Platinum &You: Back-To-Back Winners

In a March 1993 report, jewelers told JCK they’d noticed a growing consumer interest in platinum jewelry. Today, the momentum continues. In fact, consumers’ interest in design, value and something out of the ordinary are making platinum jewelry and retail jewelers back-to-back winners.

Much of the growing consumer interest in platinum jewelry can be attributed to marketing and educational efforts by the Platinum Guild International. A broader selection of product from designers and manufacturers also plays a role. These factors have created a situation in which half of platinum jewelry sales are initiated by the customer, not a salesperson, say jewelers contacted by JCK.

This is especially true with bridal jewelry. The Platinum Guild International USA Jewelry, the organization’s U.S. jewelry marketing office, opened in 1992 and soon afterward launched an aggressive co-op campaign featuring advertising in national bridal magazines. Some readers even tear out the ads to show their jeweler, says Marc Green of Lux, Bond & Green, a retail jeweler based in West Hartford, Conn.

Customers aren’t the only ones taken with platinum jewelry. Jewelers like it because it distinguishes their stores from many others and it’s a full-margin item that hasn’t fallen victim to discounting or promotional pricing. In fact, jewelers tell JCK there’s no reason not to get keystone or better on platinum jewelry. “Future margins depend on how widely platinum is picked up,” suggests Tim Greve of Carl Greve Jeweler in Portland, Ore.- “For us, it won’t drop because we’ll focus on getting better lines and better looks.”

The turn on well-targeted platinum jewelry also is good, say jewelers. Colleen Rafferty, a buyer at Steiner’s in San Leandro, Cal., says the store gets about a 2.5X turn on most of its platinum jewelry. Since the store adopted the GIA/ARMS inventory system, she expects platinum to sell through within about four months.

Jewelers who haven’t tried to sell platinum jewelry often fear the price will scare off customers. But those who do sell it say customers show very little price resistance. “We sell lots of Lazare Kaplan diamonds,” says Mark Moeller of R.F. Moeller in St. Paul, Minn. “When you show platinum to a customer who buys Lazare diamonds, they don’t balk.”

Adds Greve, “If they’re interested in white metal, they’re receptive. Price doesn’t enter into it unless it’s a very plain wedding band.” In fact, say jewelers, the only tough resistance is from customers who simply don’t like white metal.

PLATINUM & YOU : CONTEMPORARY CLASSICS

by the customer, not a salesperson, say jewelers contacted by JCK.

Customers aren’t the only ones taken with platinum jewelry. Jewelers like it because it distinguishes their stores from many others, and it’s a full-margin item that hasn’t fallen victim to discounting or promotional pricing. In fact, jewelers tell JCK there’s no reason not to get keystone or better on platinum jewelry. “Future margins depend on how widely platinum is picked up,” suggests Tim Greve of Carl Greve Jeweler in Portland, Ore. “For us, it won’t drop because we’ll focus on getting better lines and better looks.”

Depth, breadth: PGI-USA estimates that at least 5,000 retailers nationwide carry platinum jewelry, many with in-depth stock. Nearly four in 10 platinum manufacturers surveyed by PGI-USA report having more than 1,000 retail customers. Independent jewelry stores account for about 75% of platinum jewelry sales, while small chains account for 15% and department stores and large chain stores account for 10%.

That could be changing, however. While platinum jewelry basically has been an upmarket item, PGI-USA President Laurie Hudson points to signs that it may be heading toward broader-based appeal. Tiffany & Co., for example, offers a popular all-platinum, knife-edged wedding band that retails for less than $300.

Development of less expensive platinum jewelry coupled with education should help platinum jewelry to penetrate middle- and eventually mass-market stores, says Hudson. For example, Sterling Inc., Akron, Ohio, the nation’s second largest retail jeweler, just introduced a new collection of platinum bridal jewelry in some of its guild division stores. Company spokesman Joe Freedman says sales are encouraging, especially for two-tone (platinum and gold) jewelry.

With this platinum ring… A large percentage of platinum jewelry sales are in bridal jewelry. Jewelers interviewed for this report say their typical platinum bridal jewelry sale ranges from $1,000 to $1,500 (without the center stone).

And their typical platinum bridal customers are somewhere between their late 20s and into their 40s, professional, established, educated. This holds true for first and second marriages. “It really depends more on where they are in life than on how old they are,” says Moeller.

But platinum sales aren’t limited to bridal jewelry. “We sell lots of two-tone chains, tennis bracelets and platinum designer jewelry,” says Marc Green. In fact, designer jewelry seems to be the route most jewelers take toward non-bridal platinum profits. The most frequently mentioned platinum jewelry designers include Michael Bondanza, Lagos, Simon Sobie, Paul Klecka and Steven Kretchmer. In bridal designs, it’s Scott Kay for Winward and Judith Conway.

Sales of non-bridal platinum jewelry typically are higher, from $1,500 to $3,700 per piece.

As far as design is concerned, jewelers told JCK in 1993 that customer preferences were fairly evenly split between antique and estate styles and contemporary styles. Now jewelers see a shift toward contemporary styles that can be worn from day into evening. “We’ve always offered contemporary styles, but customers have really been biting on it in the past year or so,” says Greve. However, even the contemporary designs have a more timeless look than futuristic style.

Who buys non-bridal platinum jewelry? Four in 10 platinum jewelry purchases last year were gifts to women; two times out of 10, women bought it for themselves.

The platinum push: Would jewelers push platinum as aggressively without PGI’s efforts? Yes, they say, but PGI has made the effort a lot easier.

“I think it was the right product, the right place and the right time,” says Moeller. “There’s been a general move toward quality, and platinum epitomizes quality – customers can tell when they touch it or pick it up. But PGI has certainly made the transition easier.”

Marc Green concurs. “We probably would have [promoted it aggressively on our own], but PGI has pushed it, and I’m going to be on the bandwagon!”

Jewelers agree that important points to building platinum sales are training, stocking and good merchandising. All jewelers interviewed for this article have trained their staff about platinum, many using PGI training sessions offered last year. “PGI’s training was really the catalyst for us,” says Steiner’s Rafferty. “We’ve all been here some time and knew about the product already, but the training helped refresh our memory.”

Samuel Gordon Jewelers, Oklahoma City, Okla., threw the Ultimate Platinum Party (see JCK, November 1994, p. 68), an event that made platinum promotion history. But most jewelers rely on more modest promotions, such as trunk shows or advertisements by designers. This may change, though, as jewelers such as Moeller consider bigger platinum promotion budgets.

Jewelers say platinum must be merchandised carefully for maximum impact. They point to the need to stock a significant selection and to keep it together in the showcase, grouping it by category or designer. Then top it off with signs and other display props to make a significant platinum statement.

FIVE FIVES FOR PLATINUM PROFITS

Platinum jewelry doesn’t sell itself. Jewelers who are successful with platinum jewelry rely on a well-trained staff fully versed in platinum benefits. It also helps to have some reference points to get customers interested in platinum and to overcome any objections. Here, courtesy of the Platinum Guild International, are five five-point lists to help build better platinum profits.

OPENING STATEMENTS:

1. “Have you ever felt a piece of platinum jewelry? [Put a piece in their hand.] It’s the rarest, purest and most precious jewelry metal in the world, and it’s quite substantial – 60% heavier than 14k gold. Try it on and feel the difference!” If they seem receptive, try to put the piece on them.

2. “Let me show you the fastest-growing category in the fine jewelry market today – it’s platinum. Take a look at these beautiful new designs!”

3. “Would you like to take a look at our newest platinum engagement and wedding ring designs? We have styles ranging from classic traditional to modern.”

4. “Are you looking for an outstanding value? I’d like to show you platinum. It’s the world’s rarest, purest and most durable jewelry metal. Look at all these fabulous new designs!”

5. “Would you like to see the strongest, most secure and most durable mounting for your diamond? It’s platinum.”

OBJECTIONS/RESPONSES:

Objection. “I don’t look good in white metal.”

Response. “Actually, the color of platinum is very different from silver or white gold [show comparison pieces]. And with our combination designs in platinum and 18k, you have the best of both worlds. Let’s try on a few pieces and see how beautiful and versatile it looks!”

Objection. “Can I afford it?”

Response. “Platinum is truly the best value for your money. It’s the rarest, purest, most durable and strongest jewelry metal. It will wear and last far better over time than other metals, plus it makes diamonds look more brilliant.” Try to sell the customer on the attributes of platinum before discussing price. Once customers are sold on the product, they will be more open to the price.

Objection. “Isn’t platinum for old people?”

Response. “Actually not. Platinum is for everyone. The consumer group that is driving the revival of platinum comprises 18-35-year-olds in the bridal market. The new designs are nothing like estate jewelry! Let me show you these beautiful new designs.”

Objection. “All my jewelry is gold – will platinum go with it?”

Response. “Platinum complements yellow gold jewelry and gives you a more versatile look, particularly the combination of platinum and 18k gold. Many people wear a two-tone watch, so they’re already used to wearing white and yellow together.”

Objection. “Doesn’t platinum look like silver or white gold? Why does it cost more?”

Response. “It really doesn’t look like white gold or silver. I’ll show you. There is a distinct color difference. Silver has a white tint and white gold has a yellow undertone; platinum is the only metal that is naturally white. There is also a distinct weight difference. Platinum is the heaviest since it is the densest. You can identify the platinum ring in your hand with your eyes closed.” PGI sells a set of training rings – one white gold, one silver, one yellow gold and one platinum – to show the difference.

DISPLAY/MERCHANDISING:

1. Group platinum jewelry in a showcase so it makes a substantial statement. Also use in-case signs and brochures from PGI.

2. Use fashion magazine layouts that show platinum-colored apparel and jewelry. For example, the March 1994 issue of Elle magazine has an article titled “White Hot Platinum” and the Feb. 12 Style section of The New York Times has a detailed story on platinum jewelry.

3. Create dramatic effects by using white fabrics, platinum-colored pebbles and packages wrapped with platinum-colored paper and ribbon. Or use platinum-colored fabrics, purses, lipstick holders or compacts.

4. Drape platinum necklaces across paintbrushes, stack rings on the brushes and display with platinum-colored metallic paints. (Clear double-stick tape hidden in strategic places goes a long way toward keeping displays intact.)

5. Use platinum-colored tissue paper and ribbon to create a soft feel. Add white silk flowers, such as tulips and calla lilies, along with lace, for an attractive bridal display.

…AND FIVE MORE IDEAS:

1. During the holidays, decorate the case with white snowflakes and platinum-colored glass balls.

2. Platinum jewelry looks beautiful against backgrounds of sapphire blue, emerald green and ruby red.

3. Use platinum colored “stars” in your showcase as props. Either stand them up or hang them from the windows.

4. Use Chanel’s “Platinum Egoiste” cologne as a prop (and to make the store smell nice).

5. Spray-paint a 33-LP record album or credit card “platinum” to use as a display. (Be sure the numbers on the credit card aren’t visible to someone who might copy them down.)

PROMOTION IDEAS:

1. Platinum: The Ultimate Party. Play off the theme of the highest achievement in music, credit cards, etc., being platinum.

2. A Night of White Delight. Use white for flowers, decor, snow, etc.

3. White on White. A white bridal theme emphasizes the return to tradition in weddings. Arrange for the best bridal shop in town to provide white wedding gowns for a show complete with models.

4. Platinum: The Metal of the Millenium. Focus on the advent of the new millenium with the use of futuristic props.

5. A New Generation goes Platinum. Play up the fact that 18-35-year-olds are a prime platinum market. Tie in with the platinum record motif or even “Star Trek, the New Generation.”