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Jewellery Retailing - UK - September 2015

Jewellery Retailing - UK - September 2015

“The jewellery retail market follows a strong year in 2014 when falling precious metal prices and economic improvements boosted spending in the market. Young women stand out as being the biggest purchasers of jewellery for themselves, driven by their appetite for branded jewellery and the trend for layering and stacking multiple items together. Going forward, men’s jewellery will be a key area of growth.”

– Alice Goody, Retail Executive

This report answers the following key questions:

What is driving growth in the jewellery market?
How are jewellery retailers performing on the high street?
What would encourage more jewellery purchasing?


OVERVIEW
What you need to know
Products covered in this report
EXECUTIVE SUMMARY
Figure 1: Best- and worst-case forecast value sales of jewellery, 2010-20
Companies, brands and innovation
Figure 2: Attitudes towards and usage of selected brands, December 2014 and June 2015
Figure 3: Leading jewellery specialists’ compound annual growth rate (CAGR) in net revenues, 2010-13*
The consumer
Figure 4: Jewellery types purchased in the last five years and/or being considered for purchase in the next six months, June 2015\
Figure 5: Retailers used for purchasing precious metal jewellery, either in-store or online, June 2015
Figure 6: Retailers used for purchasing costume jewellery, either in-store or online, June 2015
Figure 7: Consumer attitudes towards purchasing jewellery, June 2015
Figure 8: Factors influencing precious metal jewellery purchases, June 2015
Figure 9: Occasions that jewellery is bought as a gift, June 2015
What we think
ISSUES & INSIGHTS
What is driving growth in the jewellery market?
How are jewellery retailers performing on the high street?
What would encourage more jewellery purchasing?
THE MARKET
What you need to know
Jewellery market grows by 1.2% in 2015
Jewellery sales to reach £4.5 billion by 2020
Falling precious metal prices correlate with rise in hallmarking
Consumer confidence beginning to rise
Consumers buy costume jewellery more regularly than precious metal
Increase in 25-34s could boost the precious metal jewellery market
Watches market estimated to grow by 4.5% in 2015
The market
Jewellery market grows 1.2% in 2015
Figure 10: UK value sales of jewellery, 2010-20
Figure 11: UK value sales of jewellery by segment, 2011-15
Jewellery sales to reach £4.5 billion by 2020
Figure 12: Best- and worst-case forecast value sales of jewellery, 2010-20
Market drivers
Falling precious metal prices boost the jewellery market
Figure 13: Average yearly prices of gold, platinum and palladium, in dollars, 2000-15
Figure 14: Average yearly prices of silver, in dollars 2000-15
Hallmarking continues to grow, but at a slower rate than 2014
Figure 15: Number of gold and silver items hallmarked, 2006-15
Rising consumer confidence drives luxury spend
Increase in 25-34s could boost the precious metal jewellery market
Marriages rise by 5.3%
Consumers buying more costume jewellery than handbags
Figure 16: Spending habits for clothing, footwear and accessories, May 2014 and June 2015
Watches market estimated to grow by 4.5% in 2015
KEY PLAYERS
What you need to know
Argos launches bespoke diamond jewellery service
Fast-growing brand taps into the charm bracelet trend
Pandora is associated with fun and vibrant traits
Michael Kors suffers a lack of awareness
Swarovski ramps up advertising to tap into rise in self-purchasing
Department stores invest in their jewellery offering
Costume jewellery retailers suffer falling sales
28
Launch activity and innovations
3D-printed jewellery is brought to the high street
Figure 17: 3D-printed jewellery from Zazzy
Argos launches bespoke diamond jewellery service
Figure 18: Argos’ Exclusively Yours bespoke jewellery service
Wearable technology adds function to fashion
Ethically sourced diamonds are brought to the UK market
Discount jewellery chain launch caters for price-driven consumers
Costume jewellery marketplace is given an ethical stance
Fast-growing brand taps into the charm bracelet trend
Figure 19: A leather charm bracelet Endless’ autumn/winter 2015 collection
Tiffany brings New York to London’s Selfridges
Jewellery delivered straight to your door
Figure 20: A Wifty subscription box
Brand research
What you need to know
Brand map
Figure 21: Attitudes towards and usage of selected brands, December 2014 and June 2015
Key brand metrics
Figure 22: Key metrics for selected brands, December 2014 and June 2015
Figure 23: Attitudes, by brand, December 2014 and June 2015
Figure 24: Brand personality – Macro image, December 2014 and June 2015
Figure 25: Brand personality – Micro image, December 2014 and June 2015
Brand analysis
Figure 26: User profile of Pandora, June 2015
Figure 27: User profile of Michael Kors, December 2014
Figure 28: User profile of Swarovski, June 2015
Figure 29: User profile of Tiffany & Co, June 2015
Figure 30: User profile Links of London, June 2015
Brand communication and promotion
15.6% uplift in advertising expenditure
Figure 31: Recorded above-the-line, online display and direct mail total advertising expenditure on jewellery, 2011-14
Advertising peaks over the festive period
Figure 32: Recorded above-the-line, online display and direct mail total advertising expenditure on jewellery, by month, 2014
H Samuel overtakes Pandora as biggest spender
Figure 33: Recorded above-the-line, online display and direct mail total advertising expenditure on jewellery, by advertiser, 2011-14
Press adverts account for 60% of spend
Figure 34: Recorded above-the-line, online display and direct mail total advertising expenditure on jewellery, by media type, 2014
Figure 35: Recorded above-the-line, online display and direct mail total advertising expenditure on jewellery, by media type, 2011-14
A note on adspend
Companies and products
Leading specialists: Compound annual growth rates
Figure 36: Visual merchandising in a Pandora concept store, encouraging multiple purchases of stacking rings
Figure 37: Leading jewellery specialists’ compound annual growth rate (CAGR) in net revenues, 2010-13*
Leading specialists: Revenues
Figure 38: The Lola and Grace stand within Swarovski’s Oxford Street store
Figure 39: Leading jewellery specialists’ revenues, 2010-14
Leading specialists: Outlet numbers
Figure 40: Leading jewellery specialists’ outlet numbers, 2010-14
Leading specialists: Sales per outlet
Figure 41: Leading jewellery specialists’ sales per outlet, 2013
Department stores
Independent jewellers
Figure 42: A ring from Mococo’s own-brand Kiss collection, tapping into the trend for rose-gold and mixed metals
Costume jewellery retailers
Figure 43: Accessorize’s Z collection, featuring gold-plated and sterling silver items of jewellery
Fashion stores and mixed goods retailers
Figure 44: A necklace from Topshop’s gold plated jewellery collection
Figure 45: Topman’s ‘Create your own necklace’ range
THE CONSUMER
What you need to know
Young women drive self-purchasing activity
Young men buying precious metal jewellery for themselves
Costume jewellery is a popular gifting option
Argos is the retailer of choice for precious metal jewellery
The inability to try on jewellery may be holding back online purchases
Value for money and metal type are the most important qualities to jewellery buyers
More consumers buy jewellery for Mother’s Day than Valentine’s
Purchasing of jewellery
Silver is the most purchased metal type
Figure 46: Jewellery types purchased in the last five years and/or being considered for purchase in the next six months, June 2015
Precious metal jewellery associated with higher-income households
Costume jewellery is more popular than gold
Figure 47: Jewellery types purchased in the last five years and/or being considered for purchase in the next six months, June 2015
Women buying more precious metal jewellery for themselves
Figure 48: Purchasing of precious metal and costume jewellery – Women, by age, June 2015
Young men buying precious metal jewellery for themselves
Figure 49: Purchasing of precious metal and costume jewellery – Men, by age, June 2015
Young women favour silver; gold appeals to 45-64s
Figure 50: Purchasing of silver jewellery – Women, by age, June 2015
Figure 51: Purchasing of gold jewellery – Women, by age, June 2015
Men’s jewellery purchasing for someone else peaks among 25-34s
Figure 52: Purchasing of any precious metal jewellery – Men, by age, June 2015
Where jewellery is purchased
Consumers choose Argos for precious metal jewellery
Figure 53: Retailers used for purchasing precious metal jewellery, either in-store or online, June 2015
Profile of precious metal jewellery shoppers
Figure 54: Profile of precious metal jewellery shoppers, by age and affluence, June 2015
Fashion stores dominate for costume jewellery
Figure 55: Retailers used for purchasing costume jewellery, either in-store or online, June 2015
Figure 56: Costume jewellery from the Freedom by Topshop range
Profile of costume jewellery shoppers
Figure 57: Profile of costume jewellery shoppers, by age and affluence, June 2015
Loyalty among jewellery shoppers
Figure 58: Repertoire of retailers from which precious metal jewellery is purchased, either in-store or online, June 2015
Figure 59: Repertoire of retailers from which costume jewellery is purchased, either in-store or online, June 2015
A third of precious metal jewellery buyers have bought online
Figure 60: Online purchases of jewellery, by gender, June 2015
Attitudes towards purchasing jewellery
Figure 61: Consumer attitudes towards purchasing jewellery, June 2015
Choosing jewellery for others is tricky
Figure 62: Gender and age breakdown of consumers who find it tricky to choose jewellery for someone else, June 2015
Multi-wear jewellery taps into consumer desire for customisation
Little interest in additional services such as manicures
Over one in 10 want a relaxation area
Profile of precious metal jewellery shoppers
Figure 63: Profile of precious metal jewellery shoppers and their attitudes towards buying jewellery, by age and affluence, June 2015
Precious metal jewellery buyers are promotionally driven
Figure 64: Gender and age breakdown of consumers who are more likely to buy jewellery that is on promotion, June 2015
Trying on jewellery remains integral to the purchase process
Figure 65: Pandora’s touch-and-feel ring unit encourages trying on in store
Young women are significantly more brand-driven
Figure 66: Breakdown of those who like to buy branded precious metal jewellery, by gender and age, June 2015
Consumers want reassurance on where metals are sourced from
Costume jewellery is bought with an outfit in mind
Figure 67: Women’s attitudes towards buying costume jewellery, by age, June 2015
Factors affecting the purchase of precious metal jewellery
Value for money overrides metal type
Figure 68: Factors influencing precious metal jewellery purchases, June 2015
Profile of jewellery shoppers based on the qualities they look for
Figure 69: Profile of precious metal jewellery shoppers and the factors that are most important to them, by age and affluence,
June 2015
The young are less concerned with hallmarking
A unique design is more important than being on-trend
The brand and designer are not as vital as other design aspects
Platinum jewellery buyers the most concerned with ethical sourcing
Personalisation important to Millennials
Gifting occasions for jewellery
Costume jewellery is a popular gifting option
Figure 70: Occasions for which jewellery is bought as a gift, June 2015
Birthdays are the biggest gifting occasion
Men drive spend for anniversaries and weddings
Figure 71: Most popular gifting occasions – Men, June 2015
Young women drive spend for Mother’s Day
Figure 72: Most popular gifting occasions – Women, June 2015
Repertoire of gifting occasions jewellery has been bought for
Figure 73: Repertoire of gifting occasions that precious metal jewellery has been bought for, May 2015
Figure 74: Repertoire of gifting occasions that costume jewellery has been bought for, May 2015
APPENDIX
Data sources and abbreviations
Data sources
Fan chart forecast
Abbreviations
RESEARCH METHODOLOGY
UK Research Methodology
Sampling and weighting
Face to Face Surveys
Definitions
Brand & Social Media Research
Trade research
Desk research
Statistical Forecasting
The Mintel fan chart

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