IDEX Online Research: Specialty Jewelers’ Sales Weak in December 2010
February 27, 11(IDEX Online) - Specialty jewelers’ sales in the U.S. market were surprisingly weak in December 2010, especially when compared to the strong trend that they posted in the prior month, according to the latest preliminary data from the U.S. Department of Commerce. After generating a sales gain of just over 10 percent in November, specialty jewelers’ sales in December 2010 were up a minuscule 0.5 percent – one-half of one percent, based on preliminary figures.
This is a huge disappointment of specialty jewelers. December sales – generated during the height of the all-important holiday selling period – can represent up to 25 percent of a specialty jeweler’s annual sales. In 2010, specialty jewelers’ sales in December were just 19.8 percent of annual sales.
Further, specialty jewelers lost significant market share in December to other merchants who sell jewelry.
The table below summarizes preliminary sales for the U.S. market during the month of December 2010.
Segment – December 2010 | $ Bil Sales | % Change Y/Y |
Total US Jewelry Sales | $13.6 | +8.3% |
Specialty Jewelers’ Sales | $5.9 | +0.5% |
Jewelry Sales – All Other Merchants | $7.7 | +14.9% |
Holiday Jewelry Sales Strong
Jewelry sales were up 8.3 percent in the November-December holiday selling period in the U.S. market, far ahead of any credible forecasts. Consumers felt wealthier, and they were in the stores buying merchandise, including jewelry.
The November-December holiday period is the most important selling event for jewelers. Historically, this two-month period has represented just over one-third of annual sales, and – in many cases – all of a jeweler’s annual profits.
The table below summarizes sales for the all-important 2010 holiday selling season of November and December.
Segment – November-December 2010 | $ Bil Sales | % Change Y/Y |
Total US Jewelry Sales | $19.3 | +8.3% |
Specialty Jewelers’ Sales | $8.6 | +3.4% |
Jewelry Sales – All Other Merchants | $10.7 | +12.9% |
Full Year 2010 Jewelry Sales Set Record
Total U.S. jewelry sales reached $63.4 billion in 2010, a record level. This was well above 2009’s $58.8 billion, and it was notably above sales of $62.0 billion during the prior record year of 2007.
While it was a record year for the U.S. jewelry industry, specialty jewelers did not participate in the sales frenzy. Their sales rose by a solid 5 percent, but this segment’s sales of $29.7 billion were only the third highest on record. Other merchants who sell jewelry – such as Wal-Mart, J.C. Penney and others – posted a 10 percent gain in jewelry sales for 2010, based on preliminary data.
The table below summarizes preliminary jewelry sales data in the U.S. market for 2010.
Segment – Year 2010 | $ Bil Sales | % Change Y/Y |
Total US Jewelry Sales | $63.4 | +7.7% |
Specialty Jewelers’ Sales | $29.7 | +5.1% |
Jewelry Sales – All Other Merchants | $33.7 | +10.1% |
Specialty Jewelers Lost Market Share in 2010
Specialty jewelers’ market share fell significantly in 2010 to 46.9 percent of total U.S. jewelry sales. In 2009, they held a 48.0 percent market share. At their peak, specialty jewelers had a 73 percent market share in 1971. Unfortunately, they seem to lose market share during most recessions, and they are not able recover that lost ground in the post-recession period.
The table below illustrates market share by major retail segment in the U.S. market for 2009 and 2010.
Segment Market Share | 2010 | 2009 |
Specialty Jewelers | 46.9% | 48.0% |
Other Jewelry Sellers | 53.1% | 52.0% |
It is clear that the fastest growing jewelry market segment consists of multi-line retailers who offer convenient one-stop shopping and have a credible value proposition.
Disclaimer: “Preliminary Data” Is Subject To Revision
IDEX Online Research has discussed these sales numbers with others in the jewelry industry, and we seem to be as puzzled as others are: the December data for specialty jewelers seems to be understated, while the full year total jewelry sales appears to be slightly overstated.
These are government numbers, and they are derived from a statistically sound method of sampling. However, they are routinely revised – usually by no more than a few tenths of a percentage point – month after month, until about mid-year. At mid-year, there is usually one final revision. Sometimes it is only tiny; at other times, it can be huge. A couple of years ago, a mid-year “final” adjustment by the government cut jewelry industry sales from about $65 billion to about $60 billion, with no explanation.
IDEX Online Research continues to update its data base daily. If readers plan to use these numbers in presentations or reports, they should check with IDEX Online to see if there are revised numbers available.
For more detailed information on 2010 year-end retail jewelry sales, please click here.