It is imperative for the jeweler of the future, to understand the differences between customers – The young, the families with children and the seniors. At the same time, the store needs to change and adapt so that it fits with the needs of the future. Without an active profile on new media, the store will disappear. With it the customers can be lured into the store even during the crisis. Without the internet, it’s not going to fly.
We people have felt an urge to wear jewelry for a long time. From the cave painting in Southern Europe, we know that approximately 32.000 years ago the Cro-Magnons decorated the naked female form with body-tattoos. Excavated graves from the ice-age tell us that ice-age people wore jewelry in the form of animal teeth, bones and conches.
The use of jewelry, materials and fashion are changed by new tendencies and historic events, but there’s no reason to believe that the use of jewelry is about to die out.
But new times demand new materials, new ways of selling products, new places to sell and new ways for consumers to experience products in Denmark and abroad, in order to ensure the survival and growth of the jewelry industry.
Different generations and how they want their prices, products and services
The next 10 years will be influenced by two huge consumer generations; the young between 20 and 30 and the seniors. Over the coming 10 years, the number of young people will grow by 20% and the seniors will particularly be the big generations born in the 1940s – 40% bigger than their predecessors.
The young people are the first generation to actively accept shopping as a fun and entertaining element in their everyday life. They shop, exercise, meet friends and partners on their trips between stores on shopping streets and in malls. They are funshoppers and most of what they buy is bought impulsively, because it inspires them and from special sales that take place right that moment.
As consumers of jewelry, they move naturally from one art style to the next. Going from piercings to pearls in a matter of years or months isn’t a problem for them. The transition from one art style to the next is a part of their culture and self-branding. They are invested in personal style and aren’t brand-enthusiasts like the generation before them. It is rather the opposite of this because who wants to wear the same brands as 9-12 year olds – such as Gucci bags and Burberry clothes?
A new style every week means many purchases and the need for many shopping trips. The young usually rent and they try to have as few fixed expenses as possible. That means more money for fun and games - go out partying, shopping for clothes and jewelry and other nice things. It’s expected of Jewelry and watches that they can be incorporated into several styles or that they’re affordable, since accessories need to be acquired and restyled several times per year.
The result is that jewelry goes from being investments to consumer items just as it has happened with clothes and decorating in the past.
Since the young people love to shop and lounge about in and around stores, it takes quite a lot to catch their attention. They need to experience changes, new products and new ways of staging the stores and its content before it catches their attention.
Google it! Is the first way into the store and its products when you’re young. The internet is the information searching spot nr. 1 and therefore also the first choice when purchasing and it’s the store’s digital visiting card to the world. A boring and static website, where the products are presented in uninspiring and inactive formats, are discarded by the young. This also means that they dismiss the store and the product. Quite a few young people don’t use normal PCs or laptops to get online, but rather an Iphone or other smartphone. If the website can’t be accessed on those, the store won’t exist for the young.
The other large group of consumers is the Babyboomer or 68-generation – the large post-war generation. Many of them have a lot of funds tied into houses, pensions or other savings and they are the first true consumer generation – created during the 1960s upturn and progress. They are major consumers of travels, experiences in music and culture and of consumer goods if they receive the correct guidance and service.
The seniors prefer a longer shopping-trip with their spouse or a friend, perhaps once per month. It’s critical that the day becomes a good experience for everyone involved. As consumers they’re very preoccupied with the right environment – for example how the store is placed in the city, closeness to other good stores, good places to eat and cafés in the area, the absence of noise, that items look inviting and the good personal service in the store. If the environment is good, it gives the optimal conditions for a lovely shopping trip.
As consumers they prefer talking to a person who is competent and friendly. They prefer personal service – on the phone as well, which is their electronic media. The internet is also used, but only for buying travels and doing business with their bank if they’re sure they won’t get cheated.
The generation is preoccupied with good quality and the good experience in the store. Their way to the store and its products are via the physical store. They are the last generation who are loyal to the store that they’re used to and where they know the employees and the store owner. It makes them feel safe and makes them want to be consumers.
Many of them already have the jewelry and watches that they need, but they can be tempted to buy more if their surroundings, products and employees understand them. It’s an art to create a desire to purchase things, in the consumers that have 50-60 years of experience in spending and buying, but satisfaction is a relative thing. It’s possible to create desire, even in 70 year old women. At the same time they also often buy gifts to their grown children and grandchildren and want the correct, personal guidance for their purchases. They want the recipient of the gift to be happy because it was the right choice of gift and here service is paramount. The indirect way to their shopping goes via their interests and sometimes their knowledge of their children and grandchildren.
The old core-customer
For many years, the core-customers in the jewelry business have been women around 35 with 2-3 children. There will be fewer of this group over the next 10 years. For the entire group of 30 to 45 year olds, the drop will be 20% over the next 10 years. We also know that this generation of women is different from the young, because they’re seeking personal success and want the perfect life. That also means the right jewelry and brands. Their jewelry is meant to signify success and control over life and express their way of life.
This group of consumers is the one that buys the most online. They’re major consumers via the internet because two jobs, small children and a busy life mean that it’s difficult to find the time to come to the stores. The virtual store and the nice presentation of the right brands are very significant factors in their desire to buy. Optimally it’s just as lovely an experience to visit the store online as it is to visit the physical store. Otherwise they’ll find stores both in Denmark and abroad.
Women in their 30s float through the stores in shopping streets and malls in their lunch breaks, so the physical store also needs to be attractive to them. Suddenly they find the 10 minutes to look at the watch or jewelry that they might want for their birthday or Christmas.
Time, space and energy
We work more and more and many of us have spare time filled with activities, be it domestic tasks, sports or other leisure activities. Our time is besieged with appointments, meetings and commitments, which we either make ourselves or others such as employers, children and parents make for us. Adults have lost 2 hours of free time over the past 20 years – families with children a little more.
We lack un-devoted time that we can do with as we please and use for relaxation, go shopping and go to restaurants. Many young people also feel this rush and large amount of planned activities. They yearn to log out and gather their strength for a busy life with many challenges.
The flexible workplace and leisure time that changes week by week and for some, hour by hour, enhances the feeling of finding it difficult, to find the time to buy that gift for Aunt Olga, as well as new clothes and jewelry for the big party.
This trend means that the retail trade is seeing more competition from e-tail – retail online. Net based sales and delivery will see an even bigger increase over the coming years because of the younger generations, who are often very at home in shopping online for clothing, jewelry, music, books and more.
At the same time, the vacation pattern of more but shorter vacations and trips over the year, mean that the current trend of buying clothes, perfume and jewelry on the trip, at the airport and at the destination will increase. The sales numbers for clothes, shoes and accessories such as jewelry etc. rose in 2007 above the total border-shopping for beer, wine, spirits, candy etc. More and more people shop during and on their way home from their travels and they do so for a number of reasons. Our analysis shows that time, opportunity to find something unique and the energy to shop and find new products are crucial.
The challenge for the store is that it needs to be a special destination in itself and be so unique and different in its décor and products, that it’ll draw customers there. That will however be difficult to attain on their own. Often it’ll be necessary for the store to team up with the other nearby stores in the mall or shopping street and make it especially attractive to go there and shop. It is the attractiveness of the area as well as the individual stores that are critical for the flow of customers in the future. This flow isn’t just people who are off-duty, but also people who are working, but are headed from one place to another during a flexible work-day and who because of this, have the time and opportunity for a planned visit or to shop impulsively.
This is why it’s a strange experience to walk past the Danish shops on a Cultural Night or other Friday-evening event and see closed jewelry shops who are doing their utmost to avoid the impulsive purchases from young people and seniors, who are floating hand in hand through an exciting night in the shopping world. You need to be open when the customers are on the street, if you want to survive the future.
Situationism in consumer behavior
The consumers aren’t buying what they need anymore, but whatever they see, stumble upon or are tempted by. Sometimes you want something and other times something completely different. What we want depends on weekday, mood, who we’re with, tempting items and a competent service. This trend is growing rapidly over the coming years for a number of reasons.
Fremforsk’s analysis and other analyses of consumers, show that the tendency toward situationally determined consumerism is extremely widespread amongst young consumers. They mostly buy because they impulsively felt like it in the situation. Age matters, but still, about half of what women over 50 buy, are things they stumble upon or get an urge to buy, while they’re out shopping.
At the same time, the amount of nomads on the job market is on the rise. The nomad is a person who is always moving around, either locally or internationally, maybe through towns, new cities and airports and combine business deals with private shopping during the day and week. Spending thus happens when the opportunity arises. One moment it’s IT-equipment for work and the next it’s a present for the husband or wife and maybe grocery shopping for dinner the same night.
Transparency – Let the customer see into the shop
Transparency for the customer and in the shop is a tenacious trend that will grow over the coming years. Customers expect that everything is accessible. They want information on the history of the raw materials, emergence, salary and conditions for the people who are part of the production process, values and actions as employer. The customer needs easy access to this information. Even though jewelry is often a product made from multiple sources, the demands for information about the origins of gold and diamonds might become a problem for the industry. What exactly does a diamond mine look like? Do they have their De Beers ethics in order? How good are the conditions for the gold miners in Russia or South Africa?
But that’s not enough. The consumer needs to have the possibility of assessing, evaluating and make suggestions for the product’s shape, functionality, service etc. More and more businesses are blogging with customers, inviting customers to give advice when developing new wares and are in this way building a new type of dialogue and loyalty with the customer. The dialogue has moved from the store and producers’ focus groups to the virtual store and the virtual focus groups online.
Luxury, low supply and consumerism during and after the crisis
The definition of luxury changes and becomes dependent on what we feel we don’t have enough of and want more of. Luxury in the future will be time, intimacy, unwinding, safety and spaces. The art is to add a product onto these needs. Right now we’re not thinking overly much about luxury but are more preoccupied with crisis. You could say it with flowers, but you could also say it with jewelry – intimacy and family values are at the forefront during a crisis, rather than showing off and showcasing your own success.
The signals exhibited by jewelry and watches during the sale are important and needs to be adapted to new times. The last few years of maximalism in regards to the most expensive four-wheelers, the most expensive designer furniture, furs, jewelry and architecturally designed houses are out. Instead we’re choosing the little luxuries in life and preferably luxuries that will make us forget the cold and hard world around us. We want to replace the expensive visit to restaurants with a good meal with family and friends.
For jewelry and watches it means a polarization; either the expensive and unique or the cheap and good. The market in the middle is threatened. Crises are transitions and even though optimism declines for a while, we’ll still be spending money over the coming years and of course in the long run. There will still be parties, confirmations, weddings, funerals, birthdays and other events where jewelry and watches can be given as gifts. The Danes don’t have less money in their hands in 2009 than they did in 2008 – on the contrary they have more. At some point, all the talk of crisis will be too much for the Danes and they’ll realize that they still have plenty of money in their bank accounts.
The store in the future
The traditional perception of a store with a storefront, placement of products, exhibition and shopping area isn’t up to date, not today nor in the future. Both the physical store and the virtual store and the images, services and options they give the customers as a whole, not least that both platforms make the customers want to see, feel and hear more about the products. It’s necessary to move from traditions and into the future. The store needs to be an experience – otherwise you might as well stay home. It’s again retail that needs to draw the consumer into the store. We shouldn’t wait for them to be pushed, with a bulging wallet, into the market by a financial upturn. It might take a while before that situation arises again.
The new store: Meeting customers on their terms
The seniors want good service, personal attention and competent employees. Young people want fun, experiences and a store setup that makes them want to hang out with friends there. Busy moms with small children should be enticed to do a quick stop and want a large, easily accessible selection of wares. Those aren’t easy parameters to cover in a 150m2 store – nor in a 400m2 one.
Luckily there are more similarities. A break that everybody needs. Just look at cafees, which without any problems attract everyone from the very young to senior citizens. The common ground is the opportunity to take a breath and get something to drink or eat. The same thing could be done in a jewelry shop. There needs to be possibility for the young to come in and browse – ie. look for temptations without being serviced. There needs to be the possibility of taking a break and maybe even a cup of luxury coffee. There needs to be quick service for the busy – much like other places where they have express check-outs for these types of customers.
One of the tricks is to make the store a transformable stage. There needs to be a certain act going on those mornings where the seniors flock to the city or mall. Inspire them to buy a good confirmation present or that special Christmas present to the young girl or new mother. The stage is transformed for Friday evening where action hits the shopping streets and malls. Young people are greeted with open doors and a selection of wares put out for display and touch – they want to try things and wear them, preferably without being bothered. Security against theft can be handled easily and invisibly.
There also needs to be a noon scene in the manuscript for the busy mothers passing by. A nice permanent corner for them in the store is also a good solution. And they need to feel welcome. The closed and buttoned-up needs to get kicked out of the store in favor of the invitation to come in.
Events in the evening or Saturdays and Sundays with demonstrations, stories about jewelry and watches and representatives for the individual products also create a diverse store. Invite seniors to an evening about beautiful jewelry for strong women. Do a Saturday on the coolest presents for young people who have just been confirmed – but remember to ask them as well of course. Do a theme on weddings and engagement rings – champagne tastings and wine menus might be arranged with the local winery.
There are many events in people’s lives that are associated with jewelry and watches, so the list is long. Stores need to seize on these situations and inspire people to spend money. Baptism, birthday, first day of school, confirmation, finishing high school, engagement or just transitioning from ‘maybe-significant other’ to real significant other, wedding and the many future wedding days and a number of other events in people’s lives.
In the future, selling and the sale will demand well developed empathy from the employees and owners. It’s all about the appropriate service for the different consumer generations, from the senior who wants an especially personalized service, to the 30 year old woman who’s in a rush and needs to know price and delivery, to the youths. It’s the moment of truth when customers are being serviced – will they buy or will they walk?
At the same time employees also need to be adept at spotting customer’s personalities in stores. Are they there just to browse, to be presented with the newest items or for gift shopping for themselves or others? A significant trend in the future is the involvement of the consumer in the creation of the product. Guerlain-perfumes have developed a concept where the customer, with some guidance, mixes their own unique perfume in the store.
Create your own jewelry is a challenge for the jewelry industry. Most probably won’t have the talent to do it from scratch, but with a suitable number of basic models, they might be able to create variations of a basic template. In that case the wedding rings could be unique, the earrings could match the watch and the pendant wouldn’t be owned by anyone else. You could translate that special feature of the family heirloom into new products.
Cooperation – The art of lifting together
In the future it won’t be possible to survive on your own. Each store has to work together with other stores in the area to make the area attractive for customers. When spending is situational it’s all about luring in customers in bulk – they won’t know what they’re buying before they arrive. Therefore participation in everything that the local community is doing is also imperative for the survival of the jewelry shop.
Published here 2017
Head of Research