The Jewellery Boom, Explained

0:07Hello and welcome to The Debrief from the Business of Fashion, where each week we delve into our most popular BOF professional stories with the correspondents who created them. I'm senior correspondent Sheena Butler-Young. And I'm executive editor Brian Baskin. By now you've probably heard about the luxury slump. After years of record sales, wealthy consumers just aren't shopping like they used to. And brands like Gucci and Dior are struggling to drum up interest in their latest collections. We may be months or even years away from a rebound. But there's one category that's still shining amid all the gloom.

0:42Jewelry sales are still growing, and both big conglomerates like Cartier-owned Richemont and indie designers say business has never been better, both commercially and creatively. We're joined today by two BOF correspondents who have been covering this space closely, Simone Stern-Carbonne and Joan Kennedy. Welcome back to the Debrief podcast. Hi, Brian. Hi, Sheena. Happy to be here. Hi, thanks for having us. So, so much of this comes down to consumers feeling like a$5 ,000 ring or a necklace is worth it, but maybe a$5 ,000 handbag is not. Why is that, Simone? Like what's happening right now? Well, what makes an item worth it is subjective, right?

1:22But there are some differences, some very concrete differences between jewelry and let's focus on the leather goods space, particularly handbags. So a$5 ,000 ring or necklace might feel like it's worth it more for different reasons. One, the prices actually haven't increased as much in jewelry as they have with handbags and some other categories, especially in the past five to six years. But we've already seen this in the past decades where leather good brands have really skyrocketed their prices much more than jewelry brands have. So customers are sensitive, especially aspirational luxury customers are very sensitive to those increases.

2:01At the same time, jewelry in most cases has some tangible factors that actually makes it feel luxurious, like gold, diamonds, and other valuable materials that are being used. Leather and certain leathers in particular can be seen as valuable, but there have been a lot of complaints about declining quality, declining craftsmanship. There's been scandals left and right about the way workers at these leather good luxury factories are being treated. And jewelry just hasn't seen the same kind of negative headlines. So it sounds like the big difference here is people always thought a ring or necklace should cost$5 ,000.

2:41I don't know why we keep coming back to that number, but, you know, that didn't seem unusual a few years ago. But the idea of a run-of-the-mill luxury handbag costing that much still feels a little strange to people. They're still kind of adjusting to that idea. Yeah, I think so. So I mean, ask around, you know, among your acquaintances, friends and family, you know, what do they feel like makes more sense to spend multiple thousands of dollars on a handbag or a piece of jewelry? And I think instinctively, a lot of people associate jewelry, especially if it's gold, gemstones, diamonds, with something that you would dish out more money for more happily and readily than for a handbag potentially made out of nylon or out of vegan leather.

3:20You know, none of these things are inherently valuable or luxurious. So there definitely is that psychological difference. And then also jewelry traditionally was seen as something that was purchased for very special occasions. But I think we'll get into that a little bit later. Jewelry is becoming more of an everyday purchase for luxury consumers. So that's an interesting dynamic that's changing, too. But yes, we still associate it with something more special. So, Joan, you recently looked at the pull that luxury, novelty and kitsch jewelry has, which a lot of that is related to the cultural and emotional signals that it can send to people.

3:55That's a big part of the conversation. Can you talk a little bit about that? Jewelry purchases have always been driven by emotion and this kind of turn towards more playful things, kind of signals that that's just like really amped up right now. You know, we talked about like luxury's value proposition has weakened a little bit. And shoppers are looking for things that make them feel something. So these more modern takes on jewelry just feel relevant to a new generation, whether it's like a modern take on how to mount a diamond within like a funky pencil bracelet or a like animal charm. They're looking for things that just like spark emotion.

4:40That's so interesting because that feels the complete opposite of what's happening in fashion, where it's all minimalism and quiet luxury. And I mean, why is that? Why do people want novelty in jewelry when they don't seem to want it anymore in the rest of what they're wearing? I think two things. Number one, it's kind of reactive to that trend of like, OK, like you're wearing something like pretty basic. You're leaning into things that are like kind of like uniform dressing. So how do we like spice that up, add a little bit of personality? Let's go for more novelty and jewelry. And like that is where kind of the style comes into play.

5:19And then another element is like obviously like quiet luxury, this kind of like uniform tempered dressing has been like a big theme over the past couple of years. But more recently, we've seen people kind of lean more into like, OK, how do I like develop my personal style? How do I inject that into how I dress? and jewelry there's a lot of experimentation in play right now and so it feels like there's like an availability of these things and they feel new and also then the other element as Simone touched on it feels more worth it like I think it's interesting because post-covid was when this really started when people were like looking for a pick-me-up and I think we saw like this really get heat at first on like the more accessible end like people were buying camp jewelry but they're like paying like$50 for like a funky, colorful ring.

6:11And then it's more recently like that people are like, okay, let's bring in the value piece of this. I'd love it if you both could describe some of the pieces that we're talking about here. Maybe Joan, you can start with the more novelty end. And then Simone, I'd love to hear about some of the emerging designers you've written about who are really seeing a lot of traction with these new jewelry consumers. Definitely. Yeah. So I mean, One of the designers that I focused on was Nadine Gozen, and she is an independent designer. She kind of like started making a name for herself, putting out this burger ring, which is a stackable burger ring.

6:48Meaning a literal hamburger, right? Literally a hamburger, bun, lettuce, tomatoes, burger. She even came out with a veggie version recently, I think. but it's this really like funky childish kind of like mundane novelty piece but made in really really fine materials and so like there's that end of the spectrum and um then at the other side I had noticed that a lot of designers were putting out like more like fruit collections and this is another thing that we saw more on the accessible end but then I got an email or a couple emails one day I think there were like two in a row of fine jewelers releasing these like really really expensive and beautiful fruit salad collections that are like marketed in a funky way, but it's like a lemon pendant, rather yellow diamond lemon pendant or raspberries with rubies, pears with emeralds.

7:43And we should note here that the price point is quite remarkable. The hamburger ring I was looking just now,$23 ,680. I'll note the veggie burger ring actually costs$200 more. So it's a little like 11 Madison Park. You don't get a discount just because they remove the meat from the menu. Yeah. In the fruit salad collection that I was referencing, the polished emerald pearl and diamond piece is priced upon request. And like a lot of the pieces are upwards of$10 ,000. That's the most terrifying phrase. Price upon request is a good sign that it's going to be not available at your local farmer's market, that pairing.

8:21Simone, you talked to some of these, we can call them novelty jewelry creators, but also some who are maybe creating more conventional pieces, but with unconventional materials or other choice. Tell us about that. Speaking of high price points, so one of the jewelers I spoke to, her name is Ana Koury. She's a Brazilian jeweler and actually originally a sculptor and artist based in New York now. And none of her items are actually collections and she doesn't have any stores. It's all really high fine jewelry by appointment only. She shows at some very select art shows and the only store you can buy her jewelry at in limited collections of a maximum of 100 pieces per design is at the Rowe boutiques around the world.

9:03Other than that, there's really an array of small jewelry brands that are just popping off and I think that's something that's really exciting at different price points from different geographic locations. There's two from the UK that I'd like to highlight. One is Jessica McCormack. The face of Jessica McCormack is Zoe Kravitz. If you're in New York, you've probably seen her face wearing fabulous diamonds all over as Jessica McCormack just opened a store in New York. She has, I think, two in London already. And she really got known for her diamonds, whether they're in earrings or in engagement rings.

9:37That's really been her strong suit for now. And then we have completed works. They're at a totally different price point. So they use more gold-plated and silver. It's a little bit more affordable, but the designs are really unique. They went viral around the pandemic with what was called the scrunch earring that is basically, it looks like a gold-plated scrunchie. And so many celebrities were seen wearing that really popped off. I think it was a great moment as we were all transitioning to video calls, where people liked having these statement pieces that you could still see because they're in and around your face.

10:11So that was really a good moment there. And they built off that momentum.

10:17We'll be back with more of The Debrief right after this.

10:24So I want to also talk about the fact that some of these independent jewelry designers are thriving right now. Like I did a story three years ago about the lack of diversity or why jewelry as a sector is so difficult to diversify. And it had to do with the fact that it's based on generations and generations of family wealth and like access to diamonds and all these things. But you, in your reporting, you talk to these amazing indie designers that are actually more resilient in this climate. Can you tell us about why and how? So I think it's hard to say that they're more resilient across the board than the giants like Cartier and Van Cleef.

11:00You can't necessarily say that there's pros and cons to being David and Goliath in the jewelry space right now. But I think for the small brands, there are some advantages. One, as we've said before, jewelry is so personal. And when you have a very distinct aesthetic, you really connect with your customers long-term, potentially for life. So there's this really personal relationship that a lot of these smaller brands, they capitalize on. Also, in terms of supply chain, they usually have smaller supply chains. I remember Anna Koury saying, I know every single person in my supply chain. Maybe they have to answer to some private investors, but they don't have to answer to the market.

11:34They're not publicly listed. So they have a little bit more creative freedom. At the same time, the price pressures, gold and actually silver as well are at near all time high right now. So that definitely is a big headwind for jewelry across the board. But if you have a smaller collection, you can potentially pre-purchase these materials at a fixed price earlier in the year. And you don't have to inflate your prices so much throughout the year or take a significant margin hit the way some other brands that purchase more throughout the year at a different level of demand have to do. And I think ultimately the relationship that they can build with their clients, that's really strong.

12:13I think Jessica McCormick has a return customer rate of over 50%. So actually over 50 % of their customers purchase at least one new item a year. And I think that number is just going up and word of mouth and return customers. Those are just really, really strong among these smaller independent brands. Yeah, you got to complete that fruit bowl. You can't have one fruit in the fruit bowl. Definitely. Also, to jump in, I think the personal element is really important. And one of the things that I have found really interesting about this new wave of brands, whether they're leaning more into novelty or not, is that the way that they present their pieces is a lot more like real life and I think can feel relevant for shoppers right now.

12:58You know, like one designer I spoke to puts her charm necklaces next to like candy necklaces. So that feels fun. But like a lot of these designers are doing things that are very like lo-fi. It's like a picture of a wrist on Instagram. And then they reply to DMs about like, hey, show me that bracelet with something else. So the way that they present it is also really relevant to shoppers versus the very high gloss and you can't touch this traditional style of high jewelry. Totally, Joan. And if I can just piggyback off of that, the way it's also marketed, even in more traditional marketing like magazine ads and billboards.

13:38So Jessica McCormick has Zoe Kravitz as the face of the brand, which is a fantastic choice because I think it resonates with so many of the modern jewelry customers. So we have more women buying jewelry for themselves. We also have more men buying jewelry for themselves and men wearing more jewelry. But what does Zoe Kravitz represent? Well, I mean, that's up to interpretation, but she's quite urban in her aesthetics. She has lots of visible tattoos and she'll be stacking rings on her tattooed fingers. And that's something that maybe 15, 20 years ago, we weren't really seeing. We were seeing a much more traditional, demure type of woman in a lot of these ads.

14:17So a lot of these brands are really leaning into the fact that the jewelry space is opening up to more diversity. And I think that's hitting the nail on the head for a lot of customers who identify with that type of vibe. Are we seeing something similar happen with the big brands? Are they also going for these types of customers with these types of campaigns? I don't think they're specifically going for a type of customer, or the way that the smaller brands can afford to do because they have a more specific aesthetic. But what they're doing very well and what leather goods brands are not doing so well for the most part is they're leaning into this high-low strategy idea, which means that you have some really premium items that are super expensive that go into the hundreds of thousands.

14:59But you can buy a Cartier diamond necklace for, I think, about$800,$900, so under$1 ,000. And what that means, you know, high load, or some call it the mother-daughter strategy, where, you know, the mother might buy herself a more fancy, expensive piece, but then she'll buy her daughter maybe for a birthday or for her graduation, a piece that's a little bit less expensive. But then the daughter will associate that brand and that item with a really nice memory and with this connection to her family, to a special event. And so I think that's what they do really well because the bigger brands, they really need to acquire new customers.

15:38I think this idea that you can only go for the super wealthy customer, the top customer, that only works for very, very few brands in the luxury space altogether. In general, if you want to grow as a brand, you have to get new young customers. And if you forget about Gen Z, if you forget about the young customer, then you're going to lose out in the long run. And jewelry has done that across the board. We can generalize a little bit. they've done that better than a lot of the big fashion and leather good brands. I also think there are kind of like some trickles of this ethos coming into bigger or more traditional brands, especially through collaboration with a lot of these younger designers.

16:17Nadine Gozen collaborated with the Swiss diamond label Gublin. And she said that like they, you know, they learned a lot from each other and that like she made this heart shaped bracelet that like she presented through her own aesthetics and like shot it how she would have shot it low light that kind of thing very casual and that they were surprised that like it's still connected with their shoppers and another collaboration that I think comes to mind for me is our Audemars PA tapped Carolina Bucci who is an Italy-based designer to collaborate on a watch and you know they like did this really innovative Florentine finish for the watch.

16:58But what was interesting about that and that she was surprised by is that they said like, oh, no, like, let's shoot it how you would wear it. Like, let's shoot it next to your colorful beaded bracelets. And so that's a really small example, but it is one example of this kind of ethos, more playful, approachable thing trickling into the traditional space. Does that say something to either of you about the mindset of this luxury consumer today? I know that some of this is like segmented across generations and price points, like the aspirational versus the ultra wealthy, but collectively, does this say something about the consumer that jewelry brands that are selling things at this price point can be so much more playful right now?

17:38Is it macro? Is it something else? Why are they embracing that kind of aesthetic right now? I think one key factor is that customers in general are seeing the jewelry space, whether from the bigger or the smaller brands as being more creative. And And there's been this lack of creativity coming from a lot of the big fashion houses. So in 2024, the luxury market as a whole declined by 1%, but jewelry, the segment, grew 2%. And actually this year, Bain forecasts that the sector as a whole will contract between 2 % to 5%. But the most positively predicted category to potentially grow or at least not decline is jewelry out of all categories again.

18:16So I think a big reason for that is because they've really mastered this creative spark, this idea of individuality. I think a lot of customers, I'm sure Joan can speak to this even better, but a lot of the Gen Z younger customers, they really want individuality, creativity. They want to express themselves. They don't just want a designer piece for the sake of having the logo or the label. So I think that that is something that jewelry just across the board has done better. Also, the turnover rate is not as high. So they're not expected to bring out new collections every season the way that fashion does.

18:50So I think that does give them a little bit more breathing room to really perfect the things that they do bring out onto the market well. Yeah, and to add to that, it's interesting because jewelry does have this history of play. You think of the Cartier nail bracelet and love bracelets. Those are kind of like based on these like little mundane objects. And they're still really, really relevant and iconic today. And yeah, definitely it is like this new ethos and new generation coming in. But also they're like older collectors, more serious, high spending, traditional consumers. Many of them are also attracted to this.

19:28A lot of them, I think a reason for that is like you have the basics in your jewelry box and then you see something new and you're like, oh, that gives me an incentive to spend. On a not so positive note, so we've talked so much about how well jewelry is doing and, you know, there's storytelling, there's value, there's experimentation. There's all these incredible tailwinds. What about headwinds as we look out into the future from whether it's tariffs, which we haven't addressed yet, or material costs or cooling demand? Are there any headwinds that could take aim at jewelry in the next couple of months to a year that could sort of derail all of this?

20:04Because like other sectors, jewelry is probably also cyclical. Yeah, absolutely. So tariffs are a huge issue for everybody, right? But for jewelry in particular, I think the peculiarity is that a lot of jewelry is made in or sold out of, produced and assembled in a country like Switzerland. Switzerland, despite its location smack dab in the middle of Europe and where I am currently located, we are not part of the EU. So what does that mean? We have totally different tariffs that might hit the Swiss market and the Swiss jewelry market, where Richemont, which is the biggest conglomerate that houses two of the biggest names in jewelry, Cartier and Van Cleef and Arpels.

20:41So that would mean that they would have to potentially raise prices a bit more than they've traditionally done. But they've been quite conservative with that, so it hasn't hit them too much. And in fact, Richemont's results are much better than Carrings or LVMHs. So yes, it's a potential headwing, but it's not as bad for now. But obviously, things are very up in the air with tariffs. Things could change any minute. And then the material prices, which we've already touched on, gold, silver, diamond, the question mark of what lab-grown diamonds mean. But honestly, it's a bit more slow moving. So because jewelry brands, they plan very carefully and they don't have this pressure of turnover rate as quickly as fashion houses, all of this will take a slower and more measured effect.

21:24It won't be so dramatic, most likely. And those indie designers that Joan wrote a lot about, they probably have the advantage of agility and being able to pivot quickly when you have a small supply chain like that and maybe and smaller collections, too. Yeah, definitely, definitely. But at the same time, you know, they're seeing their margins really pinched right now. And I think it'll be interesting to see whether like the rising costs put a damper on a lot of this experimentation and risk taking that we've seen over the past few years. Yeah, I think when gold prices are going up as much as they have, I'd rather be the big company that can do financial hedging, that can buy a huge amount of gold in advance and maybe get a more favorable price.

22:06I mean, there's a lot of advantages to size in a market like that, but I agree. I tried. I tried for the indie designers. No, I think the point that Cartier, though, can't suddenly say, hey, we're going to make all our jewelry out of resin now. I think people might notice that in their stores. So like there's advantages to being big and advantages to being small. Yes, absolutely. Like Simone said, there's advantages to being David and there's advantages to being Goliath in this climate as a jewelry brand. I think that's a nice spot to end on. Simone and Joan, thank you so much for joining us. This was so fascinating.

22:40Thanks so much for having us. This was such a fun conversation. Thank you so much, Sheena and Brian. Please be sure to check out Simone's article, Why Jewelry Feels Like a Better Deal Than a Handbag, and Joan's article, Who Would Pay$20 ,000 for a Hamburger Ring, at businessoffashion.com. These and other stories are available to BOF Professional subscribers only, and you can find the links in the episode notes. You've been listening to The Debrief, produced and edited by Olivia Davies and Eric Bria. I'm Brian Baskin. And I'm Sheena Butler-Young. We'll be back next week with a new episode. Thanks so much for joining us and be sure to follow us wherever you get your podcasts.