Much has been talked about in the last decade about the so-called retail apocalypse. That is, the large number of retail stores closing. The truth of the matter is, this has been talked about for the past 30 or so years. I remember in the mid-1990s, when e-commerce first came along, many people were talking about how retail was going to die and how we would all be ordering everything from furniture to groceries online.
Retail is Dead! Long Live the Internet?
Whilst it is true that some retail businesses have simply been replaced by technology. Shops such as video stores have been replaced by online streaming, many newsagents are now mere lottery outlets, with online news replacing physical newspapers and magazines, and many bank branches closing due to low patronage. However, the fact is, that most retail shops are still alive and kicking.
In the early days of e-commerce, and even during the 2000s, a lot of retail jewellers held the view that jewellery shouldn’t be bought and sold online. However, in recent years, and especially during the pandemic years, many jewellers have started or expanded their online offering.
One of the main arguments against online trading was the mistaken belief that consumers needed to physically view a diamond or piece of jewellery prior to purchase. I debunked this in 2009. Whilst my opinion on the subject hasn’t changed, 10+ years of retail jewellery experience has taught me that there is much more to jewellery retailing than just selling jewellery.
Whilst a lot of jewellery is unique, the fact is, a lot of jewellery is not, that is, most jewellery nowadays has become commoditised or is part of a brand’s collection that is resold via a jewellery retailer. Therefore, a fungible product such as a “1ct diamond solitaire ring” is probably best purchased online as there is a larger range at lower prices.
Above: Simple engagement rings such as these are best purchased online to get a better quality and price.
However, one key difference between online and physical brick and mortar jewellery stores is that it is much harder to develop customer relationships, connections and come across as authentic online than in a brick and mortar store. It can therefore be said that successful retail jewellers have become more service providers, or consultants, rather than ordinary run of the mill retailers. Speaking from experience, we get a lot of customers coming to us for repairs, re-models and other such services in our retail store, whilst we have very few of our online customers in that side of our business.
Lack of Good Staff Plague The Industry
In the December 2022 edition of Jeweller Magazine, a number of retailers were interviewed and the main concern voiced was a lack of staff. In most retail industries, whilst this is a concern, it is of particular concern for this jewellery industry as staff need to be highly knowledgeable and attentive to customers.
My experience of hiring retail staff has been very hit and miss. I would say that about 50% of the retail staff I have hired have been able to do the job properly and even exceed my expectations. However, the other 50% simply weren’t up to the task and some have even so bad, they lost us customers. Speaking to both bench jewellers who work with retail assistants and my own customers, it would seem like I’m far from alone in my plight of hiring staff.
Above: Bad customer service and not understanding customers has become too common in the industry.
Therefore, whilst the pandemic has created staff shortages, the problem of recruitment in the jewellery industry has existed for many years now and certainly isn’t new. The root cause of this is that retail staff are treated – and paid – as just that – retail assistants. However, in reality, a retail assistant in a jewellery store may be much more than that. Many so-called retail assistants in the jewellery industry take on the roles such as jewellery designers, diamond specialists, workshop managers and much more. It therefore remains a paradox within the industry that those designing jewellery or managing a workshop are also expected to serve customers and sell jewellery, in many instances at a wage lower than their colleagues working as bench jewellers or gemstone setters.
Online Stores Moving To Brick and Mortar
Jogia Diamonds started in 1998, trading in diamonds and jewellery purely online. In 2007 we moved to an “upstairs” physical location so customers could consult with us in person. In 2014, we moved into a retail space and since then, have even purchased a retail property to house our shop.
Many former online only jewellers have crept into the retail space. Signet owned James Allen and Blue Nile both were both former online only jewellers who have established physical brick and mortar shops. Ironically for the aforementioned companies, their physical locations compete with other jewellery stores owned by the same parent company.
However, in my opinion, some jewellery retailers, both online and offline merely setup shop to overcome their own imposter syndrome. There really isn’t any point in setting up a shop in a high street such as Pitt Street Mall in Sydney or King Street in Perth if you already have a shop nearby. Likewise, there’s no point in setting up a physical showroom to complement your online store if it is going to be staffed by someone not up to the job, or just plain incompetent.
The Future of Jewellery Retailing
So is jewellery retailing dead? The answer is no, and in my opinion, jewellery stores have a bright future. However, in the future, to be successful, retailers will:
- Adopt a hybrid model of retailing. This is much more than a “click and collect” model and involves selling jewellery online whilst offering personal, one-on-one services in store.
- Offer unique products and services. Whether this is a unique jewellery collection developed in house or extra services such as offering cut analysis on diamonds such as we do.
- Focus on recruiting, training and keeping good front-of-house staff who are skilled in areas such as jewellery design, gemmology or managing a workshop. With the growth of CAD/CAM, the role of a bench jeweller has been diminished greatly, hence they are no longer more valuable than front-of-house staff.
- Not dilute their brand by establishing unprofitable brick and mortar shops that add little value to customers.