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January/February 2006

The Top and Bottom are Good But It’s Slow in the Middle

All in all, it was a good but not great holiday season — certainly not a disaster, by any means, but not really outstanding. Still, this is better than some predicted, with all the problems with gasoline price hikes.

The bottom of the market seemed to sell very well. The top of the market also sold; there is even a shortage of certain large diamonds. The Diamond Registry was fortunate to make a couple of big stone sales, which brought our annual sales up.

But sales in the middle of the market were certainly quieter than we expected, and certainly softer than last year.

The results from the big sellers was basically mixed. Zale and Finlay had mediocre, flat sales. But Tiffany, Sterling and Mayor’s were all up.

The bottom of the market seemed to sell very well.

According to Pam Danziger, president of Unity Marketing: “The Christmas holiday shopping season of 2005 will go down as one of the more lackluster in recent years. Shoppers simply didn’t have an excess of holiday cheer, which moderated their gift spending.”

We didn’t find things that bad, but we tend to agree with a press release from the Jewelry Consumer Opinion Council that said that consumers favored

low price point items this past holiday season, and that there were not any large sales gains.

The JCOC also found that price and convenience were important factors for holiday purchases – particularly price. More than half (56.7 percent) of jewelry purchasers this holiday season spent less than $200 on their jewelry and watch gifts.

The JCOC found that consumer preferences this holiday season were gold, diamond jewelry, precious metal jewelry with no gemstones, earrings, necklaces and watches. 32.5 percent chose diamond jewelry for their holiday purchases.

Of the panel members, 35.4 percent spent more on fine jewelry and watch gifts compared with previous years, while 32.4 percent spent less. Among those who spent less, 30.1 percent said that jewelry was not in their budget, while 16.6 percent said they wanted to buy something different.

The JCOC also found missed opportunities for the industry. Less than 20 percent of respondents said they purchased fine jewelry for themselves this past holiday. However, back in September, more than 40 percent indicated that they would make a self-purchase. The JCOC concluded that desirable products were not available for self-purchasers and that retailers need to be sure to include self-purchases in their sales efforts during the holiday.

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