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Jewelry Report, 2006 Update: The Who, What, Where, Why and How Much of Jewelry Shopping
Unity Marketing, June 2006, Pages: 185
Jewelry is the ultimate luxury and today's jewelry shopper is driven by an experiential passion that goes far beyond the item's features and benefits - They buy jewelry based upon emotion, not reason
In 2005 American consumers spent $59.4 billion buying jewelry and watches, posting a dramatic 10.2 percent two-year growth trend. As a category in the durable goods segment, jewelry and watches outperformed the overall durable goods sector, which only rose 8 percent in the same two-year period.
Jewelry and watches were purchased by about half of U.S. consumers in the study period, with 'twenty-something' to 'fifty-something' women with higher incomes representing the core target market.
For the last several years discounter Wal-Mart has been the nation's #1 retailer of jewelry, despite the fact that the prime target market for jewelry - high-income women from 25 to 54 years - are the least likely of all consumers to shop for jewelry in discount channels.
How are jewelry marketers and retailers to understand this dichotomy in the marketplace - that the nation's top discount sold more of the ultimate luxury good than any other store and that lower-income shoppers who spend under $100 on each item of jewelry bought have propelled Wal-Mart to their #1 position?
New Consumer Insights about Jewelry Shoppers, What They Buy and Where They Shop
We have completed a new study of the jewelry consumer market based upon in-depth qualitative focus group research and a quantitative research study of jewelry buyers shopping preferences, behaviors and attitudes. This research study includes research data and statistics about:
- Jewelry Market Size and Growth: What is the size of the jewelry market and how rapidly is it growing? How is the jewelry and watch market segmented by the type of jewelry product and material of composition?
- Demographics of the Jewelry Market: What kinds of households buy jewelry and how do different demographic characteristics impact and influence jewelry buying behavior, (e.g.: HHI, size, composition, ethnicity/race, education, etc.); what are the different demographic segments within the jewelry market? How similar or different are households/consumers who purchase jewelry for personal use and for gifting.
- Jewelry Buying Behavior: What are the primary characteristics of the consumers' buying behavior related to jewelry and why they buy, e.g. for self or for gift? Where do they shop for jewelry; how do they decide to purchase one piece vs. another; how do they set a budget for jewelry buying; what is the role of brand in jewelry buying behavior; how much do they purchase and how much do they spend on key categories of jewelry. How do men and women differ in their jewelry shopping and buying behavior?
- Psychographic Profile and Segmentation of the Jewelry Market: The psychographic profile of jewelry consumers will reveal their different drives and motivations in purchasing jewelry; what factors are more or less important in driving jewelry purchasing decisions; how can jewelry marketers and retailers better understand the hearts and minds of their consumers. In essence, we will discover 'why people buy jewelry.'
Specific Jewelry and Watch Data Included
This study examines both the fine and costume jewelry market segments, as well as the preferences and behaviors of gift buyers and jewelry self-purchasers. It provides details about jewelry choices and spending in four major categories of jewelry:
- Fine women's jewelry and watches
- Fine men's jewelry and watches
- Women's costume jewelry and watches
- Men's costume jewelry and watches
For the fine jewelry category, detail data is also included about metal of composition, such as fine gold, platinum, sterling silver; and gemstones, such as diamonds, precious gemstones, such as rubies, emeralds, etc., pearls, and semi-precious stones, such as amethyst, topaz, etc.
It explores what type of jewelry is bought within each category, such as necklaces, earring, bracelet, brooches and pins and how much shoppers spend on specific items of jewelry. Through the level of purchase detailed analyzed, marketers and retailers can discover the typical pricing parameters for each type of jewelry based upon what the typical jewelry buyer spends.
Jewelry Shoppers and Their Shopping Preferences Are Also Examined
Details about different types of jewelry shoppers are included, with special emphasis on the differing motivations and buying behavior of men and women, as well as gift buyers as compared with self-purchasers.
The study is of great value to jewelry retailers, both those that already compete in the category and those that want to grow their share of the market. It reveals the stores where jewelry consumers prefer to shop, including the top ten jewelry retailers led by Wal-Mart, as well as the nation's leading jewelry retailers in these categories:
- Department stores
- Discount stores
- Chain jewelry stores
- Fashion clothing stores
- Non-stores, including mail order, television and internet
The report reveals why shoppers choose the stores that they do to shop for jewelry. It explores many strategies for retailers to capture greater share of the jewelry shoppers' wallet.
This important new research study is an investment in the future of jewelry marketers and retailers. It provides data and insight so that jewelry marketers and retailers can maximize their opportunities in the jewelry market today, as well as to plan for their future.
Special Features in Jewelry Report, 2006 Update
Included in this report are:
- Profile of the affluent, luxury consumer market for jewelry and watches, including luxury jewelry and watch brand awareness and usage.
- 12 research-based Business Building Tactics to help jewelry marketers and retailers grow a more vibrant business.
- 7 major Marketing Opportunities that will mean greater success for jewelry companies and retailers that develop strategies to take advantage of these emerging opportunities.
METHODOLOGY
A research methodology combining both qualitative focus groups and quantitative surveys was designed to meet the defined research objectives. This report summarizes results of the quantitative jewelry consumer research survey, as well as the focus groups, plus new information collected during our Luxury Tracking study conducted throughout 2005.
FOCUS GROUP RESEARCH
A total of four focus groups were held, two groups outside Chicago, IL (Schaumberg, IL) and New York City (Fort Lee, NJ). The focus groups were conducted in May 2004. In each city, one group was recruited among fine jewelry gift buyers and one group among fine jewelry selfpurchasers. While it was expected that these groups would largely be divided by gender (e.g. men would make up the gift buyer groups and women the self-purchasers) the gender composition of each group was mixed. In fact, the NYC self purchasers group had more male participants than female.
This segmentation strategy enabled the research to investigate key differences in fine jewelry buying needs between men, primarily gift consumers buying for women, and women, primarily making self and/or gift purchases.
Respondents were prescreened to identify target respondents. The focus group respondents were between the ages of 25-to-64, with household income of $35,000 or more. All were recent fine jewelry purchasers, having spent $150 or more on the last piece of fine jewelry bought and at least $250 buying fine jewelry over the past 12 months.
QUANTITATIVE JEWELRY CONSUMER SURVEY
Based upon hypotheses and preliminary findings in the focus groups, we designed a research questionnaire suitable to field across a nationwide representative sample of about 600 jewelry and watch consumers. A total of 581 recent jewelry and watch consumers were included in the survey sample. The survey was conducted during September 2004 among a representative panel of U.S. consumers using an electronic internet-based survey platform. A copy of the survey questionnaire is included in the appendix of this report.
Survey respondents were screened for their purchase of any fine jewelry or costume jewelry in the past 12 months, from September 2003 to August 2004, including fine or costume watches. Only individuals who personally made jewelry purchases were included in the survey. Not unexpectedly the survey sample skewed female with two-thirds of the sample (66 percent) being women and one-third (34 percent) men. The sample was also composed of more self-purchasers (57 percent made most recent jewelry purchase for themselves) than gift-purchases (43 percent made most recent jewelry purchase as a gift). It is also no surprise that the majority of selfpurchasers (82 percent) are women, while the majority of gift purchasers (56 percent) are men.
Total industry sales data for the jewelry and watch market was obtained from the Bureau of Economic Analysis’ Personal Consumption Survey (NIPA files 2.4.5U) and was used to update industry sales figures in Chapter 2 of this report.. Total industry sales grew only 3.9 percent from 2005 to 2004. Given this fairly low level of industry growth, another comprehensive nationwide survey of jewelry consumers was not conducted for the 2006 update, but is planned for the 2007 sales year.
New consumer survey data on jewelry and watch purchases was collected in our Luxury Tracking Study, conducted quarterly among luxury consumers and reported in Chapter 7 of this report. For the Luxury Tracking Study, four surveys of luxury consumers, ranging from 600 to 700 luxury consumers for 1Q2005 to 1,100 to 1,300 luxury consumers for 2Q through 4Q2005, were conducted quarterly through 2005 with the results published in the Luxury Tracking Report. The quarterly luxury tracking surveys were conducted online using a panel of high income respondents ($75,000 and above household incomes) which roughly equates with the top 25 percent of U.S. households based upon income.
The average income of the 2005 Luxury Tracking sample was $139,075, approximately 2.3 percent higher than the average income of $136,000 in the 2004 sample. In 2005 the percentage of the sample representing near-affluents ($75,000-$99,999) was 25 percent; affluents ($100,000-$149,999), 45 percent; and super-affluents ($150,000+), 30 percent. This represents a fairly even distribution across all affluent income levels.
In 2005 women represented 65 percent of the total luxury survey sample, as compared with 35 percent being men. This gender distribution is roughly the same as found in 2004. The 2003 sample, however, was more evenly split by gender, with 51 percent female and 49 percent male. The average age of the survey respondents in 2005 was 42.9 years, virtually the same as the average age in the 2004 sample (43 years). Members of the baby boomer generation represented the largest share of respondents in 2005, or 47 percent, which is about the same as the 49 percent of boomers in the 2004 sample. GenXers represented 38 percent of the sample, up slightly from the 35 percent in 2004.
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