US economic uncertainty is often listed among the key reasons for caution in the diamond trade. Inflation and weak consumer sentiment are indeed a concern: Along with the slowdown in China and the rise of synthetic diamonds, these factors have converged to exert pressure on the market.
While all that is true, there is some optimism about jewelry retail in the US, the largest market for diamond jewelry. Amid the many challenges facing the trade, jewelry sales have normalized. This is after a topsy-turvy period that saw sharp declines during the pandemic and a strong recovery afterward.
In that context, last year, the industry retreated from the records it set in 2021 and 2022. It has maintained those reduced levels in the first half of 2024, which may be well off the highs, but are by most accounts in line with, or above, pre-Covid-19. Jewelers with the right focus are doing well.
That sounds like an obvious statement, but many do not have that attitude. There are reports of heavy discounting among independents, which is resulting in a highly promotional retail environment. Retailers’ aggressive adoption of synthetic diamonds in recent years is playing its part in reducing average ticket prices.
I delve into the key dynamics shaping the US jewelry market in my latest piece for Rapaport. It’s not all negative. Branding and customization are major trends spurring growth. Top-tier independents are leading, along with the luxury brands.
Furthermore, the bottom line is positive. As one contributor noted, there is a sense of normalization in the jewelry sector after several years of volatility. And it appears to have stabilized at levels we could only have dreamed of a few years ago.
Initially published in the July Rapaport Research Report, read the full analysis here.
Image and illustration by David Polak & Elisé Jurkovic (Rapaport).
Comentários