Danish company leads a paradigm shift as traditional jewelers ignore them at their peril
LuxuryÂ jewelry marketers: What does your business have to fear from PANDORA, the Danish company specializing in customizable charm bracelets, rings, earrings, and necklaces?
If you answered anything other than “plenty,” you may want to take a second look.
In Unity Marketing’s latest Luxury TrackingÂ survey conducted in January 2012, PANDORA emerged as the second-ranked luxury jewelry brand, trailing only traditional luxury jeweler, Tiffany. This fits right in with the company’s stated goal to become “the world’s most recognized jewelry brand.”
But at a recent conference I attended, a panel of jewelry designers all said they felt no impact of PANDORA on their businesses. They may want toÂ put their ears a little closer to the ground, because PANDORA is gaining on them and is poised to be a game-changer in the luxury jewelry industry.Â
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Â PANDORA’s design-your-own approach is custom-tailored for the modern luxury consumer
PANDORA is a paradigm-shifting jewelry brand, giving customers the ability to design their own jewelry pieces with each additional charm added to represent moments and memories in the person’s life.Â This approach dovetails nicely with the current economic climate and luxury consumer behavior in two ways:
- First, luxury consumers consistently report valuing experiences over physical possessions when they make a purchase of luxury.Â The PANDORA jewelry fits right in by allowing luxury consumers to pick pieces with meaning for them to commemorate a special experience. Plus they get the experiential thrill of designing their own unique jewelry piece.
- Second, the unique nature of the pieces means that it is highly unlikely an affluent consumer will see herÂ jewelry expression on the arm of another.Â This is critical in this time of increasing class warfare and backlash against the rich, when an identifiable piece of luxury jewelry that obviously comes from an expensive brand may make a tone-deaf statement in a climate of continued economic uncertainty.Â PANDORA jewelry allows the personality of the wearer to be more important than the branding message.
The rise of PANDORA is not unique.Â In the luxury market, competition is coming from unexpected places.Â Just because your brand is “luxury” doesn’t give it immunity from non-luxury players or a guarantee of keeping your affluent customers.Â Mass brands – like L’Oreal Paris, JC Penney’s, Ann Taylor, and Amazon.com — are all getting more than their fair share of sales among luxury-leaning affluent consumers.Â Today’s luxury marketplace must compete for affluent consumers not only among luxury brands but from savvy high-quality mass brands as well.Â (You all remember seeing Michelle Obama recently looking stunning in her melon coat from Ann Taylor.)
Â Take heed of PANDORA’s example and customize your own jewelry brandÂ
PANDORA saw its sales double between 2009 and 2010, a dramatic result of its core strategy. CEO Mikkel Olesen writes, “We believe that providing our customers with high-quality, hand-finished, modern jewelry – made from genuine materials and at prices they can afford – is the soundest way to ensure our customers stay with us.”
PANDORA clearly understands its target consumers, and every luxury brand must do so in order to be truly competitive in a world in which being an identifiably affluent-oriented brand can be as much a liability as a benefit. To help you navigate this new terrain, you can take a number of steps:
- Read my book, Putting the Luxe Back in Luxury. This is a great start to understanding the changing behaviors of the affluent consumer and to finding inspiration among some of the most successful luxury brands which are thriving in the changed economic environment.
- Order The Jewelry Report 2011. This report will help you delve deeper into the jewelry marketplace to understand what jewelry consumers want and how you can provide it. This concise and cost-conscious reportÂ is written specifically for jewelry retailers and marketers that want the most up-to-date and salient facts to help them understand the trends in the current market for jewelry, including jewelry buyers’ shopping preferences, behaviors and attitudes. Â This report will help jewelry marketers challenge their old strategies and create new designs at new price points to be sold in new ways.
- Subscribe to Unity Marketing’s Luxury TrackingÂ study to keep your finger on the pulse of the luxury consumer market. Every three months Unity Marketing conducts a survey of 1,250+ luxury consumers across the entire luxury market to give you a top level view of consumer behavior in regards to 22 different categories of luxury goods and services, including luxury jewelry and watches. Plus every quarter it digs deep into preferred brands, favorite store types, and how affluent consumers are spending their money. This is the most in-depth report for the marketer who really wants to gain the competitive advantage by understanding the entire marketplace.
Or, give me a call. I would be happy to help tailor a solution for your business that will give you the kind of advantage you admire in game-changers like PANDORA