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How Brilliant Earth Gained the Upper Hand Over Signet in the Jewelry Market April 09, 2024 (0 comments)


New York, NY--Recent consumer preferences and purchasing behaviors have markedly transformed the jewelry industry, particularly during the holiday season and throughout 2023.

[Screengrab via Rapaport/YouTube]

This period of change has brought about distinct outcomes for the United States' top jewelry retailers, Brilliant Earth and Signet Jewelers, revealing key insights into the dynamic terrain of jewelry retail.

A video report presented by Rapaport's Senior Analyst Joshua Freedman delves into the reasons behind Brilliant Earth's superior performance compared to Signet, offering a window into the strategic divergences shaping the market's future.

Strategic Divergence and Performance

The video report notes that Signet Jewelers, with over 150 years of history and heavy investment in physical retail, experienced a downturn, with a 6% decrease in sales to $2.5 billion in the fiscal fourth quarter, culminating in a 9% drop for the entire year to $7.17 billion.

In contrast, Brilliant Earth, a younger and more digitally-focused brand known for its e-commerce, enjoyed a 4% increase in quarterly sales to $124.3 million, leading to a 1.5% annual rise to $446.4 million.

The discrepancy in their performances can largely be attributed to their distinct approaches to retail. Brilliant Earth's blend of online sales with the option to view products in physical showrooms caters effectively to millennials and Gen Z consumers, who prefer online shopping and value social responsibility.

Adapting to Consumer Preferences and Market Trends

Brilliant Earth's agility and innovative marketing have enabled it to connect deeply with a value-conscious demographic, leveraging its unique brand identity to outperform the industry average by 7.5 percentage points, as noted by CEO Beth Gerstein.

This success is further highlighted by the brand's emphasis on fine jewelry, which has emerged as a significant growth area, differentiating itself from Signet's traditional focus on engagement and bridal jewelry.

The market's shift towards fine jewelry and non-engagement-related products has also benefited Brilliant Earth. While Signet, with its strong presence in the engagement ring sector through subsidiaries like Kay Jewelers and Zales, faced a 10% decrease in bridal sales, Brilliant Earth capitalized on the broader appeal of its fine jewelry offerings, including earrings, necklaces, and bracelets.

This strategic positioning allowed Brilliant Earth to increase its order volume by 17% despite a decrease in average order value due to selling lower-priced items.

Future Opportunities and Challenges

Signet's struggle to tap into the booming fashion jewelry segment, which saw a 9% decline in sales, points to potential areas for growth, particularly in gold jewelry, where direct factory partnerships could offer a competitive edge.

Meanwhile, Brilliant Earth's strategy of nurturing brand loyalty through initial engagements, like ring purchases, and expanding its fine jewelry collection exemplifies a successful approach to capitalizing on consumer goodwill and changing tastes.

Brilliant Earth and Signet's contrasting fortunes reveal much about the jewelry market's current dynamics, highlighting the importance of adaptability, consumer engagement, and product diversification in navigating retail challenges.

See more in this video report in Rapaport.

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