Diamonds, Jewelry Sell Well Online Despite Website Closings-Dec.2000
While Jewelry and Diamond e-tailers may be facing a shakedown—with
companies like Miadora and Adornis shutting their virtual doors
to business in recent months—overall online retailing is continuing to grow, according
to a recent survey. Ninety-six percent of last year’s holiday online shoppers intend to purchase
gifts online again this year, according to a Boston Consulting Group and
Harris Interactive poll.
"The vast majority of last year’s online holiday shoppers said they are
willing to give it another go. and they are also willing to spend more this
time around," said Michael Silverstein, BCG senior vice president and
leader of the consulting firm’s Consumer Practice. "Many consumers aren’t,
however, prepared to go back to sites where they experienced purchase
failure... they will go to different online retailers."While online retail is growing, brick-and-mortar jewelers should keep in
mind that it is not a significant threat to traditional retail this season.
There is less funding for such online portals—witness the demise of Adornis
and Miadora—making marketing and advertising more difficult. This also
creates an increased need for profitability, which drives up retail prices
online. Finally, online purchases remain much lower than average jewelry
prices. For example, according to the survey, last year, the average online
shopper spent $170 on holiday gifts. This year, those same consumers expect to
spend $240. The entire sum of online sales this holiday will amount to only
about 1.5% of overall retail sales.
In a reversal of last year's holiday shopping trend, however, consumers are
moving toward online retailers with a brick-and-mortar presence this season,
according to a Jupiter Media report.
According to the Industry Standard, analysts predict that
already-established brands—like Tiffany.com—will be the ones to
succeed in the race to sell diamonds and jewelry online.
According to a study by Forrester Research, quoted recently in the
Industry Standard, jewelry customers are prime for online sales:
Millionaires spend twice as much money as the rest of the online population
and are more likely to believe that a better brand means higher quality.
About 45 million online buyers will spend about $12.5 million this season,
according to eMarketer.v