Chains forge dazzling new jewelry, watch dept - Discount Store News Annual Discount Industry Report; Part 2: Merchandising and Productivity Analysis

Discount Store News, August 2, 1993

The advent of alternative shopping venues has drastically changed the way jewelry and watches are merchandised by retailers and bought by consumers. These categories are no longer relegated to the high-end department store or the trustworthy corner jewelry store. These days, $1,000 items can be bought at warehouse clubs, on television shopping networks and in catalog showrooms.

Full-line discount department stores alone rang up $2.4 billion in jewelry/watch sales last year, according to DSN's annual census. Specialty discounters, including catalog showrooms that specialize in the category, managed to ring up another $2.5 billion in this department.

While a store like Wal-Mart isn't quite at the $1,000 price point yet, discounters have become destinations for shoppers looking for fine gold jewelry, trendy costume pieces and styles of better watches. These items can inch up toward the $100 mark at the mass market level. Consumers are no longer reluctant to buy this kind of jewelry at a discount store.

Part of the change in consumer attitude comes as more discounters revamp stores physically. For instance, Wal-Mart's environmental store in Lawrence, Kan., which opened earlier this year, features sleek new fixtures and carpeting in the department to create a more inviting area for shoppers to select fine gold jewelry.

Other discounters are mixing four-way fixtures, tabletop displays and jewelry counter top displays to show off both fine and costume jewelry.

Watches especially have had a big year at discount. Watches are now considered a fashion accessory, not just a jewelry item. It is not unusual for a woman to now own a "good" watch, an everyday work watch, and a sport watch for weekends. In fact, she may own a watch or two bought specifically to match a particular outfit. Large selections of all three categories are currently selling well at discount stores.

Sales of sport watches especially are a growth area for mass merchandisers. Ranging anywhere from $20 to $40, these sturdy watches feature details like timers and alarms for the serious athlete. The success of this grouping has gone way beyond athletes, however, and now includes even couch potatoes that wear them for their fashion value. This trend has also kept discount sales of watches steady, while higher end retailers reported a slight decline in watch sales for 1992.

The sports watch trend has successfully brought men into the department to buy watches. The category has typically been shopped by women, but the trend has prompted more women to buy for men, and more men to buy watches for themselves at the jewelry counter. Although a number of companies offer women's sport watches, the trend continues to be male dominated.

In costume jewelry, ethnic influences have been a big part of the market during 1992. African-inspired colorations of beads and earrings are still popular. For this coming fall, the ethnic influence is coming from Native Americans. American Indian styles with turquoise and silver details are expected to sell well.

Children's jewelry is now well entrenched in the accessory department of discount stores. In some cases, toy-like jewelry featuring the hit licensed character of the moment is featured in the children's department. The real stuff--tiny gold earrings and necklaces, teddy bear pins and other items--are usually in the jewelry counter where Grandma can get a good look and be inspired.

In addition to jewelry and watches, accessories overall have sold well. Handbags, hair accessories and caps are expected to draw a crowd for Back-to-School.

Denim and '70s inspired looks, such as bags with fringe, are leading the way in the accessory category.