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Is digital transformation part of your business strategy this year? Retail jewelers are going digital. It’s an inevitable route to the future, so if you’re still in the digital dilly-dallying phase, we’ve got more reasons for you to haste the shift.
In 2020, an alliance of leading retail jewelry providers and organizations surveyed the jewelry industry landscape to get a clearer view of how the industry was managing the digital transformation in the middle of the pandemic. Did you know that 49% of polled jewelry businesses were closed for 2 or more months last year? This figure highlights the undisputed importance of digital technologies not only in the current market situation but more importantly, in your future dealings to cushion your business in cases of emergencies.
What is Digital Transformation?
Digital transformation is the process of integrating digital technologies into all areas of your jewelry business. That said, it’s more than just about technology. As these technologies were driven by customers’ changing expectations and preferences, the digitalization process must deliver more value to them by bringing not only operational efficiency gains but also enhancing customer intimacy. Otherwise, the transformation won’t be as successful as you expect it to be.
But how does this whole digital shift impact the jewelry industry?
The Jewelry Industry in the Time of Pandemic
The concept of going digital is not new. In fact, the discussions around digitalization have begun since the internet first sashayed into our lives, but different industries have different adaptability levels — some instantly have the mindset to change, others have been slow but still dipped their toes into the omni-business model, and then there are the skeptics…until the pandemic.
An eye-opener for many industries, particularly the jewelry industry, which did not escape its fate. What was the fastest-growing category in the luxury industry pre-pandemic was among the first to take a hit as growing consumer fears, mandated closures and mobility restrictions forced jewelers to manage their stores more efficiently…or NOT. In the first few months after the first lockdown, we saw jewelry events canceled. Some stores fell into pandemic bankruptcy while others had to cut staff and reduce work hours to minimize expenses just to keep the business afloat.
In fact, in the Jewelers Going Digital survey, the president of the Jewelers Board of Trade concluded that the jewelry businesses that were left struggling due to the pandemic were those without online presence and lacked e-commerce capability. On the other hand, those with an online presence reported an increase in online store traffic; thereby, pushed them to post more on social media, resort to visible online inventory, and enable online purchases.
Surprisingly, despite the digital space’s ray of hope, some jewelers actually did not make any changes at all. Additionally, almost 30% of those polled jewelry stores stopped advertising altogether and just watched their sales do a nosedive.
If this is not a warning enough for jewelers to not undervalue the importance of digital channels, I don’t know what is. So here are a few more reasons why retail jewelers should go digital, especially in the post-pandemic world.
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3 Reasons why Retail Jewelers Should Go Digital
1. Online interaction translates to sales
Surviving is good but thriving is better.
With the industry facing a cauldron of challenges and uncertainties, it won’t work if you continue to maintain the status quo. To rise above the challenge, you must learn to operate in the intertwined online and offline digital world. Currently, there is a growing online interaction and engagement between customers and sellers. A digital-savvy jeweler can leverage this environment by engaging with jewelry customers right where they live — in their homes on their smartphones.
In fact, increased interaction and engagement with customers online could easily translate to sales. Evidence of this is the unsuppressed online purchases of jewelry during the pandemic.
According to the survey by The Plumb Club Industry & Market Insights 2021, 30% of polled consumers bought more jewelry during the pandemic and 49% bought jewelry at the same level as they did pre-pandemic, while only 21% experienced the pandemic’s negative impact on their jewelry purchases.
Jewelry as an Experiential Purchase
Many probably thought that jewelry shoppers would take a break from buying jewelry pieces in the middle of a public health emergency. After all, everyone was confined at home. With public gatherings still restricted, there wouldn’t be a lot of reasons to accessorize. You thought that jewelry would take a hit as purchases shift from material to experiential, but jewelry is an experience. It is personal and symbolic. Why do you think was De Beers successful in marketing diamonds as a forever thing?
The statistics say it all. In the same study, 39% of consumers said that spending time at home had inspired them to buy more jewelry online and so, they did. Translating inspirations and desires into action, 72% of polled consumers had actually bought more jewelry on different online platforms.
If you’re not online, how are they going to buy from you?
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2. Digital transformation builds resilience
What immediate action did you take to ensure that your jewelry store could continue to operate under a crisis condition?
Are you in the process of making the turn, already ahead, or still struggling to catch up? If we are to base this on the survey by Jewelers Going Digital, it’s clear that those who struggled the most had no online presence, and consistently resisting the need for change could highly likely lead to permanent store closure.
Many of you are probably scared to leap beyond the traditional territory. This is understandable. New things are always scary, but when investing in digital technologies, you are investing for the present and the FUTURE.
Future-proofing your jewelry business through digitalization is imperative to help mitigate the impact of the economic downturn. With the right tools and systems, you can continue to serve and support your customers, and in the process, support your employees, too.
When tackling the need for change, digitally, remember the following.
- You can embrace change without damaging your jewelry business.
- To come up with a sound digital strategy, everything starts from a clear assessment of the problem — internally and externally.
- You don’t need to reinvent the digital processes when building an online presence or starting your e-commerce page. There is no need to break the bank.
- Look for external sources. There are many e-commerce platforms like Shopify, Magento, and WooCommerce, among others, that make online store setup quick and easy; thereby, allowing you to enable and manage online purchases in a less complicated manner.
- Maximize free online resources.
If you’re already online, good on you! If it makes you thrive today, it’s your key to thriving in the future. Your digital fitness today will determine your future jewelry business successes.
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3. Changing sales channels
2021 has ushered in new sales channels, jewelry shopping behavior, and jewelry trends. What, with video chats and Zoom meetings dominating people’s work and social lives, you bet people have found new ways to accessorize themselves — from beaded face masks to beaded face mask holders. Along with this trend comes the rise of new sales channels like Zoom, live video selling on different social media platforms, and online jewelry trade shows and exhibits.
Last year, we saw the rise of first-time online shoppers. According to BCG, the pandemic has led to a 14% and 17% increase in first-time online shoppers in the US and China, respectively. This figure is a clear indication of the accelerated digital transformation and shifting sales channels.
If you’re not familiar with these new channels as customer touchpoints, then these are new opportunities that are there for the taking.
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Jewelry Digital Transformation: The Future is Now!
They always say that the future is digital, but the future is now. It’s here and it’s asking you to decide for your jewelry business. Jewelry retailers need to make this decision now; otherwise, other people will decide for you. It’s a die or thrive.
As the world recovers, there’s no going back to the old normal. Welcome to the digital world. This is a revolution!