Being in the jewelry business is both profitable and challenging. One of the ways to keep up with the times is to know the demand for such products. According to a Research and Markets report, the industry may achieve a compound annual growth rate of 6.25% from 2017 to 2021.
But then, what fuels this growth? What opportunities can companies maximize to be more competitive?
What Drives the Sales of Jewelry?
Many factors work in favor of the industry, including the following:
1. Online Sales
Now is the best time for jewelers to consider working with a jewelry retouching company as more customers buy what they need online. According to IBISWorld data, both watches and these accessories experienced significant growth over the last five years until 2019.
Within this period, the sector reached a compound annual growth rate of almost 5%, with an increase of 2.9% in 2019. In the end, it generated a whopping $8 billion in revenue in less than seven years.
The growth of e-commerce also benefits local, independent, and small retailers who are usually up against big multinational brands. It extends their reach outside their community. They can even find partners and customers in other parts of the world.
2. Higher Disposable Income
For many, jewelry remains a discretionary type of spending. In other words, it is non-essential, so when the going gets tough, it will be the least of priorities. This scenario already came true during the Great Recession when expected global sales declined by 4% from 2008 to 2009.
Fortunately, the world is recovering. Several countries already have a higher disposable income. One of these is the United States. According to the OECD Better Life Index, the average adjustable income for a household is $45,000 annually. It’s significantly higher than the OECD average.
3. Innovation and Technology
Science and technology grew exponentially within the last twenty years, benefiting many industries, including jewelry. Designers, for example, can already create 3D images of their work with the right software or application. Manufacturers, meanwhile, may already mass-produce them with the highest accuracy using tools like 3D printers.
They can also use big data or analytics to help them identify the trends in the market, the kinds of jewelry that may appeal to the market, and consumer sentiment. Companies can also utilize price monitoring software to know how they compare with others.
The Word for Today Is Sustainability
If jewelers can do one thing for their business to experience significant growth, it may be to embrace sustainability-it pays off.
In a report by the Harvard Business Review, consumer products marketed as sustainable grew more quickly than the conventional ones. They also achieved over $110 billion in sales, while their market share expanded. It increased to 16.6% in 2018 from only 14.3% in 2013.
How can jewelry businesses, though, practice sustainability?
The advantages of jewelry often fall under the radar, but thankfully, more are seeing them clearly. Thus, the industry may look forward to possible higher revenues and bigger markets in the next few years.
Nevertheless, there’s no time to be complacent. Embracing technology and promoting sustainability can make retailers and manufacturers one step ahead of the pack.