In a recent article on Solitaire, an B2B gem and jewelry magazine published by India’s Gem and Jewellery Export Promotion Council (GJEPC), diamond analyst Paul Zimnisky says that “despite all the forecasts of economic malaise possibly affecting consumer spending on jewelry, the year 2023 may have some positive surprises in store.”
According to Zimnisky, major US jewelers, such as the world’s largest retailer of diamond jewelry Signet, have noted a “fall off” in the “lower-priced self-purchase” category in particular – specifying that it has seen weakness at “price points under $500.”
A “fast-growing” online retailer, Brilliant Earth, cut its 2022 sales guidance for the second time in 6 months in November 2022, saying that it is “seeing a further lengthening of the decision-making process” of its customers given the current macro conditions.
On the other hand, LVMH, which raised its prices “across the board” between 3% and 7% earlier in the year in anticipation of inflationary pressure, said that it was on pace for another record year of jewelry and watch sales (through late-2022).
Looking ahead, Zimnisky says, while the Fed’s “most aggressive sequence of relative rate hikes since the 1980’s will temper inflation – the question for the diamond jewelry industry remains how much collateral damage will there be to the economy and ultimately the spending ability of the consumer in the interim?”
Read the full article here.
