ColumnistsAug 02, 2022
Why Passing on Lab-Grown Diamonds Might Be a Risky BetColumnistsAug 10, 2022
On Data: What We Know About Jewelry Sales So Far This Year
Sherry Smith digs into year-to-date data on lab-grown vs. natural diamonds, the performance of colored gemstone jewelry, and more.
Sherry Smith is director of business development for data and consulting company The Edge Retail Academy. She can be reached at sherry@edgeretailacademy.com.
In a recent note cited in this Bloomberg article, economists Yelena Shulyatyeva and Andrew Husby wrote: “The June retail sales data implies there’s still enough momentum for the U.S. economy to grow during the rest of the year as consumers find ways to cope with surging inflation, whether by dipping into savings or switching jobs.”
So, what does our data show about sales momentum in jewelry? Let’s take a look at the numbers and see.
Year-to-date numbers for January through July show independent jewelers up 5.8 percent in gross sales when compared with the same period in 2021.
It is worth considering the extent to which increasing prices accounted for that growth, especially in light of year-to-date unit performance.
Number of units sold is down 4.5 percent, while the average retail sale has climbed 10.7 percent.
Overall gross margin continues to increase year-over-year, driving a strong increase of 8.1 percent in gross profit dollars. The better margins retailers make on lab-grown diamonds might be a factor in that increase.
Now, let’s break it down by category, starting with diamonds.
In July, gross sales of loose diamonds (natural and lab-grown) declined a whopping 22 percent while units sold dropped 20 percent. The average retail sale was down as well.
It may be premature to signal a shift from natural to lab-grown, but the data comparisons bear watching.
Related stories will be right here …
So, what does our data show about sales momentum in jewelry? Let’s take a look at the numbers and see.
Year-to-date numbers for January through July show independent jewelers up 5.8 percent in gross sales when compared with the same period in 2021.
It is worth considering the extent to which increasing prices accounted for that growth, especially in light of year-to-date unit performance.
Number of units sold is down 4.5 percent, while the average retail sale has climbed 10.7 percent.
Overall gross margin continues to increase year-over-year, driving a strong increase of 8.1 percent in gross profit dollars. The better margins retailers make on lab-grown diamonds might be a factor in that increase.
Now, let’s break it down by category, starting with diamonds.
In July, gross sales of loose diamonds (natural and lab-grown) declined a whopping 22 percent while units sold dropped 20 percent. The average retail sale was down as well.
It may be premature to signal a shift from natural to lab-grown, but the data comparisons bear watching.
Diamond semi-mounts and diamond engagement rings also saw a decline in gross sales in July, 18 percent and 16 percent, respectively, likely reflecting a decrease in foot traffic into stores.
With respect to lab-grown diamonds specifically, our year-to-date data (January through June; data on lab-grown for July was not yet available) shows lab-grown loose is now 7 percent of total retail loose sales, an increase from 5.3 percent over the same period in 2021.
Lab-grown loose increased 46 percent in gross sales when compared with the same year-to-date period in 2021 and units sold grew 42 percent despite the likelihood of more challenging foot traffic into stores.
We’ve heard lots of questions about the average retail sale of lab-grown loose diamonds. Our year-to-date data (again, through June) of the independent channel shows the overall average retail sale grew by 6 percent.
When we delve into the data, it shows there were decreases in average retail sale in many sizes. However, larger lab-grown diamonds showed significant increases in most of the key performance indicators.
The 3.25- to 3.50-carat range showed a 194 percent increase in gross sales, a 114 percent increase in units sold, and a 25 percent increase in average retail sale, suggesting some customers might be trading up in size from smaller natural diamonds.
The 4.5- to 5-carat range recorded a spike of 582 percent in gross sales, 414 percent in units sold, and 33 percent in average retail sale, and the 5.5- to 6-carat range showed a 78 percent increase in gross sales, a 67 percent increase in units sold, and a 7 percent increase in average retail sale.
The data for lab-grown diamonds 6 carats and above show increase in gross sales and units sold as well as in the average retail sale.
I should also note that smaller lab-grown loose (under 0.60 carats) also grew in average retail sale.
It was the 0.60-carat to 3.25-carat range that showed decreases in the average retail sale, with declines ranging from 5 percent to 21 percent.
As sales for lab-grown loose continue to grow, so do inventory levels, which show a 109 percent increase in cost and a 79 percent increase in units in our year-to-date data.
Overall gross margin for lab-grown loose comes in at a very healthy 62 percent, up from 60 in the previous year-to-date data.
Editors' Picks
Sponsored by
Now I’ll move on to color.
Although colored stone and pearl jewelry only make up about 8 percent of annual jewelry sales, a few categories showed slight increases this July.
Colored stone necklaces showed a 7 percent increase in gross sales and a 20 percent increase in average retail sale but an 11 percent decline in units sold, likely reflecting the aforementioned decrease in foot traffic into retail stores.
Colored stone pendants showed a 4.1 percent increase in gross sales and a 24 percent increase in average retail sale but, again, a 16 percent decline in units sold.
Pearl bracelets showed a 21 percent increase in gross sales, a 22 percent increase in average retail sale, and were flat in units sold.
Watches showed a 1.7 percent increase in gross sales and a 19 percent increase in average retail sale but a double-digit decline in units sold at 14 percent.
Precious metal jewelry without stones declined 7 percent in gross sales and 12 percent in units sold but increased 6 percent in average retail sale.
Precious metal bracelets were the one standout, recording an 11 percent increase in gross sales, a 13 percent increase in average retail sale, and only a slight decline of 1.3 percent in units sold.
All told, growth in overall sales reflects a healthy sales environment for retailers, although a decline in unit sales might signal a marked decline in foot traffic. In addition, year-to-date growth might have some price increases built in, so that is worth watching as prices stabilize.
Gross margin improvements might reflect retailers taking some extra profit on older owned inventory, as well as increased sales of lab-grown diamonds, as mentioned above.
The performance of natural diamonds and semi-mounts may reflect the assumed declines in foot traffic and the continued momentum of lab-grown diamond sales, which showed strength in larger sizes and stones under 0.60 carats.
Although colored stone and pearl jewelry only make up about 8 percent of annual jewelry sales, a few categories showed slight increases this July.
Colored stone necklaces showed a 7 percent increase in gross sales and a 20 percent increase in average retail sale but an 11 percent decline in units sold, likely reflecting the aforementioned decrease in foot traffic into retail stores.
Colored stone pendants showed a 4.1 percent increase in gross sales and a 24 percent increase in average retail sale but, again, a 16 percent decline in units sold.
Pearl bracelets showed a 21 percent increase in gross sales, a 22 percent increase in average retail sale, and were flat in units sold.
Watches showed a 1.7 percent increase in gross sales and a 19 percent increase in average retail sale but a double-digit decline in units sold at 14 percent.
Precious metal jewelry without stones declined 7 percent in gross sales and 12 percent in units sold but increased 6 percent in average retail sale.
Precious metal bracelets were the one standout, recording an 11 percent increase in gross sales, a 13 percent increase in average retail sale, and only a slight decline of 1.3 percent in units sold.
All told, growth in overall sales reflects a healthy sales environment for retailers, although a decline in unit sales might signal a marked decline in foot traffic. In addition, year-to-date growth might have some price increases built in, so that is worth watching as prices stabilize.
Gross margin improvements might reflect retailers taking some extra profit on older owned inventory, as well as increased sales of lab-grown diamonds, as mentioned above.
The performance of natural diamonds and semi-mounts may reflect the assumed declines in foot traffic and the continued momentum of lab-grown diamond sales, which showed strength in larger sizes and stones under 0.60 carats.
More on Columnists
The Latest
CrimeApr 24, 2024
Jewelry Crime Declines Significantly, But Dollar Losses Remain High A double-digit drop in the number of in-store crimes was offset by a jump in off-premises attacks, JSA’s 2023 crime report shows.
CollectionsApr 24, 2024
Pippa Small Announces ‘Venus’ CollectionInspired by the Roman goddess of love, the designer looked to the sea for her new collection.
FinancialsApr 24, 2024
Kering’s Jewelry Brands a Bright Spot in Tough Q1The luxury titan posted declining sales, weighed down by Gucci’s poor performance.
Brought to you by
The Blueprint for Success in Scalable, Personalized Jewelry RetailWith Ho Brothers, you can unlock your brand's true potential and offer customers the personalized jewelry experiences they desire.
Events & AwardsApr 24, 2024
JCK Industry Fund Announces 2024 Grant RecipientsThe selected nine organizations have outlined their plans for the funds.
Weekly QuizApr 19, 2024
This Week’s QuizTest your jewelry news knowledge by answering these seven questions.
SourcingApr 24, 2024
Rio Tinto’s Q1 Production Drops Amid Pause to Honor Lost Colleagues The mining company’s Diavik Diamond Mine lost four employees in a plane crash in January.
WatchesApr 24, 2024
These Are Rolex’s New Watches for 2024 The crown introduced a dozen timepieces in Geneva, including a heavy metal version of its deep-sea divers’ watch.
Brought to you by
How Jewelers of America Represents Your BusinessFor over 30 years, JA has advocated for the industry, fought against harmful legislation and backed measures that help jewelry businesses.
IndependentsApr 23, 2024
Hannoush Jewelers Opens New Store in New York Located in the town of Queensbury, it features a dedicated bridal section and a Gabriel & Co. store-in-store.
SourcingApr 23, 2024
Lucapa Sells 3 Diamonds for $10.5M in First Lulo Tender of 2024A 203-carat diamond from the alluvial mine in Angola achieved the highest price.
GradingApr 23, 2024
GIA Has a New Book About William RuserRuser was known for his figural jewelry with freshwater pearls and for his celebrity clientele.
CollectionsApr 22, 2024
Jacquie Aiche’s New Campaign Stars Adam Levine, Behati PrinslooThe “Rebel Heart” campaign embodies rebellion, romance, and sensuality, the brand said.
EditorsApr 22, 2024
The 22 Best Quotes from AGS Conclave 2024 Editor-in-Chief Michelle Graff shares the standout moments from the education sessions she attended in Austin last week.
SourcingApr 22, 2024
Virtual Diamond Boutique Rebrands as ‘VDB’The overhaul includes a new logo and enhanced digital marketplace.
MajorsApr 22, 2024
Signet Raises Nearly $9M for St. Jude Children’s Research HospitalThe money will go toward supporting ongoing research and aftercare programs for childhood cancer survivors.
CollectionsApr 19, 2024
Piece of the Week: Retrouvaí’s Treasure NecklaceA new addition to the “Heirloom” collection, this one-of-a-kind piece features 32 custom-cut gemstones.
CrimeApr 19, 2024
Grand Jury to Hear Case Against Jeweler Charged in Fatal Shove Following IJO ShowLast month in Dallas, David Walton pushed another jeweler, David Ettinger, who later died.
MajorsApr 19, 2024
Unique Designs Acquires China PearlThe move will allow the manufacturing company to offer a more “diverse and comprehensive” range of products.
GradingApr 19, 2024
AGS Ideal Report Now Available in Printed FormFrom now through mid-May, GIA will be offering the reports at a 50 percent discount.
SourcingApr 18, 2024
Diamond Trade Remains Cautious Amid Economic UncertaintyDe Beers’ rough diamond sales were down 18 percent year-over-year in its latest round of sales.
Supplier BulletinApr 18, 2024
Discover History’s Hidden Gems at the Las Vegas Antique Jewelry & Watch ShowSponsored by the Las Vegas Antique Jewelry & Watch Show
WatchesApr 18, 2024
Watch E-tailer Collectability Hires Kelly YochThe Patek Philippe expert will serve as personal curator for the brand-focused company.
WatchesApr 18, 2024
TAG Heuer Opens Its Largest Standalone Boutique at SeaThe 553-square-foot shop is aboard the Carnival Jubilee cruise ship.
Policies & IssuesApr 17, 2024
NDC Prevails in U.K. Case Over Lab-Grown Diamond AdvertisingNDC filed a complaint against Skydiamond for use of phrases like “diamonds made entirely from the sky.”
Events & AwardsApr 17, 2024
And the 2024 Winner of the Shipley Award Is … John Carter received the AGS’s highest honor Tuesday afternoon at Conclave in Austin, Texas.
FinancialsApr 17, 2024
LVMH’s Q1 Jewelry Sales Fall 5%LVMH said the company performed well despite an uncertain geopolitical and economic environment.
MajorsApr 17, 2024
Stuller’s B&D Opens New HeadquartersB&D Sales and Service held a ribbon-cutting event for its new location in Cranston, Rhode Island.
