Three Designers, Two Retailers, One Very Candid Conversation…

At JCK’s first designer-retailer roundtable, held Jan. 13 at our offices in New York City, the often delightful, sometimes dysfunctional relationship between the creators and marketers of today’s cutting-edge jewels came under scrutiny. What emerged after two hours of intense discussion—edited and condensed on the following pages—was a consensus: Transcending the differences between both camps requires steady and clear communication, a commitment to partnership, and, crucially, a flair for storytelling.

Janet Goldman	Jeanne Johngren
Tara Silberberg	Simon Alcantara

Simon Alcantara was a classical ballet dancer before an injury
sidelined his career. While recuperating in his West Village
fifth-floor walkup, he began designing jewelry that eventually caught
the attention of buyers at Bergdorf Goodman. Fragments CEO Janet Goldman
added a retail space to her successful fashion jewelry showroom in
Manhattan’s SoHo district after attending the owner/president management
program at Harvard Business School. Jeanne Johngren worked as a
film and music video producer for the likes of Jeff Buckley, Mick
Jagger, and the Ramones. After having a child, she moved to rural New
Jersey and devoted her time to making jewelry inspired by the medieval
tapestries and mosaics she discovered during a post-grad stint in Paris.
The Clay Pot’s Tara Silberberg took over her mother’s then
21-year-old ceramics gallery in the heart of Brooklyn’s Park Slope
neighborhood in 1990 and has since developed a cult following among
jewelry aficionados on the hunt for the next best thing. And Maeve Gillies
won numerous awards for playing the clàrsach (a Celtic harp) in her
hometown of Edinburgh, Scotland. Eventually, she turned her creative
energies to jewelry, culminating in the 2006 launch of her acclaimed
bridal line, MaeVona.

Few people understand the tensions
surrounding the designer-retailer partnership better than our
participants. Although they share a uniquely New York–centric worldview,
their experiences in the jewelry industry reflect business and design
trends unfolding across the country. We plied them with cheese and wine
so they would divulge the secrets of their success. But truthfully, the
conversation needed none of those things to flow. Among the many lessons
learned over the course of the evening, here’s one that may surprise
you: When it comes to trunk shows, never forget the babka.

Designer jewelry is serious business for Maeve Gillies (left) and Victoria Gomelsky, JCK’s editor in chief.

JCK: Let’s talk about the recent holiday. It sounds like it was up, if slightly, for most people.

Tara Silberberg: Our sales were very solid. In the last two years, we saw the upper end of our business completely tank—sales over $1,000 just stopped. People were definitely spending more money this time, but it certainly wasn’t 2007.

JCK: What’s your perspective, Simon?

Simon Alcantara: Well, we’re doing a lot more sterling, and I hardly did any sterling two years ago; it was all gold, 14 karat and 18 karat. We had necklaces that were $15,000, and now it’s mostly under $1,000 that sells. We’re getting customers who couldn’t buy our product before. We’re also getting customers e-mailing, asking a lot of information about our product, and my brother came to help streamline a lot of stuff and he asked why we weren’t selling online. I said, “I don’t really want to do e-commerce.” So we have a private website with a line sheet and we sell from that. We’ve had one return in a year and a half. And we’ve built a really big database. Customers will e-mail us just to tell us they wore the earrings to a party. We sell it at the same price as the stores, but customers come to us because they want a connection.

Janet Goldman: We’ve had—knock wood—a very good year. I asked my salespeople, “What do you think it is?” And they said it’s because the customers need that connection. And with designers, they need someone who can explain the jewelry and tell the story behind the jewelry. The salespeople at Fragments know the customers; they know what they like, what kind of gifts the guy should buy.

Alcantara: What really opened my eyes is that I started selling to a company in Japan about five years ago and I started doing trunk shows with them, and I was amazed when I arrived, because the salespeople knew the collection better than I did. That doesn’t happen here. The whole last 10 years, everything changed.

Goldman: Absolutely. We changed how we merchandised the store. After things started getting tight, people were intimidated by all the gold in the front, so we put all the gold cases in the back, and we put the fashion/costume up front. Our motto is “Something for everyone.” During this time, we brought in merchandise you could buy for $125. We also had merchandise you could buy for $12,000. And that seemed to work. It was the middle, where we used to be, where businesswomen would buy themselves earrings for $900, $1,000—they stopped. It was a real learning curve to figure out what to do because we were all so freaked out—jewelry was the last thing you needed.

Maeve Gillies: We saw the opposite side of that, because bridal is a necessity. What was so curious was to see the shift in the market where consumers are so well informed and they’ve done so much research. We’ll have salespeople call us, saying, “A customer is here in the store, they’ve driven four hours to get here, and I’m embarrassed to say they know three times more about it than I do.” There are so many pressures today for retailers to keep up with, and consumers know so much more, so what is going to bridge that gap?

Goldman: I can answer that. We have such a close relationship with the designers in our stores. We know them, we’ve nurtured them, we’ve taught them how to develop their line so it’s viable for wholesale. For wholesalers, nothing is as important as you having a steady connection with that retailer. You have to tell them, “I made this new ring; I changed the color of the gold.” You have to stay close to them and in turn, they will to you.

Jeanne Johngren: I was talking to [designer] Suzy Landa. She does myriad trunk shows and she’s seeing this frontline experience, this disconnect between store owners and sales staff. The staff needs to see these pieces and know the stories to sell them. Because it’s art, which is forgotten, unfortunately.

Alcantara: I think now is a good time to get that message across, because customers are hungry for it.

Gillies: They’re hungry for the values of it. Something that’s making our product so interesting to people is because it has that ­genuine value behind it. It’s not just marketing; it’s not just words or poetry someone has pulled off the Internet. We have poetry written by my mother; I illustrate the catalogue. I go out and do the trunk shows. So people can really trust that.

Johngren: I want to talk about price point issues. I think that’s a key place for better communication between the stores and designers. I think the stores need to tell designers, “I need more items under $500.” Not when they show up at your booth and you’ve already made everything. I see designers working their butts off for pieces that wholesale for $750, and it retails for $1,800, and stores won’t buy it because they’re going to buy that little thing that comes in under $1,000.

Alcantara: Dealing with stores, sometimes it’s not so effective. At Bergdorf’s, I used to leave catalogues and information and they’d still call me, they didn’t care. I was talking to my brother and he said it was time to start taking things into my own hands. I started blogging and recently started tweeting. But we only blog about the collection when it’s on the cover of something; other times, we’re just blogging about life. My brother said, “You’re not selling jewelry—you’re selling you.”

Goldman: Do you want your brand to be known or your identity?

Johngren: Now, it’s a mix, because of the nature of blogs and the nature of Twitter and Facebook.

Goldman: I started the company Fragments not using my name, because a company is much more valuable when it’s about everybody. I didn’t need to have that ego.

Alcantara: What I realized is that all these things are really a tool for oneness. A tool for connecting people. You can send a message and it doesn’t have to be about your business. My rule is no gossip, nothing negative. I tweet one message or photograph a day, something positive. It goes simultaneously to Facebook, Twitter, and two blogs. And it takes me three minutes to do. And you should see the messages I get from people.

Gillies: Consumers are so far ahead of most manufacturers and most retailers in the way they interact. They know what they want. On Facebook, we’ve cultivated this relationship. We won’t talk about prices, but we’ll talk about styles, or designs we’re selling a lot of at the moment, or a sneak preview of the collection, or I send a picture of me outside a castle in Scotland over Christmas as inspiration for new styles. It’s so helpful because it’s a way for consumers to ask directly for what they want.

Goldman: And the consumer has all the power. They can make it good for you; they can make it bad for you.

Silberberg: Yeah, they’re in my store, checking prices online.

Representing the retail contingent: Janet Goldman (left) and Tara Silberberg

JCK: We just did a story on that—on how consumers are using their phones to check on pricing while they’re in the stores.

Silberberg: It gets into the whole idea of consumers vs. the retailers, the big stores vs. the small stores. We’re competing with the big department stores who then discount like crazy at inopportune times when the collection’s coming in. I was having some difficult conversations with some vendors, saying, “You’re setting prices, but you’re not policing it.” It’s tricky. We’re in uncharted territory in terms of how all of us get along and try to figure out a good strategy for how to get some control over all these websites. There’s a lot of merchandise out there, a lot of stores that overbuy and then dump.

Goldman: All the designers are doing it. They’re all on those sites.

Alcantara: I’m not. I was approached by Gilt [Groupe] and by Rue La La and I thought, “What’s going to happen when things get better?” I’ve bought stuff on Gilt and Rue La La before, but I’ll never pay full price again, ever. So I’ve never done it. It could have been a quick way to make money. 

Silberberg: The majority of my sales are gifts. I think it’s more the self-purchasers and the shopaholics who are buying for themselves at work. We wound up with a lot of merchandise at Christmas with big accounts and we’re trying to figure out what happened. And we think it was deep discounting, not by Gilt but by others.

Gillies: We don’t mind the competition. We love being right next to our competitors in the showcase, probably because they have brass and glass silver samples, and it’s not real stuff and they shouldn’t be trying to pretend they’re cashmere when they’re cotton. That’s not the future of the jewelry industry.

Johngren: But you also stand out because your product is very different. Particularly in the bridal world.

Gillies: We’ve always gone against the grain, even back when it made us not sell anything. [Laughs] As a company, we’ve always believed in selling less. We’ll never leave you with something you’re not selling.

Goldman: How do stores get rotation from you?

Gillies: Our retailers tend to have less than they should have, but they also tend to be happier because they don’t have too much. They might have 12 rings compared to hundreds of other people’s, and it stands out in a sea of things made with base metal. We’ve never left a store with product they didn’t want.

Goldman: And that’s partnering with a store, and that’s absolutely the most important thing.

Alcantara: As long as you’re dealing with an ethical retailer. A lot of times, they’ll overbuy and they know they can send it back.

(Above left) Jeanne Johngren shares a laugh with Maeve Gillies; (above right) Simon Alcantara and Tara Silberberg talk about what it means to be a true partner.

JCK: Aged inventory and returns—has that been the central issue of the last year?

Johngren: I think we lose money every single time. The other issue around stores and consignment is that they’d rather sell what they have their own coin on. It used to be they’d buy 80 percent and you’d give them 20 percent. And now it’s a $5,000 preorder and $25,000 on consignment. Nobody makes money. 

Goldman: If a retailer wants to buy $40,000 worth of ­merchandise from you and they don’t have the credit—and I hope you check credit—then I think you can partial-ship the order and get paid as it goes. If you say to a retailer, “I’m not shipping you because your credit stinks,” and you know that retailer for a while, you’re not going to get their business when things get better, so I think it’s wise to figure out a way to compromise. Feed them and let them feed you so you don’t kill those relationships, because, believe me, if you don’t show you’re partnering with them, you’ll lose a good customer.

Alcantara: We were just given at the CFDA a best-practice 10-page memo on what we should look for in retailers because some designers were having a lot of problems. Basically: Don’t ship them if they don’t have good credit. If you sell to a store that doesn’t pay you, even if it’s a great store, you’ll be out of business.

Goldman: I’ll be honest with them. The designer can’t afford to lose $7,000. You look them in the eye and talk to them straight; anyone who won’t do that is not going to be a good partner.

JCK: Do you work on consignment, Tara?

Silberberg: Really only on bridal. We did it at a jeweler’s suggestion and it worked out. He’s a good account now. I make the commitment to photograph it and put it on the website and if it’s successful, we buy it.

Goldman: You look at some place like Bergdorf’s and anyone would be happy to give them pieces. Because what happens when you’re in one good store is all the other good stores want you.

Alcantara: I was with Bergdorf for eight years and exclusive to them for two years, and that made a huge difference. I’ve never done a trade show. It’s all word of mouth.

Goldman: Everyone’s got to invest to get where they’re going. But I feel for stores that have to pay high rents; the overhead is huge. You have to be very careful about what you take into your store.

Gillies: My biggest concern is for the future of the industry. With the price transparency, and the way people compare everything, people coming in with printouts, and Blue Nile. It’s not even like selling a handbag with the markup you can get on that.

Goldman: It’s going back to what I started with: It’s all about the relationship. It’s the comfort you get going into a store where the salesperson knows you. There’s a personal thing going on.

JCK: Does that mean the only way to go is to make your world much smaller, so you can maintain these relationships?

Goldman: With the right staff. I hire people people. During prime selling season over the holiday, I had a salesperson with a customer for three hours. She didn’t buy anything. But that’s what you have to do.

Johngren: When we go to trunk shows, connecting with the customers and it taking two and a half hours to sell.… When they leave, I feel for you retailers like you wouldn’t believe, because it’s just so intense. Retail—it’s improv theater. It may or may not be about the details of the pieces. It’s about that connection.

Goldman: Also, this season, trunk shows represented a huge amount of income for the wholesale business. The designers and retailers have time to build a relationship and they bring pieces they don’t normally have. It’s a very good investment. I always tell them to bring a chocolate babka with them—bring the cake. I sent my CEO to Japan with two babkas.

JCK: What else should designers be doing?

Goldman: They need to have a business plan and be able to afford to front some business.

Silberberg: We want to support new designers but at the same time, it’s a $10,000, $15,000 investment and you’ve got their line and then they say, “Well, I think I want to go back to school and be a dentist.” And this has happened to us a bunch of times, so we’ve gotten real conservative about bringing in new people.

JCK: It’s that tension between wanting someone new, yet ­wanting to figure out if they’ve got their legs.

Silberberg: If a customer comes back in 10 years and needs their ring resized, they expect us to do it. I always want to buy from people who do a ton of trade shows because it’s an indicator they take their business seriously.

Goldman: There are some excellent stores. They don’t buy a lot, they require a lot of attention, but they network in the industry and they’re respected, and they tell other retailers, “Check this line out.” There are a lot of things in the equation of who to sell to.

Gillies: It’s a really curious time in the business, and everyone has to be true to themselves and be careful about managing people’s expectations. We have a really successful relationship with a retailer in D.C. This year, because we always have a big Christmas rush, they preordered 40 mountings in October and they sold nearly everything. Not all of the stores are like that. But they recognized they were selling to a new bridal customer that wants to walk into the store and walk out with something. Because I think a lot of guys think they can walk in and walk out with an engagement ring.

Silberberg: There’s definitely a man who believes that.

Gillies: He doesn’t know they carry mostly CZ and don’t have it.

Goldman: We have to stay focused on value, on the relationship, and also partnering up—knowing the store is not your enemy, the store is your friend. You know, I took a big brand into the store, which is not really our thing. We sell Gurhan, but another big brand—Alex Sepkus—came in and that brought more business to us. I was so surprised. It wasn’t only good for them to be exposed to our customer, but it also made their customers look at us.  

JCK: Well, that’s a good note to end on. Any parting thoughts?

Alcantara: Don’t resist change. Try new things. You’ll find your tribe. It’s an exciting time once you get over “I’m not making as much money as I used to.” [Everyone laughs.]