Jewels' hypnotic lure - includes article on men's watches and jewelry - Apparel Merchandising

Discount Store News, Feb 20, 1995

Fine jewelry sales in the mass channel have traditionally been driven by gold rings, earrings and chains. But now jewelry featuring gemstones is coming into its own.

This segment of the category currently accounts for 30 percent of sales at Ames, says Sandy Sansevera, divisional merchandise manager for accessories and jewelry. He says sales of gemstone jewelry have "quadrupled" in the last four years. Ames, which in 1994 redesigned its jewelry department layout, adding sleeker fixtures to its island format, devotes about 20 linear ft. per store to gemstones.

Sansevera points to increased consumer awareness through such venues as the QVC and HSN channels on TV as reasons for growing demand. He adds that with mass merchants taking the trouble "to pursue and stock" gemstones today, shoppers are seeing good selections at value-driven prices and realize they can afford to sport attractive gemstone jewelry.

Which stones are most appreciated? While two years ago consumers had a fling with blue topaz, pink ice and amethyst, the deeper-hued gems are in vogue now. Sansevera says nothing beats emeralds or rubies today, except diamonds. He adds that the traditional Ames customer prefers the real McCoy; the chain carries no cubic zirconium for two reasons. There has been no sustained demand by Ames shoppers and presenting it would conflict with the diamond program and Ames' overall presentation of authentic gemstones.

Except for a narrow offering of "created" gems, Ames maintains a selection dedicated to authentic stones. Even at a price point as low as $39, the customer receives a certificate of authenticity with each purchase.

At Wal-Mart, both ends of the spectrum play off each other.

At the extreme high end of its bridal program, Wal-Mart has stepped beyond traditional mass merchant territory. There is nothing cheap about the diamond ring offered at $1,299 in the Wal-Mart showcase--in fact, you read that it has been appraised at $2,100 by the International Gemmological Institute.

But how can a self-service-oriented discounter make sure that consumers are getting the authenticity message? Posted behind the purple heart-shaped display box, the IGI card states: "14 karat yellow gold mounting (ring) weighing in total approximately 2.1 DWT, stamped "14K.98" with logo, containing seven natural diamonds (set in 14 karat white gold), round brilliant cut, one estimated weight 0.68 carat, color = colorless/near colorless (F-G), clarity: I (1) / I (2), six total estimated weight 0.30 carat, color near colorless, clarity: I (1) / I (2). Total estimated retail replacement value: $2,100.00." That may confuse some customers, but its ring of authenticity will no doubt reassure others.

Most discounters have accentuated less-pricey birthstone selections in earrings and rings. Caldor merchandises "color of the month" semi-precious stones from $39.99 to $79.99 for a pair of earrings. Birthstone rings at Caldor sell in the $109.99 range in 10 karat gold; smaller stones set in 14 karat gold start at $59.99. Pricing and selection in the Kmart program are similar; locked countertop cases show off the lower-priced birthstone earring sets, with similar but larger stones set in rings displayed in the showcases.

Of course, Wal-Mart would never ignore the discount heart of many programs. Its "Austrian Cut Chatham Euro CZ" ring at $39.97 is one of its hottest items, according to a sales associate who called cubic zirconium in general "a striking impulse buy."

There is little doubt about why or how steadily CZ has climbed in popularity. While CZ can be worn in settings and clusters as big as the Capitol dome, the customer who uses some restraint can convincingly exhibit the cachet of diamond jewelry for a fraction of the cost.

Donna Miller, senior jewelry buyer for Rose's, says that CZ is a key factor in her business. In her basic 14 karat gold earring program, CZ studs are the number one seller.

The fine jewelry strategy at Rose's is a narrow and deep one. "We go after items," says Miller. This opportunistic strategy calls upon the buyer to pinpoint trends.

At a chain like Ames, committed to a broad offering in fine jewelry, the stores constantly test the boundaries of the assortment. "We have a .25 carat and .5 carat weight diamond that were new for fall," says Sansevera, adding that Ames has extended its upper price points from about $149.99 to the $299.99 range.

Most discounters are appealing to the price/value mindset of their consumers with prices generally ranging from under $12 for smaller CZ earrings up to $150 for 10 karat gold rings with small semi-precious gemstones. Wal-Mart tops off its non-bridal men's ring selection with such items as a 14 karat gold ring with ruby and diamonds set off against a black onyx ground, price $499.99.

While rubies and emeralds are currently the most popular of the colored stones, diamonds retain a strong lead over other gems, a lead that is still growing, helped by a profusion of product in the market, which keeps prices down.