IN A RECESSION YEAR IS… SILVER
A combination of factors has contributed to silver’s surge in this year of economic upheaval. Government handouts, the rising price of gold, pent-up consumer demand and silver’s affordable price point saw silver jewellery weather the storm better than other precious metals in the Australian jewellery industry. Here we asked four major players in the Australasian silver jewellery industry for their opinion on silver’s remarkable endurance.
Reaping the silver spoils
All our respondents reported good sales in silver jewellery this pandemic year. Co-director of
Ellani Collections, Paul Hicks, said he has seen very good increases in sales since a slower March due to retail store opening restrictions, with only Victoria seeing slower sales.
“On regularly talking to retailers many feel the strong increases in sales is due to government stimulus that has been targeted to a demographic that are more inclined to spend any spare disposable income that they may have,” he said.
“Other good sales are due to the travel restrictions, many that cannot go on cruises or overseas holidays are spending on jewellery.
There was similar success at Portobello Jewellery where director Astral Maheshwari reported a growth in sales, with some retailers turning over Portobello’s range at an amazing rate.
“Affordability could certainly be a reason for the uptick, but for us the biggest reason is the flexibility offered by Portobello’s customisation application, where a retailer can up-sell using a silver piece,” she said.
“The effectiveness of the application has seen our retailers limiting their other non-performing ranges in gold and substituting it with our silver range.”
Across the pond, New Zealand-based designer jeweller Kagi has seen a customer group that’s focused on their sterling silver range. Jewellery maker and designer Nick Hoogwerf said that this type of customer identifies with the precious nature of sterling silver and its properties.
“Another benefit of sterling silver is that it’s affordable but still recognised around the world as a precious mineral, I think people really connect to that,” he said. Founder and CEO of Najo Jo Tory said that Najo has seen a surge in demand over the past two years, and even more so this year, in spite of the pandemic and subsequent recession.
Are young shoppers smitten by silver?
According to a survey conducted on behalf of the US Silver Institute’s Silver Promotion Service (SPS) by InStore, silver is resonating with a younger demographic with consumers aged 20-40 the most likely to buy silver jewellery. When probed on this finding, Nick said this young demographic is a group Kagi has seen growth in sales.
“With layering and stacking pieces as the hero trend in jewellery this year, we are seeing
this customer group increase their spend and overall basket size for our silver pieces,” he said.
To tap into this market, Nick said the key is to have pieces in your range that are enduring and will fit in with other brands/looks when layering as the look needs to look seamless.
Conversely, the rest of our contributors’ sales didn’t necessarily reflect an outsized appeal to young consumers. Jo said that Najo’s market research has found that their customer base is generally older than the millennial market, and that these older customers are lovers of silver jewellery.
“Having said that, we now have a growing younger demographic that are responding well to our finer designs – many of which are gold-plated designs,” she said. Portobello’s store in Melbourne is more than 45 years old, and Astral said they have a loyal customer base and are lucky to have three generations of a family visiting the store.
“We find quality designs in silver appeal to all not just 20-40 age bracket,” she said. Nick expressed a similar sentiment, stating that,
“I feel all age groups have accepted silver jewellery, seeing very good sales in (yellow) gold and rose gold-plated silver jewellery, designs that can be retailed at very affordable price points.
Silver, perfectly suited to online selling
In a press release published in August this year, The Silver Institute reported that some of the reasons why silver jewellery is expected to fare better than other precious metals this year is due to its relative affordability and greater suitability to online selling.
All our contributors agreed with this finding, and some provided additional reasons as to why silver is so well suited to online selling. Paul said silver jewellery that is priced in sweet price points with designs that resonate with the consumer see very good sell through.
“Retailers that replace their fast sellers on a regular basis are seeing very good growth in this category of their business,” he said.
Jo echoed similar views stating that, “Naturally silver jewellery works well for online sales due to the lower price point and the myriad of designs that follow fashion trends.”
Silver’s popularity online due to its affordability is also apparent to Nick, who said silver’s affordability is what separates it from other metals and makes it perfect for gifting.
“With the COVID pandemic, more and more customers will move their annual Christmas shopping online, so we expect sales of affordable pieces to increase as customers think of purchasing gifts for their loved ones,” he said.
Astral agreed that silver scores on price point, but believes that online sales are a function of store credibility, designs and shopping experience.
What precious stones suit silver best?
Diamonds and cubic zirconias are always clear fail-safe stones that look good with silver jewellery pieces, but doesn’t mean coloured stones can’t. Astral said Portobello Jewellery carries more than 40 natural gemstones, and their customer base appreciates the beauty and rarity inmany
“We have partnering retailers regularly asking for tourmalines, morganites, emeralds, rubies and a host of semi-precious gemstones,” she said.
Designs featuring morganite cubic zirconia are popular at Ellani Collections, with Paul reporting strong sales.
Jo took the view that coloured stones are more suited to silver jewellery than diamonds or cubic zirconias.
“Whether it be turquoise, blue topaz, chrysoprase and onyx – just to name a few,” she said.
Silver jewellery’s potential prospects/pitfalls ahead
As Nick alluded to earlier, with silver’s affordability combined with other factors mentioned above (rising price of gold, widespread belt-tightening), many are expecting strong silver jewellery sales over Christmas. Paul concurred and felt that Christmas will be very strong, and 2021 will be “interesting.”
“A lot will depend on what stimulus the government is prepared to continue with and the confidence of the consumer moving into 2021,” he said.
“Even more reason to work hard at good stock selection now and maximise this current selling season.”
In preparation for the season, Nick said that his team at Kagi are organising marketing, merchandising and sales support well in advance, so their retailers can have the best Christmas trading possible.
“We have a festive red range of products due hit stores at the start of November which is sure to be popular,” he said.
He said other brands should consider Christmas to be a time where customers like to have a piece of jewellery to wear that is unique and has an element of playfulness.
“I invite you to keep this in mind when decking out your store this Christmas: what is the ‘fun’ element you can highlight in your store and what can you provide your customers that will set them apart and inspire them into this festive season?”