horizon for 2006, however. The effects of gold at a premium price, the increasing costs of materials like diamonds and a more minimal take on jewelry for spring could put a damper on business.
Some retailer and jewelers predict a decline in gold sales due to its nearly 17-year record high on Thursday at $486.30 an ounce. Friday’s price was slightly lower at $485.85.
“The prices of diamonds have skyrocketed,” said Ori Zemer, vice president of Charriol North America, which supplies stores such as Neiman Marcus and Bloomingdale’s with diamond jewelry and watches.
To compensate for the market changes, the company has upped its prices across the board by 10 percent. Despite this, he said his holiday sell-through is up 10 percent over last year.
Zemer believes the industry won’t suffer all that much in the end.
“Today, watches and jewelry have become an important part of a woman’s wardrobe, as opposed to just another accessory,” he added.