Consumers are increasingly comfortable shopping online for jewellery — more so since the pandemic — and are much more likely to make high-ticket purchases online than five years ago. From 2012 to 2021, online jewellery sales increased by an average of 3.9% each year, with the market expected to reach £21.4 billion in 2022. According to Gartner L2, the share of online sales across the US and Western European jewellery sales doubled over 2019 to the detriment of brick-and-mortar brands. While the UK industry—despite suffering tough trading conditions on the UK high street, not helped by 2020’s lockdowns—still looks to be thriving, largely due to the enduring demand for luxury goods.
But mid-market jewellery brands and retailers are too suffering from declining footfall and consumer uncertainty, and the competition from niche independent brands is rising. Specialist retailers and brands must, therefore, work much harder to stand out from the crowd, avoiding the fate of retailers like Links of London, who succumbed to the threats in 2019.
But despite the fragility of the high street, purchasing of jewellery has gone up: the UK jewellery industry’s projected value in 2022 is £3.3 billion, while the global demand for gold jewellery recovered to its 2019 size in 2021.
Factors cited as contributors to the global growth of the market include a growing number of digital buyers, an increasing female population, an increasing middle-class population and growing tourism. That said, there are challenges in the form of declining rough-diamond mine supplies, e-Commerce fraud and even delayed marriages.
Additionally, new perceptions of prestige (online, virtual and IRL) mean new priorities and opportunities in jewellery for the coming years. Yes, that means NFTs, AR and the metaverse.
So what jewellery market trends can we expect to see in 2022 and beyond? How can brands understand the drivers and behaviours from different demographics in order to form effective growth strategies?
Top Jewellery Market Trends: 2022 & Beyond
NFT Drip: Jewellery’s New Frontier
2021 was the year that NFTs and the Metaverse caught fire. During this time, Facebook changed its name to Meta, NFT sales grew from almost zero to £30B in total sales (almost as much as the global market), and any company that sells online was forced to examine what NFTs and the Metaverse might mean for their business in the future.
The hype surrounding non-fungible tokens (NFTs) – digital tokens of blockchain-registered ownership – is spilling into jewellery with an increasing number of brands jumping on the trend, from indie cool kids to established major players, including British jeweller with a royal warrant, Asprey.
“NFTs are perfect for us, because they capture everything about the product, forever, when the information is part of a blockchain,” Asprey’s executive chairman John Rigas tells Vogue Business.
Asprey will launch both digital physical pairs and a line of digital-only NFTs, in a move that Rigas believes will bolster the authenticity of Asprey products, documenting their ownership history and guaranteeing their authenticity.
NFTs for Authenticity
To this end, Richemont, Cartier’s parent company, along with LVMH and Prada Group, recently unveiled the Aura Blockchain Consortium, which employs blockchain to trace a luxury good’s product history and authenticity.
Not for consumer sale as a luxury good, Aura NFTs are created to track information only, such as jewellery in for repair and diamond traceability – progress also seen at blockchain-Based Diamond NFT Marketplace, Icecap. Using Ethereum-based NFTs to represent ownership of individual diamonds, Icecap allows owners to trade the tokens without friction while the diamonds are vaulted, insured and periodically audited.
This new type of marketplace for diamonds is selling NFTs that include “investment-class” diamonds, offered between $5,000 and $15,000, and rare pieces, such as a necklace featuring a 70 carat diamond offered at $3.6 million and a ring featuring a rare purplish-red diamond offered at $3 million. (Vogue Business)
“With NFTs, we can make a tradeable representation of the diamond on the blockchain, which can then be freely traded while the diamonds remain safely in a vaulted environment,” explains Icecap CEO, Jacques Voorhees. “In this way the diamond can be bought and sold at the same price level, which thus creates a two-way, publicly accessible marketplace for investors.”
Abu Dhabi-based decentralised technology firm Ammbr has been listening to the NFT chatter too, and has responded by partnering with Bangalore-based Toqn Modular Jewellery to launch an NFT jewellery collection, a move echoed by both Simone Faurschou, who has unveiled a fine jewellery collection in digital format to marry with physical pieces and Myka, a Canadian brand selling limited edition, customisable NFTs based on a hand-drawn illustration of the chosen jewellery design that pair with a physical product.
Chains is trying to break through the blockchain, too, extending the reach of its blinging jewellery beyond the digital realm and into phygital, as well as creating the Metaverse's first luxury jewellery outlet, with a digital boutique packed with opulent accessories. Chains promises further perks, such as passive income from sales generated at Chains' Sandbox shop and exclusive IRL "Holder’s Only" events at hotspots around the world.
NFTs for Community
NFTs can be used as a phenomenal way to build community. Consumers don’t always want to engage with a branded physical product, they want to experiment with NFTs too, which can be flexed in various games or worn in metaverses, such as Decentraland.
For jewellery brands, NFTs can be an easier and sometimes lower cost way for consumers to engage with a brand, as seen at Gucci, which launched a virtual shoe retailing at just $9. It’ available for virtual try-on and users have up to 25 customisable options.
A bold move, this is an ultra-accessible entry point to the brand which has potential to win over a legion of new fans.