US jewelry sales down, but watch sales up in April

(IDEX Online) - Watch and jewelry sales continued to slide in April, continuing the underperformance of the US jewelry and watch retail industry since the beginning of this calendar year. As such, the overall market growth of the US retail jewelry sector remained subdued, compared to the sales results of the same month in 2018. Year-over-year, total jewelry and watch sales fell 2.4 percent in April. Also, while total US retail sales dipped an unexpected 0.2 percent in April, watches and jewelry sales suffered a higher loss.

Mom-and-pop stores

In April, Specialty Jewelers - those retail jewelers that are often family-owned and therefore called mom-and-pop jewelry stores - continued to bear the brunt of the slowdown in sales. Sales dropped 4.9. percent compared to those realized in the parallel month of 2018.

As during the first three months of 2019, in April, as demonstrated by the data displayed here, overall sales continued to disappoint in the long term, not only when compared to 2018, but also when one looks at earlier years. These hard figures contrasted with the Jewelry Industry Confidence Index (JICI), a survey that was conducted by pollster MRI-Simmons, on behalf of JCK, among more than 500 US industry members. While last year, the JICI, which measures how positive retail jewelers are about their businesses for the next coming calendar year, 88 percent of the surveyed retailers were optimistic, for this year 86 percent were positive.

Specialty jewelers are suffering

In 2019, the independent retail jewelers, those jewelers that are part and parcel of the communities they live and work in, continued to see sales falling. More than ever before they are in direct - and often fierce - competition with the established, larger retail jewelry chains. The below graph shows clearly that throughout 2019, for independents, the decline in watch and jewelry sales in this important sector hurts.

As can be seen in the jewelry versus watch sales graph, watch sales usually keep in step with jewelry sales. This was not true for the first quarter of 2019, offering further proof of the rather volatile state of the market and consumers' reluctance to buy fine jewelry. On the other hand, some commentators noted that, since watches have been performing well in the first four months of 2019, consumers are not shunning retail jewelers: they're just not ready yet to spend their discretional dollars on fine jewelry.

Outlook

American jewelers are fighting a battle for survival on various "fronts." Asked about their biggest business challenges in the a.m. JICI survey, 67 percent of the surveyed retailers noted online competition; 56 percent the overall economic climate; 50 percent the lack of general demand; and 40 percent expressed their concern for the lack of interest in and demand by the Millennial generation of fine jewelry. Yancy Weinrich, Senior Vice President of Reed Exhibitions, stated during her State of the Industry presentation at the JCK show in Las Vegas, that "there is wide agreement that online competition is the enduring challenge of the era." However, she emphasized that "macroeconomic concerns are much more visible on the industry's radar this year."