Total sales of fine jewelry and fine watches in the US market rose in October by 2.0 ‎percent when compared to October a year ago. That gain is in line with the average of the ‎past six months, a healthy sign. The big news, though, was the dramatic revision in ‎September’s sales gain. Last month, the government’s preliminary report showed that ‎sales surged by 4.8 percent in September; that was revised to a more realistic 2.0 ‎percent. ‎

Based on October’s continued trend of a low single-digit sales gain – in line with the ‎average of the past six months – we are comfortable with our forecast of a sales gain in ‎the low single-digit range for the all-important 2015 November-December period.‎

 

A Divided Market
Total sales of fine jewelry and fine watches in the US market in October were an ‎estimated $5.2 billion, according to the latest preliminary data from the Department of ‎Commerce. The market remains bifurcated, as the following data illustrates: ‎

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

• Specialty jewelers, those merchants who derive a majority of their revenues from ‎the sale of jewelry and watches, posted a slight sales decline of 0.4 percent in ‎October. Specialty jewelers’ sales represent just over 40 percent of total US jewelry ‎sales. This group of retailers has been losing market share for the past four ‎decades.  ‎

• Jewelry sales through multi-line merchants such as Wal-Mart, Costco, and others ‎rose by an estimated 3.7 percent during the period. Jewelry sales through multi-line ‎merchants represent just under 60 percent of total US jewelry sales. ‎

• As we have often said, consumers are clearly shopping for “value,” and specialty ‎jewelers have not been able to convey a “value” message. ‎

Jewelry Demand Positive in October
Based on jewelry demand for the past six months, jewelry sales have grown by an average of just ‎over 1.9 percent, excluding weak sales earlier in the year. On a full year-to-date basis, jewelry ‎sales are up by only 0.7 percent for the first ten months of 2015.‎

The graph below illustrates monthly growth since the beginning of 2014, on a year-to-year basis, ‎of fine jewelry and fine watch sales in the US.‎

 

 

 

 

 

 

 

 

 

 

 

 

 

 

It is important to note that the government made significant revisions to preliminary ‎September sales data reported last month. Initially, the government’s data showed that ‎total US sales of fine jewelry and watches were up 4.8 percent. After the first revision, the ‎data shows that September jewelry sales grew by a more modest 2.0 percent. The ‎September data could be revised several more times.

‎Specialty Jewelers’ Sales Weak
Specialty jewelers’ sales during October were an estimated $2.1 billion, a 0.4 percent ‎decrease over October 2014, as the graph below illustrates. This is in line with reports ‎from our sample of specialty jewelers. Most specialty jewelers report that customer traffic ‎has been weak for the past several months, though the average ticket increased due to ‎slowing sales of beads and improved sales of diamond jewelry. ‎

 

 

 

Outlook – We Are Optimistic
The US jewelry industry is in the midst of the all-important November-December period. ‎Based on some early reports, we believe that current sales trends will continue: low single-‎digit gains. Early reports also show that shoppers are buying their jewelry from multi-line ‎merchants rather than at specialty independent jewelers. ‎