Friday, February 03, 2012

U.S. Jewelry Sales Set Record $68.3 Bln in 2011

Total U.S. jewelry and watch sales were a record $68.3 billion in 2011, a gain of 11 percent over 2010, based on preliminary data from the U.S. government. 

This was well ahead of 2010’s $61.5 billion, and substantially ahead of the prior record year – 2007 – when U.S. jewelry and watch sales were $65.3 billion. 

In the 2007-2009 period, the U.S. economy was in a recession. While many jewelers claimed hardship, the recession actually had only a modest impact on retail jewelry sales. Peak-to-valley – 2007 through 2009 – jewelry and watch sales dropped by only 11 percent in the U.S. market before posting a solid recovery in 2010 and 2011. 

Total jewelry sales rose by 10.8 percent to $59.2 billion in 2011, while total watch sales rose by 12.1 percent to $9.1 billion. Watch sales were 13 percent of total industry sales, stable with the prior couple of years. 

The total industry sales gain was the first double-digit increase since the mid-1980s, when the industry posted several years of sales gains in the low-to-mid teen range. 

Most of the sales gain in 2011 was due to inflation related to higher costs of precious metals and polished diamonds: retail jewelry prices were up by about 8.4 percent during the year, so “real” jewelry sales rose by about 2.6 percent. 

Execs Think Gold Price Will Hit Record in 2012

A recent survey of gold mining executives by PricewaterhouseCoopers found that a majority think the price of gold will continue to rise in 2012.

According to the accounting firm’s 2012 Gold Price Report, some 80 percent of gold mining executives queried expect the price of gold to increase throughout the year. Only 6 percent foresaw a decline.

A majority expect the price to peak at $2,000 an ounce, which would be a record. At press time, it was trading at $1,664 an ounce, though at one point last year it hit $1,900.

The highest prediction was $2,500, the survey said; the lowest, $1,350.

The survey questioned 40 executives, whose companies represent 26.5 million ounces of gold mined in 2011.

Women Favor Jewelry for Valentine’s Day—But Aren’t All Getting It

Nearly one-third of women (29 percent) would choose jewelry if they could receive only one gift for Valentine's Day this year, according to a new survey by Sentient Decision Science for Sears. 

Ranking second to jewelry were the other Valentine’s Day staples, flowers or chocolate, favored by 20 percent. Some 9 percent of women preferred perfume, and only 8 percent said the “latest technology product.” 

Yet, despite this preference, another survey predicts that not every woman will receive the jewelry she wants on Feb. 14. 

According to the American Express Spending & Saving Tracker, 29 percent of consumers are giving flowers for Valentine’s Day this year, with 19 percent giving gift cards, and only 15 percent giving jewelry. 

Other data of interest of jewelers..... 

Arkansas Park on Verge of 30,000th Diamond Find

The Crater of Diamonds State Park in Murfreesboro, Ark., the only public park where visitors can search for diamonds, is about to mark the 30,000th stone found there.

According to a park release, the latest count of diamonds found at the park is 29,934—just 66 short of 30,000. The park plans some commemoration of the 30,000th discovery.

Last year, 106,524 people visited the park, and a record 500 stones were found. It celebrates its 40th anniversary in March.

In the most recent notable find, a 2.44 ct. stone found last year was recently cut into a 1.06 ct. F VS2 pear-shape diamond, appraised at $21,639.

Christie's Jewelry Sales +41%

Christie's reported sales of $5.7 billion (GBP 3.6 billion) for 2011, which represented a 9 percent year-on-year increase in British pounds. The auction house reports results in pounds so it recorded a jewelry sales increase of 35 percent, but by dollar value that figure rose 41 percent year on year to $600.1 million. Watch sales jumped 21 percent to $116 million, exceeding the $100 million mark for the first time. Strong increases were also recorded for sales of wine and art categories such as 20th Century Decorative Arts, British and Irish Art, Old Masters and 19th Century, Asian Art and Post-War and Contemporary Art. However, sales for Impressionist and Modern Art fell 28 percent. 

Christie’s jewelry and watch department observed that the diamond market held strong throughout the year. A perfect heart-shaped diamond of 56.15 carats sold for $10.9 million in Geneva and a pair of cushion-cut diamonds of 23 carats each were sold for $9.3 million in Hong Kong in May. The famous Elizabeth Taylor diamond of 33.19 carats sold for $8.8 million on December in New York. 

Colored diamonds also had an excellent year at auction with a pear-shaped diamond of 32.77 carats realizing $6.6 million in New York. During one New York auction, a Burmese ruby of 8.62 carats sold for $4.2 million and an emerald of 23.46 carats was sold for $6.6 million. In Geneva, a Burmese sapphire of 130.50 carats sold for $7.1 million. The famous 16th century Peregrina pearl sold for $11.8 million in New York in December. Another pearl necklace, which Christie’s had sold in New York in 1981 for $72,000, was sold again in Geneva in November for $790,000. 

Steven P. Murphy, Christie's chief executive, observed that a global appetite for collecting art and jewelry was reflected in increased buyer activity during 2011. U.S. and European clients accounted for 77 percent of sale registrations, with 13 percent from Greater China, an increase of 2 percent on 2010. Registered clients from Russia and the CIS increased 15 percent. New clients represented 12 percent of the value of global sales. 

The website,, welcomed 77 percent more unique visitors than 2010 and 29 percent of Christie’s bidders transacted online. Christie’s LIVE™, the interactive online bidding platform, drew 25 percent more bids than the previous year with two works of art selling across this channel for more than $1 million. 

As part of the sales series dedicated to the Collection of Elizabeth Taylor, Christie’s held its first online-only sale, which ran in parallel to the live auctions out of Christie’s New York. The two-week time-based auction resulted in $9.5 million in sales and bidders from 25 countries competed for 973 additional items from Taylor’s personal collection. 

''We are operating in an informed market with pricing, curation and presentation key to success,'' said Murphy. ''Christie’s goal is to serve its clients. As we continue to see strong auction sales, we are also responding to the wishes of our clients with Private sales growing and accounting for GBP 502 million of our sales total. Collectors also continue to be inspired by the great collections. We saw intense interest in the Gourdon Collection in Paris, the Norton Collection in New York and the Cowdray Collection in London in particular, all attracting a broad audience. The crescendo of the year was the Collection of Elizabeth Taylor which was seen by 58,000 people in an eight-city tour before being sold at auction in New York in December. With bidders from 36 countries, every one of the 1,778 lots found a buyer contributing to total sales of $157 million. 

''As we approach the sales over the next fortnight in London, we are optimistic about the market in 2012. We also remain committed to our role as cultural stewards through our auctions, private sales and exhibitions. Christie’s is a unique place where commerce and connoisseurship is the hallmark of the Christie’s team and we look forward to an exciting series of upcoming sales, exhibitions and partnerships,'' he concluded.

LVMH Sales +16% to $31B

Revenue rose 16 percent year on year to $31.2 billion (EUR 23.7 billion) for luxury group LVMH during 2011 and profit jumped 22 percent to $7 billion (EUR 5.3 billion). Specifically for the watches and jewelry segment, revenue nearly doubled to $2.6 billion (EUR 1.95 billion) in large part due to the integration of Bulgari. LVMH reported that organic revenue, which reflects comparable-store sales and exchange rates for the watches and jewelry segment rose 23 percent. 

LVMH watch and jewelry brands continued sustained growth across all geographies, according to the company. TAG Heuer made a splash with the launch of two exceptional products entirely developed and manufactured by its own workshop: the Mikrograph 100 and the Mikrotimer Flying 1000. Hublot continued its innovations with the launch of Masterpieces, the new watch collection of Grandes Complications, and extended its store network. Zenith benefited from the renewal of its emblematic lines which demonstrate the first class craftsmanship of its Manufacture. Bulgari's performance was strong and the collections, which were developed around the theme Serpenti, a symbol for the jewelry maison since the 1950s, were very well received. 

Bernard Arnault, the chairman of LVMH, said that 2011 results highlighted the power of the group's brands. ''Our businesses enjoyed excellent momentum and profit from recurring operations passed the threshold of 5 billion euro for the first time. The agreement with the Bulgari family was one of the key moments of the year. In 2012, LVMH intends to further strengthen its global leadership position in high quality products by relying on its sound, long-term strategy."

Amazon's 4Q Sales +35% But Profit -57%

Online retailer reported a strong fourth-quarter with revenue surging 35 percent year on year to $17.4 billion for the three months that ended on December 31. However, net income plunged 57 percent to $177 million. Product sales during the quarter rose almost 31 percent to $15.3 billion while business services increased 74 percent to $2.1 billion. Operating expenses, including cost of sales, marketing and fulfillment, rose 38 percent to $17.2 billion.

Jeff Bezos, Amazon's founder, said, ''Our millions of third-party sellers had a tremendous holiday season with 65 percent unit growth and now represent 36 percent of total units sold.''

Amazon's financial year reflected a 41 percent year on year increase in sales of $48.1 billion and profit fell 45 percent to $631 million.

Guidance for the company's first-quarter underway now suggests that net sales could increase 22 percent to 36 percent, but that operating income is expected to be between a loss of $200 million and a gain of $100 million. The guidance included approximately $200 million for stock-based compensation and amortization of intangible assets.

Brooke Burke Partners with Chad Allison for Jewelry Line

Television personality Brooke Burke will launch a jewelry line with the label ''Brooke Burke Collection by Chad Allison.'' Her partnership with the brand created 30 jewelry styles consisting of bracelets, pendants, earrings, and rings in black and white diamonds and colored gems in gold and sterling silver.
The pieces will retail from $149 to $3,000 and Chad Allison targets a distribution channel of 700 doors across the U.S. The official launch for Burke is planned for Luxury by JCK in May. 

Burke is an actress, dancer, author, model and co-host of numerous televised shows such as Dancing with the Stars, Annual Golden Globe Awards and Miss America Pageant. She co-founded Baboosh Baby and is a brand ambassador for Sketchers.