January 9th, 2020 – By Galina Semyonova
Oksana Senatorova is the publisher of the Jewelry Trade Navigator magazine and the founder of the Jewellery Business Academy.
She graduated from I. M. Sechenov Medical Academy and the Faculty of Psychology of Lomonosov Moscow State University.
In 2001, she started the Jewelry Trade Navigator magazine, the leading Russian professional publication on technologies and culture of jewellery sales.
She heads the industry projects: the ‘Diamond Street’ almanac – about jewelers who are the future of the Russian jewellery art, and the ‘Top 100. The best jewellery stores’.
She also does a popular jewellery guide series for the trade and a wide range of readers.
She is an organizer and host of the prestigious international contest the ‘Best Jewellery Store of the Year’, an organizer and curator of the Russian jewellery industry seminars on sales and professional jewellery trade events.
She is awarded the Faberge Memorial Fund Award: the Small Decoration of the Order of Perkhin (2010).
In an exclusive interview with Rough&Polished, she shares her thoughts on trade shows, diamond trading and consumer trends.
You visit almost all the jewellery exhibitions: Vicenza, Hong Kong, Astana, JUNWEX … Tell us which of the last exhibitions was the most interesting one?
The September Hong Kong show was very unusual, from the point of view of the situation in Hong Kong, and no less interesting. It took us long to decide – to go or not to go because of the political disturbances there. It should be noted that the politics affected the exhibition: many traditional participants have not come – this was especially seen in the Indian pavilions, and the rotation was also in the premium pavilion.
Interestingly, the local jewellers were on the side of the protesters, although they agreed that politics should not affect global business events.
It is also interesting that the Hong Kong fair consists of two parts and it starts at the AsiaWorld-Expo at the airport – there is a large international exposition focused primarily on semiprecious and ornamental stones, of course, polished diamonds and, a whole slew of all kinds of pearls.
At the main jewellery show held at the Hong Kong Convention and Exhibition Centre, I walked mainly around premium pavilions and stands. The Russian and Italian speech is heard much. But this year, some companies began to curtail their work at the stand somewhat earlier every day than the official closing time of the exhibition. There were many visitors – the audience – but there were no customers, so the exhibitors thought it more efficient not to waste time on looking sadly at each other’s stands. Of course, on the whole, the participants in the exhibition stated that the number of visitors and customers had fallen drastically – which could not but affect the business.
What stands attracted more visitors?
The stands with mass market products. As I said, many Indian companies decided to take no risks and did not come. But, as always, there is a 5th floor where the Chinese manufacturing factories are displayed. There, the work is in full swing, everything is very lively – mass market products, silver items, jewellery with stones … Everything that the Chinese make – both the time-tested classic jewellery and the trendy minimalism – the products are quite high-quality and fashionable. After all, the customers have become more demanding – for 1,000 rubles (about $20) they want to get an exclusive jewellery piece.
Several Russian companies displayed their goods in the International Exhibition Pavilion. Unfortunately, not many ‘stubborn’ visitors were able to find them there. But some of our manufacturers, being more experienced, displayed their things among the Chinese pavilions that are popular with the buyers from all over the world, and they came up trumps. The right place – from a marketing point of view – is perhaps the most important element of the success at a huge international exhibition.
What about diamond jewellery? Are polished diamonds still popular?
The diamond jewellery sales in the mass segment, of course, dropped. The emphasis is more on a steady classic jewellery, which, at least, sells better. The jewellery cost can be various – from affordable to stratospheric prices, but the design, as a rule, does not go beyond the classic one. Interestingly, the price in Hong Kong is not revealed, as they say, it is an agreed, ‘negotiated’ one – I think it depends primarily on the bargaining skills.
I met a jeweler-designer from Europe, who works in Hong Kong. What he makes is not quite a classic jewellery, although he tends towards the classic one, but not the avant-garde one. A very high-end luxury jewellery piece is a 40 carat diamond with an exorbitant price tag, but the design is classic.
What trends could you point out?
First, the today’s customer needs an offer of something unique that others do not have. Now we should target at a narrow segment, at the quite small groups in a narrow circle of interests: the customers should recognize themselves in each advertisement.
Second, the access to the e-commerce. These are the international market places of Alibaba, Amazon, eBay and others. Moreover, the long-awaited changes in the legislation have taken place, allowing the online commerce. So, it’s time to embrace this niche.
One more trend – the customer is no longer afraid of laboratory-grown diamonds. Of course, there will always be supporters of the natural stones, as they have their own emotional component. For example, several Ekaterinburg companies – MOISEIKIN, CHAMOVSKIKH, DEMIDOV, are still committed to natural stones, classic designs and high-end jewellery. By the way, pay attention to the mini-trend: using your own name in the name of the company and building the brand on its founder identity. This approach increases sales due to greater confidence in the brand.
And at the same time, recently, a jeweller who effectively works with grown diamonds told me a story: there is a category of men who buy ‘two jewellery pieces’. It becomes important for them that for the price of one natural diamond you can buy two lab-grown diamonds of the same or even better quality. In addition, there are young buyers for whom the guarantee of the social and environmental ‘purity’ diamonds is important. For the generation Zers, it is important that these are not ‘blood’ diamonds, no child labor was used in their mining and manufacturing, and the nature was not damaged.
Rational purchasing behavior, cautious attitude to own finances lead the manufacturer to a wider use of grown diamonds in the manufacture of budget diamond jewellery. If we take into account the problem of ‘mixing’ synthetic stones to the natural ‘melee’ categories, it may be worthwhile to openly declare and use the grown diamonds, emphasizing that in such a jewellery piece, the ‘pave’ is of perfect selection and quality.
You also conduct training sessions? What are the topics of your seminars?
First of all, these are information technologies and their use in the jewellery trade, as well as the promotion of the jewellery business in social networks, algorithms to be used in the work with customers. Also, we consider real SMM (social media marketing) cases from the jewellery industry and the luxury market.
As for the e-commerce – the analysis of trading platforms, sales channels, promotion of goods, communication with customers, stages of placement on the platforms, and the opportunities for the manufacturing and retail jewellery companies.
And also the topic I mentioned above – a unique selling proposition (USP).
What do you mean by the USP – is it an event related to some dates, holidays, some kind of an exclusive, attractive offer?
A unique selling proposition (USP) is a kind of a special feature, ‘it’.
‘Unique’ means something that competitors certainly don’t have. The seller must offer the buyer something that other stores don’t offer, and not the same goods but ‘in other – for example, yellow – wrapping’.
‘Selling’ means what the customer pays money for. And this is not about service and comfort, because with comfort and promotions you can increase customer loyalty, but you receive money for a unique product.
The ‘proposal’ – this is perhaps the most difficult thing: we have the goods, but we are not able to – or simply do not – offer them (let them guess); or we do offer this item, but it is not available right now…
The question of what people are buying is ambiguous, and often, it is not at all dependent on the price tag, is it?
The choice always exists, and really, it does not necessarily depend on the price tag.
Everyone buys goods he/she can afford: lovers of premium purchases buy in brand boutiques, the middle class goes to shopping centers, the economy purchases are chosen in the Chinese market or at discounters. But the problem of choice is in any segment. It was in the Soviet times that people bought a ‘deficit thing’ that was sold at a given moment, now the choice is becoming less random and more justified. And if the buyer cannot navigate the choice and correlate it with the actual value for himself/herself, the buyer puts off the purchase. So, actually, we do not satisfy the need – we sell a certain value. And it is very important for jewellers and sellers to think about what value their product translates.
Recently, a consumer behavior study was conducted, specifically for the Jewelry Trade Navigator. Tell us about it, please.
According to the parameters we set, Segmento (its shareholders are Sberbank of the Russian Federation and AFK ‘Sistema’) analyzed a data sample that included over 300,000 residents of Moscow and over 600,000 people from the Russian regions. Only the data on the buyers who made a jewellery purchase in 2019 were analyzed.
And what are the results?
Let’s see how the customer data is distributed in the gender segment: in Moscow, 71% of women make jewellery purchases (in the regions, their share was 75%); 29% of men make jewellery purchases in Moscow (in the regions, 25%).
In the age segment, the shares of age groups in Moscow and the regions practically do not differ, and an audience aged 35–44 years is represented in both segments and it is 10% above the average. The same group holds the largest share among all customers. Also, in both segments, there are few respondents aged 18-24 and 55+ years.
By the ‘gender + age’, it is clear that women aged 35-44 make the majority of the audience in both segments. In the regions, the same group is 1.3 times above the average, and in Moscow 1.25 times above the average. Moreover, in the regions, there are more women-buyers aged 45-54 years than in Moscow.
The sample data by income level was divided into four conditional categories by their income level: the main share of jewellery buyers, of course, has an income above the average and a high one. In Moscow, customers are more affluent, the proportion of high-income respondents is greater than in the regions, and almost 2 times more than this share on the average.
I am fond of a dry language of numbers: it allows you to analyze the market in order to competently build your business, spend money rationally on your advertising campaigns and, working for everyone, appeal to each customer almost directly.
There is always a wide range of interests in customer behaviour that can be divided into two large categories. Firstly, these are online interests: we are talking about the customers who have made a jewellery purchase online and are actively interested in other products and services on the Internet. This is about what they were interested in, what they read about, what they saw. It is the people’s interests that you need to know in order to include them in the advertising data sample. Secondly, the customer behaviour really tells you what characteristic spending is made by our customers. Their online and offline purchases were taken into account. We also plan to investigate what the residents of million-plus cities bought, and we’ll analyze the amount and quality of their purchases.
What should be done if the demand is changing – it has shifted from jewellery to the segment of travelling, cars, gadgets?
At the seminar, we asked ourselves: are there fewer buyers with the entry of the generations Z and Y, or is this old luxury becoming a thing of the past? No, it doesn’t go away – just the demand is changing. And the manufacturers will have to work more with young designers who would understand their generation better. And also, to form a culture of jewellery consumption among the young generation. Let the jewellery pieces for them be small, thin and light – the minimalism is welcome. And then, with age, their preferences and demand will change, but jewellery will stay! Yes, it’s not easy now. Did anyone promise that it would be easy and simple?
Source: https://www.rough-polished.com/Disclaimer: This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.