Customers from Generation Z and millennials, according to a new breed of fine jewellers, are driving growth.
While new brands are entering the market, Cartier, Van Cleef & Arpels, Chopard, and Bulgari continue to dominate the luxury jewelry market. Richemont's jewellery maisons are the company's fastest-growing division, with revenues rising 38% year over year in the third quarter. For example, Louis Vuitton created LV Volt, a genderless fine jewelry brand designed by Francesca Amfitheatrof, in 2020.
They're right to trust the youth, especially in China and the broader Asia-Pacific market, according to Jean-Philippe Bertschy, executive director of wealth management at Swiss investment bank UBS, management group Vontobel. “The younger generation are in love with fine jewellery. It’s also linked to social media. They want to have iconic pieces and [showcasing their] social status is very important to them.”
According to Jean-Philippe Bertschy, executive director of wealth management at Swiss investment management business Vontobel, they're right to put their faith in the young, particularly in China and the broader Asia-Pacific market. "Fine jewelry is very popular among the younger generation. It also has a social media component. They want iconic things, and [providing proof of their] social standing is very important to them."
Adding fine jewelry to the mix
Bernard James, a Brooklyn-based jeweller who was recently sold by Gucci Vault, Gucci's concept store project, is paving the way for gender-neutral jewelry manufacturers. "There was a need in the marketplace for robust men's jewelry," he says of his early creations, which have subsequently expanded to appeal to a wider audience. "[Our clients] loved the bending of the rules."
Younger Gen Z buyers, according to Vontobel's Bertschy, are more than willing to invest on exquisite jewelry. "The younger generation, or Gen Zs, want to save a little money in order to get their first luxury item, which should be something iconic and high-end." He points out that during the Covid-19 pandemic, many people were encouraged to treat themselves as a reward or as an act of pure enjoyment.
Developing a fine jewelry brand, as opposed to a costume jewelry company, is a high-risk approach. When she first launched in Thailand in 2014, O Thongthai founder and jeweller Chanyaporn Thongthai, who goes by the moniker O, focused on costume jewelry, but the collection was not as successful as she had intended, with prices ranging from $120 to $400 and a synthetic pearl choker at $750. “As I'm self-funded, when I started I thought that I can't start with fine jewellery because everything is so expensive. Gold is just so expensive,” she says. She started with brass plated jewellery and reinvested the money back into the business, enabling her to produce more fine jewellery items, priced at between £575 to £20,000. Her designs are described as an unconventional take on traditional jewellery, with the All Ice with Blue Sapphire signet ring featuring a large sapphire surrounded by small white diamonds. Annual sales are now topping $1 million, according to the brand.
Bongiasca decided to add beautiful pieces to her collection in 2021, a technique that appears to be paying off with both high-spending clients and her existing customer base. "It's a slow and steady process," she explains. "You must be able to establish your brand in order to gain the credibility and reputation necessary to create beautiful jewelry." Her beautiful jewelry is made of 18-karat gold and diamonds, and many of the pieces feature her distinctive enamel cutouts. The demi-fine range from Bongiasca costs between €240 and €1,300. Her excellent collection, which includes expensive stones such as diamonds and emeralds and is made of 18-carat gold rather than the normal 9-carat, costs between €5,000 and €7,000.
The value of a close link in marketing
Instagram is a great way to engage with young people, customers, emerging brand designers say. It’s how Thai-based brand O Thongthai secures many of its bespoke orders — every item is now made to order. “[Clients] prefer to talk to me directly because it's personal,” Thongthai explains. “It's kind of fun for me to talk to everyone and see who my customer actually is and what they want.”
She claims that high-end clientele, particularly celebrities, value a close relationship with the jeweller. When clients spend more than $20,000 on a ring, they want to be able to communicate directly with the jeweller. These youthful customers also expect more involvement, if not outright input, in the manufacturing process. According to the firm, O Thongthai, which specializes in bespoke signet rings and has attracted the likes of ASAP Rocky and Skepta, is 90% direct to consumer and 10% wholesale. With only one wholesale partner, Browns at Farfetch, she's under pressure to increase revenue through bespoke orders and creative ventures.
Fraser Hamilton, a London-based fine jeweller who was also a participant in the Gucci Vault concept store, says Instagram has helped his clients to communicate with one another, with him as an individual. Some 40 per cent of Hamilton’s customer base is 25 to 34 year olds, while 17 per cent are aged 18 to 24, he says. Typically, clients will send him a direct message on Instagram, requesting a custom piece of jewellery or enquiring about a particular item. He’s ready to send over a quick video and close the sale. “I believe a lot of people are coming to me because they like the fact that I'm clearly an individual who still posts cats and sunsets and leaves and a pendant on [Instagram] stories.”
Key takeaway: Through social media, creative concepts, and materials, emerging fine jewellers are exploring new methods to engage with youthful consumers. Their goal is to educate and increase their young clientele. Raw material costs are fluctuating, prompting them to rethink their pricing methods.
