There are three categories of jewelers. A jeweler is either Brick & Mortar (B&M–has a physical store front); Virtual (internet based– no physical store front) or combo B&M & Virtual. I am not including TV vendors for this article because they only deal in commercial quality and costume jewelry.
Within all three categories of jewelers there are four distinct approaches used in selling based on four customer types: the Discounter, the Bargain Shopper, the Brander, and the Better Thans.
A. The Discounter: The discount shopper isn’t particularly interested that an item is top of the line as long as their particular need gets satisfied. They focus on "category needs" not "detailed needs." A discounter buys a car to get from point A to B, not because of how sexy they will look in it or what their neighbors will think. A discounter buys toilet paper, cars, bikes, trucks, & TVs. The rest of us buy Charmin, Lexus, Harley, Ford, and Sony. The Discounters’ motto is "Get the job done at the lowest possible price." These are the people that will be in line at 2:00a.m. outside Best Buy in the frigid cold on Black Friday (day after Thanksgiving) in order to get something for as close to nothing as possible.B. Bargain Shopper: Wal-Mart has proven that most of us are bargain shoppers; quality merchandise at a low price. Unlike the discounter mentality, the bargainer isn’t willing to waste the time and effort that it takes to buy at the absolutely, positively, guaranteed lowest price. They want quality merchandise (generally name brand) but at a savings. Bargainers love to compare notes with other bargainers about what a great deal they got on their new Sony DVD or flat screen. Bargainers will make the effort to visit a few stores until they are reasonably sure they’ve done well and quit shopping. Whereas the Discounters will only tend to stop shopping when they’ve been to every store in their area. Of course with the internet it’s taking longer & longer to "shop around."C. The Brander: Like the Bargain shopper, the Brander wants quality but he’s also looking for an emotional connection with the brand. Something that represents him or her. Something that tells the world who they are. Price is less important to Branders than actually having the item that other people have so they can connect with them. That’s why celebrity endorsements work so successfully. If an individual sees a celebrity endorse a product, or better yet actually use the product, they form a bond with the product. "Let’s see, Robert DiNiro uses the American Express card. If I have an American Express card, then Robert and I have something in common! We’re connected in some cool cosmic way!" Branders want to buy products that other groups tend to buy. These groups are not limited to but include women, men, the wealthy, the affluent, the sexy, the smart, etc. A Brander may not even "need" a product but purchases it anyway because others in their identity group have the same item.D. The Better Thans: As the title insinuates, the Better Thans honestly believe that on some social, economic, intellectual level they are "better than" others. There’s the right religion, the right political party, the right everything. Naturally, for them to be right, many have to be wrong or "less than." Better Than shoppers only want products that the masses can’t have and if the masses get it, then they don’t want it. Yesterday, I was shopping with my wife and we wandered into Cartier. They had a pink diamond, yellow diamond, & white diamond, tight knit pave, rolling ring that I could produce for about 5K. They were selling it for $52,000! And you know what? They are selling them!? And the reason they are selling them is that they are so expensive. It isn’t enough to just own jewelry any more. The consolidators like Costco, Sam’s, Wal-Mart, J.C. Penny’s, & Blue Nile burst that bubble. People are hung up on where they bought it; when they bought it (the right season); and what they spent. Louis Vuitton has made a fortune as a mega successful brand name because of recognition of their line. When people see someone with one of their hand-bags, every one immediately knows, "Wow! That hand-bag cost major $$$! They must be somebody!" (P.S. Last time I checked, we were all somebodies.) Louis Vuitton even has a new spring & winter line that is only available to their top clients (clients that have spent over 100K with them) that nobody else can buy during that season! In some cases they will only release ten of a type of hand-bag and let the socialites and celebrities duke it out for the power purse. I’ve been accused many times of being a "better than" because of some choices I made. My Patek Phillipe or Rolex watch is a popular "Better Than" selection. My problem is that in most cases there seems to be a direct correlation between quality (which is important to me) & the "Better Than" brands. But I’m also the same guy who was at Target this weekend to stock up on toilet paper. Grocery store prices are too high. To Better Thans, the importance price plays in the buying decision is that it has to be priced high enough that most people can’t afford it.
Now that I’ve described the four customer mind sets, let me outline how the jewelry industry attacks each to get your hard-earned dollar. They know there are many different avenues you can take to buy a piece of jewelry. You can visit a jewelry store that specializes in selling jewelry. This of course could be a mom & pop store or a national jewelry chain. You can visit a department store that has a jewelry department or even a "superstore" like Wal-Mart where you can buy a new pair of jeans, a gallon of milk, and a new engagement ring at the same time! There are high end jewelry stores like Graff, Van Cleef & Arpels, Cartier, Harry Winston (also referred to as guild jewelers); and of course you can surf the web. If we set aside Wal-Mart, the top three companies that sell jewelry in the United States are Zales, Sterling, & Finlay. Together they are responsible for almost 5 billion dollars worth of sales annually out of their 4,375 stores nationwide. In a survey of young, upwardly mobile, professional couples, 93.7% told me they would never consider purchasing a major piece of jewelry from a mall jeweler. When I pointed out that there were some pretty high end stores like Harry Winston and Cartier that happened to be in malls they commented by a ratio of 4 to 1 that they would not shop at Harry Winston or Cartier either, because you were just paying for a name. When I asked about companies like Bailey, Banks & Biddle; Mappins; Friedlanders; Marks & Morgan; Osterman; Jared the Galleria of Fine Jewelry, the usual response was "Well, yeah sure; someone in-between the high enders & the discounters like Kay’s; J.B. Robinson; Zales; Gordon’s, and such." When I asked what was wrong with Kay’s or Zales, the general response from these college educated affluent young men & ladies was they were for people who need to buy in installments; the salespeople weren’t perceived as knowledgeable; and the décor was, well, in a word, "déclassé."
So it seems people tend to shop where they believe they fit in. Kinda like Goldielocks, the choice has to be just right. However, though people believe they are being given a choice of where to shop, in reality, the deck has been stacked. What the big jewelry retailers did decades ago was buy up most of the mom & pop jewelers. These are the same jewelers that spent decades building a loyal clientele and then were bought up by the big corporations, leaving, of course, the original owners name on the awning so you, the loyal clientele, wouldn’t be the wiser. For the first time I’m listing for all to see the true owners of the jewelry stores you frequent; so you know exactly who is getting your money.
|Zales Corp.||Store names|
|901 W. Walnut Hill Lane||Zales Jewelers||Zales Outlet|
|Irving, TX 75038||Gordon’s Jewelers||Piercing Pagoda|
|fax: 972-580-5336||Peoples Jewelers|
|Sterling Jewelers||Store names|
|375 Ghent Road||Belden Jewelers||J.B. Robinson|
|Akron, OH 44333||Friedlander’s Jewelers||LeRoy’s Jewelers|
|330-668-5000||Goodman Jewelers||Osterman Jewelers|
|fax: 330-668-5191||Roger’s Jewelers||Shaw’s Jewelers|
|US subsidiary of Signet Group (U.K.)||Weisfield Jewelers||Kay Jewelers|
Marks & Morgan Jewelers
|Jared the Galleria of Jewelry|
|Finlay Fine Jewelry Corp.||Store and Department store locations|
|(largest leased store operator)||P.A. Bergner||Burdines|
|521 Fifth Ave.||Bloomingdales||Dillard’s|
|New York, NY 10175||Elder-Beerman||Famous Barr|
|212-551-8300||Bon Ton||Bailey, Banks, & Biddle|
|fax: 212-867-3326||Boston Store||Shaw’s Jewelers|
|Subsidiary of Finlay Enterprises Inc.||Carson, Pirie, Scott||Macy’s|
|Goldsmith’s||Lord & Taylor|
|Carlyle & Co.|