Sales Strategy
A Wake-Up Call For Retail Jewelers | June 22, 2016 (1 comment)
New York, NY--I titled this article “A Wake Up Call” because I want to urge jewelry retailers to wake up and see how online companies such as Amazon, Wal-Mart, Ebay, Blue Nile, Overstock.com, Google Store, Zales, QVC, Costco, Macys, and Bloomingdale’s sell jewelry products and offer services online. They all have one thing in common: they grab market shares from brick-and-mortar jewelry stores and eventually get jewelry retailers to go out of business. I hate to say it, but they are partially succeeding.
Also, due to an oversupply of jewelry merchandise from China, India, and Turkey, jewelry retailers are bombarded with an abundance of merchandise. The retailers are stuck with products that they can’t move quickly, and due to fears of competition from online and chain stores, they can’t mark up at triple key as they used to do several years ago. Consumers are smart and able to find the same jewelry online—or what they perceive as the same jewelry—at 50% above the manufacturing cost. So, this is alarming! It is forcing the brick and mortar jewelry retailers to reduce their overhead and to think hard about going online. Going online will expand consumer choices, reduce prices to consumers, and increase the volume of items.
The Internet and social media (Google+, Facebook, Instagram, Pinterest, Snapchat, Twitter, etc) tsunami that we are experiencing today will continue as more and more consumers use their mobile phone, tablet, PC, or laptop to access products and services of their choice by searching and buying online. According to Google and Facebook, over 75% of consumers are using their smart phones to search, and eventually buy products and use services online. More and more retailers (excluding jewelry retailers) are investing in revamping and redesigning their Internet site in order to accommodate the consumers and encourage them to shop online. Furthermore, the brick and mortar retailers invest in Google ad words and social media such as Facebook, Instagram, and Twitter to get their products and services out in the market.
But I am afraid that jewelry retailers across the country are not following suit. They do not participate in the Internet tsunami luring Internet customers to their shops. In 2015, by some estimates, a still-low percentage of independent jewelers had some form of Internet presence and social media exposure.
About fifteen years ago, I joined the jewelry industry. I have degrees in electrical/computer engineering and have been working for over 30 years in the high tech industry. In 1998, I established my company, which consults with small businesses on how to go online successfully. I saw a huge opportunity to work with small businesses (especially jewelry retailers) that don’t have the expertise to deploy technologies in order to compete in today’s high tech environment. The jewelry industry is one of those industries whose retailers are often wary and shy away from using technology to advance their marketing and sales.
In 2008, my company became an Internet affiliate of Variety Gem. We helped their retailers to go online by designing their branded website for them to showcase their products, as well as other manufacturers, products and services. We gave the retailers the choice to add products and services from other manufacturers as well as their own. The first thing we did was rebuild their website database, adding over 3,000 jewelry items. The second thing we did was to go on the road and participate in trade shows to sell the idea.
Unexpectedly, I encountered resistance from the retailers due to cost and commitment issues. After investing over $150,000, I thought the cost per website was reasonable, and I believed that I was providing a total internet E-commerce solution for the jewelry retailer. The jewelry retailers didn’t have to worry about their website and ongoing maintenance (photography, adding content, etc). But I saw three major reasons why the jewelry retailers are not participating in this Internet phenomenon.
- Not understanding how to use the Internet and how social media works today.
- Being afraid of not recouping investment dollars
- Continuing to allocate marking budget on old media such as newspaper, radio, and billboards
The result: Because jewelry retailers are not participating and not taking advantage of Internet and social media, more and more retailers are left with shrinking revenue and profit—some are even going out of business. By some estimate, every year since 2006, about 500-700 jewelry retailers close their shops and going out of business. This also creates frustration among the manufacturers, who then look elsewhere to sell their products and services, such as through Amazon, eBay, QVC, Costco, and Blue Nile.
After over two years of trying to convince the jewelry retailers to come on board, I would like to suggest the following eight point solutions for jewelry retailers to consider:
1.Every five years, redesign your store website with a new look. Build an e-commerce site to showcase as many as items as you can. Give many product choices to consumers to choose from and give the consumers enough reasons to call or visit your store. I would suggest that you have between 500-750 items on your website.
2. Go mobile! Give the younger consumers the opportunity to view your products and services while they are on the go. The use of Google search phrase like “near me”, “closest” and “nearby” are becoming very popular among jewelry buyers. www.thinkwithgoogle.com is a site that will help you to understand the mobile user’s behavior.
3. Offer an internship to a college student or even a sharp high school senior to maintain the site by adding new jewelry items and linking to your social media sites.
4. Open social media business accounts. Over 80% of adults use social media channels and 60% of them use two or more social media channels.
5. Use social media to promote your product and services. Facebook is not always the best choice: it’s good for Boomers but Instagram, Pinterest, Snapchat and Twitter are very popular among younger consumers, ages 15-35 years old.
6. On your social media site(s), post at least two new contents a day, seven days a week. Social media sites are, by design, places to share information and inform your customer about your product and services. A comprehensive site and a mobile site with product and service are the places to showcase, get customers to your store, and eventually sell.
7. Invest a few hundred dollars a month on Google, Facebook, or Instagram in AdWords. The investment is worth it because you will access more consumers in your town and surrounding towns. The more exposure you have, the better!
8. Make sure you incorporate digital media in your marketing spend; don't limit yourself to traditional media but rather look at your marketing as omnichannel so that you reach all age groups of affluent consumers. Use your traditional advertising--TV, billboard, radio--to help drive consumers to your website and social media, and make sure your website and social sites link back to your TV and radio commercials and show your outdoor ads.
In conclusion, don’t wait or don’t say, “I don’t have time”, and don’t delay and think you’ll have time to deal with it in few months. Create a budget to go online as soon as you can. Internet and social media will be a growing part of our lives. The Internet and e-commerce tsunami will continue to propel successful businesses in the foreseeable future.
Menny Bezalel has a Bachelor of Science and Master of Science in Electrical/Computer Engineering from Polytechnic University (NYU). Menny is a founder of Planetscape Inc., an e-commerce company that provides various websites with database and e-commerce solutions for B2C and B2B. In the last few years, Planetscape is advising clients on how to market their product and service on social media platforms. PlanetScape Inc. develops and markets its internet products to many industries as well as the jewelry industry. During his tenure as a founder of Planetscape Menny recruited clients, researched their needs, and managed the day-to-day online business. The online project that Planetscape design and market had major impacts on revenue and profits. To contact Menny Bezalel email him at mbezalel@gmail.com or call 212-869-6906 (office), 516-658-2819 (cell).