I met Hedda Schupak for the first time while exhibiting at the American Pavilion in Basel Switzerland in 1995.
We crossed paths many times after that, but more recently, I have run into her at the Centurion Show and as editor of The Centurion Newsletter.
Hedda has the biggest press resume imaginable. She was JCK’s editor in chief for a decade, has covered trends for more than two decades, and has been inducted in the WJA hall of fame in addition to receiving several awards, including being named one of Pennsylvania’s Top 50 Women in Business.
Josette: You have been in the jewelry industry long enough to notice the big changes that are occurring with each day. There is a blurry line when it comes to fine jewelry, an explosion of new designers, and pressure to grow with financial backing with little to no buying commitment from retailers. What do you attribute all these changes to?
Hedda: I think each change has its own roots and you can’t make a blanket statement that will cover them all, except to say that the only constant is change, and that the rate of change in the world keeps getting faster. But your other questions address a lot of the reasons behind these changes and what will continue to change as we move forward, so let’s dive in!
Josette: How would you advise young talents to start a jewelry business?
Hedda: One of the things that attracts people to this industry is the relatively low cost of entry compared to other industries. For example, opening a restaurant is a lot more costly than launching a jewelry line, where your only real cost is your tools and materials. The rest comes down to sweat equity and an innate sense of being in the right place at the right time with the right product. That’s the talent part—the secret sauce that sets apart a successful new talent from just another good goldsmith. You can be an exceptional craftsman but if you don’t have the right sense of the market or an ability to convey it to the right influencers, you’ll have a harder time establishing yourself.
The best way to get a sense of the market is to be a keen observer of everything: read, watch, and learn as much as you can as often as you can, but some people are just innately better at sensing what’s on the horizon, while others come in only once the trend peaks.
The hard costs of marketing a collection have come down with the advent of social media. It’s not free, but you can get a lot of buzz among bloggers and editors without buying a huge ad program.
If you aren’t inclined to pound on doors to get influential bloggers and editors to notice you—and you don’t have the money to pay a good PR representative to do it for you—one way you could get yourself established is to try and align with a good retailer in your town as their in-house designer, and work your way up from there to bigger markets. You also should enter as many jewelry design competitions as you can to get visibility and, in some cases (such as Centurion’s Emerging Designer Competition), you can possibly even win exhibit space at a trade show.
Josette: A large number of jewelry designers have opted to open stores and sell directly to the consumer. Do you see this growing trend as a brand strategy or a need to be more creative, more personal with the consumer?
Hedda: I think it’s both. I began discussing this trend many years ago when I was chief editor of JCK. It’s a trend that crosses many categories—apparel, electronics, beauty, and jewelry.
Brands use their stores as a marketing vehicle as much as a retail outlet. It’s a place where they can tell their story the way they want to tell it, present the product exactly as they intended it to be presented, and build a level of loyalty and personal contact with the consumer that may not be possible in a multi-brand environment. This also applies online as well as in brick-and-mortar locations.
Conversely, a multi-brand retailer uses its own name and reputation as the brand and relationship builder with clients. For example, Nordstrom’s Rewards loyalty program and great service keep customers coming back again and again, or cooking classes and demonstrations at stores like Williams-Sonoma or Sur La Table build a following among foodies who will then buy a wide variety of brands of cookware in the store.
Retailers often find that sales of a particular brand go up, not down, when a branded store opens in the vicinity. Contrary to popular belief, branded stores don’t always carry the entire line soup-to-nuts, and brands still will produce exclusive pieces for their retail dealers that aren’t available in the company store. Branded stores also typically sell at full price, so a discount-oriented shopper is more likely to find a lower price at a retailer other than the company store. And if they have reward points at a department store, they can use them toward a purchase of that brand.
I think once consumers have seen a brand in its own environment, they’re more receptive to it in another environment. Retailers that have a loyal following among customers won’t lose those customers to the branded shop. It’s an ideal way to fuse the brand experience with what they’ve come to love about you.
Josette: As a market analyst, how would you advise retailers and designers alike to reach out to the millennials?
Hedda: I think the key is to stop thinking about luxury in terms of cost and materials, and start thinking about it in terms of relevance to lifestyle. The market is facing a seismic shift in how consumers—especially Millennials—think about luxury.
Again, back when I was at JCK, I gave a lot of seminars about targeting the female self-purchase customer. The high end of our industry didn’t have enough products to compete in the same price space as luxury handbags and shoes, and I believe we left a lot of money on the table as a result.
Now we’re targeting Millennials, but the same issue remains: we still don’t have enough products with a high-end sensibility at a price that competes with bags, shoes, and iPads. There’s more than there used to be, but not nearly enough.
Boomer fashion magazines touted “investment dressing,” but Millennials grew up churning both their clothes and electronics over continually, and they’re more inclined to mark life’s milestones with an experience than a physical talisman. In previous generations, most people aspired to have the big house, the fancy car, and all the stuff that goes inside. But compared to Boomers, Millennials are more interested in filling their minds with experiences than their homes with stuff.
Yet we want to sell them something very expensive on the premise of wearing it for a lifetime to justify the value. I recently asked De Beers’ CEO Philippe Mellier how to sell forever in a disposable world. He replied that there’s room in Millennials’ heads for both fashion and forever.
I think he’s right. But the key word is both—while for the most part, our industry is focused on selling only the forever.
Right now the Boomers are still carrying the market, and they will be for at least another decade or more. Jewelers don’t feel an urgency to change how they merchandise because their numbers are still quite good, and manufacturers don’t feel an urgency to change because their retailers aren’t demanding it. Nevertheless, we should look at the long-term picture sooner than later.
Luxury today is a style, not a price tag, which means jewelers should consider adjusting their merchandise mix to include both fashion and forever. It doesn’t mean giving up the costly forever pieces, but rather to increase your selection of products priced to compete with luxury bags, shoes, and iPads. Give the customer both something to aspire to and something they can afford on impulse.
Millennials do appreciate traditional luxury. But they also want modern luxury options, which means finding a way to serve both the Alex & Ani customer and the five-carat diamond customer, not just one or the other.
Here’s an easy way to think about modern luxury: Apple occupies the luxury position in every category in which it competes. You may not think of a $400 iPad or iPhone as a true luxury purchase, but compared to all tablets or all smartphones, the iOS device is the luxury option. So instead of comparing Alex & Ani to a diamond, compare its market position to other brands in its space.
Even if the woman carrying a $2,000 handbag can afford to spend twice as much on jewelry, she might not want to at that moment. Instead of only trying to sell her up, give her lots of choices and a great shopping experience for the amount she wants to spend now. Instead of considering the time it takes to sell a $35 bead as wasted because it wasn’t spent selling a diamond, think about finding more products to keep Millennial customers coming back again and again for something new, just like they do for clothes and mobile phones.
Hockey legend Wayne Gretzky once said that what makes him great is that he skates where the puck is going, not where the puck is. So instead of trying to make Millennials want to buy what we want to sell, let’s go where they are and sell what they want to buy.
Thank you Hedda! It is always a pleasure to see you at the trade show. You are and have been an inspiration to a lot of us in the jewelry industry.