Chinese New Year & Valentine's Day
"With solid holiday sales recorded, industry looking ahead to Chinese New Year and St Valentine's sales"
Retail results for the Christmas holiday sales season appear to have turned out solidly, and that is giving confidence to the industry ahead of the Chinese New Year in early February and St Valentine's Day. Diam
onds and designer lines appear to have done particularly well, with few retailers reporting declines in sales on the same period last year and even those that did report a drop-off said that sales were about the same as those seen in the 2014 holiday season.
Shoppers appear to have left their buying till the last minute, probably in the hope of seeing prices fall as retailers came under pressure. Jewelry price Inflation fell during 2015, particularly because of the decline in prices of gold, silver and platinum, and that enabled many retailers to keep prices unchanged or to give a discount.
Retailers in the United States were also helped by unseasonably good weather during the run-up to Christmas which encouraged shoppers to head to malls. In addition, the price of gas, which has continued to decline, has put money into shoppers' pockets, making them less cautious about buying. As one retailer commented: "Sales were up strongly because shoppers were more confident. It's true that they didn’t buy more jewelry items than in 2014, but they didn’t question prices or ask for discounts as much as in recent years.”
Other retailers said that there was heavier foot traffic in stores during the holiday season, but that did not necessarily translate into more sales. On the other hand, some store owners said clients were in an upbeat mood about buying jewelry and it was clear that the economy is improving, with people buying big gifts. In states with relatively low unemployment figures or which are tourism areas, such as ski or beach resorts, consumer confidence was high and sales strong. Meanwhile, other jewelers reported solid sales as a result of competitors going out of business, as the consolidation of the retail jewelry sector continues.
Among the specific items selling well were diamond jewelry, such as necklaces, diamond stud earrings and engagement and promise rings, while watch sales were lower. Interestingly, retailers said that price points were either at the lower end or at the top end with the middle market appearing to be less firm. Many retailers reported significant sales of jewelry at under $500 and at $1,000 plus.
Looking forward to the Chinese New Year, diamond and jewelry manufacturers retailers are less optimistic due to slowing growth in China's economy, which is making consumers less willing to spend. In addition, an ongoing crackdown on corruption and the giving of luxury gifts to officials has reduced sales of luxury-end jewelry and diamond-set watches. In addition, a sharp decline on the Shanghai Stock Exchange on the first day of trading in 2016 has added to consumer concerns and may have an impact on retail sales in the same way as the previous decline during July and August 2015.
On the other hand, the strengthening American economy is giving the industry confidence in the run up to St Valentine's Day which is just one month away. The engagement ring market in the United States and elsewhere, which is always the strongest part of the diamond jewelry market, is gearing up for stronger sales. All the more so due to certain shortages in polished goods as diamond manufacturing since mid-2015 has been cut back due to large inventories that built up in the first half of last year.