In today’s waning yet tightly contested market, jewellery retailers do well to stock high profile, exclusive brands backed by large marketing spends. But reaping the rewards of branded jewellery takes a lot of commitment, and hard work – retailers must satisfy the strict visual merchandising and presentation demands of brand suppliers. The very close alliances required to stock these brands can turn any store into a surrogate franchise.
Highly-branded jewellery and watch lines have a global identity to uphold, an image that must be immediately identifiable no matter where it’s being sold. This puts the onus on retailers to invest in the infrastructure and staff needed to realise the promise of branded riches – especially those brands coveted by young, cashed-up consumers who associate their whole identity with that brand.
“Any international brand will try to have a consistent message and story,” asserts Phil Edwards, managing director of Thomas Sabo distributor Duraflex. “It’s expected that all consumers looking for the brand will receive the appropriate message, story and experience.”
With global celebs like actor Adrien Brody backing the Thomas Sabo range, it’s no wonder this brand manager demands full focus from retailers. “Brands should be presented in only one clearly-defined section of the store so they can maintain their own identities, and also not to confuse the consumer,” Edwards insists.
This is especially so of a brand represented not only by independent retailers but also by over 120 Sabo-owned stores and “shop-in-shops” around the world.
Brand demands
“We have to be very careful and respectful of what a brand is,” advises Barry Urquarht, a business strategist, consumer analyst and managing director of Perth-based Marketing Focus. Brands today amount to a “belief system”, a set of values binding consumers, the manufacturer and the retail network. Any inconsistencies in brand presentation will “breach the integrity” of these beliefs and values.
“Brand management is really about managing consistency and continuity throughout the entire supply chain,” Urquart confirms.
Urquarht reminds us that it’s in a retailers best interest to invest time and energy into the visual merchandising and point of sale presentation of a respected brand, especially in an era of “relationship marketing” when consumers build lifetime alliances with brands and form identities around products.
“Brands spend a lot of money to create a consumer demand,” asserts John Papaioannou, managing director of Bulova, Jag and Fiorelli watch distributor Time Essentials.
This is no longer a retail model based on good will and strong store identity.
“Of course, there are retailers who have developed a loyal consumer base that go to the store for the service and positive experiences they have had in the past but, predominantly, the consumer is driven by the brand they want,” Papaioannou says.
Collaboration
Larry Porter, chief executive of Bolt International, supplier of the much-hyped Ice-Watch in Australia, believes retailers are now fundamental to the success of brands. “Stores are a critical partner in delivering the brand to the consumer. In many instances, this will be consumers’ first interaction with the brand.”
To build better, more profitable brand strategies, brand managers and retailers need to develop a more integrated partnership. Porter does this by providing retailers with the merchandising, point of sale and brand training tools to maximise the brand. This helps retailers convey an “on-brand message and an experience the consumer will enjoy”.
Indeed, there’s been a fundamental change in the nature of relationships between retailers, manufacturers and suppliers. “It now must be a strategic alliance of equals,” Urquart explains. “We must each recognise, respect and utilise the respective brands that constitute that alliance.”
Brand managers must also recognise that retailers have their own needs and limitations, which won’t always align with the dictates of the brand.
Edwards acknowledges that suppliers must work “within the limits of the local retailer”.
Porter agrees. “I don’t think it is reasonable to put demands on retailers in today’s environment,” he says of the current precipitous retail market. “One needs to understand the pressure on retailers today is extreme and we are very sensitive to their needs.” Porter will only encourage retailers to expand the brand in-store once “we have put the runs on the board”.
Without the luxury of brand-only stores, brand managers are reliant on retailers in this market. While it’s in the retailer’s interest to ensure that brand presentation remains faithful to supplier expectations, retailers also have the power to maintain their own identity.
“The retailer still controls the mix of brands in their store and the emphasis on each brand through the range size and position within the store,” says Stephen Brown, general manager of RJ Scanlan, which supplies Trollbeads and the Dora International jewellery range.
Brown encourages retailers to put their stamp on shop design and window presentations that highlight the “feel” of a store, while staff communication and customer promotions must also reflect store identity.
“No one asks a retailer to change their identity just to carry the brand,” Papaioannou specifies. “What we ask is to work together so that the brand is presented as the guidelines require, within the framework of the store. While some brands push the envelope and require very substantial presence, this can be done in a way that maintains the balance of the store identity and the brand’s individual requirements.”
For brand managers, the key is to choose the right retailer – “You cannot put a square peg in a round hole,” Papaioannou says. This is important since suppliers who fail to fulfil brand guidelines risk losing the distribution rights for that brand.
Conflict of interest?
This near symbiotic relationship between retailers and brand managers inevitably gives rise to some thorny politics. For example, what should a brand manager do when an existing client moves into the same shopping centre as another valued retail partner and both want to exclusively represent the brand?
“This will be subject to any existing agreement and how the brand views it own exclusive territory arrangements,” Edwards advises. “If the first retail partner in the shopping centre is representing the brand in a professional manner with integrity and success then the new client moving into the centre should not be allowed to stock the brand in that centre – irrelevant of any prior existing or current relationship in other territories.”
Any retailer would expect this treatment if the situation was reversed, Edwards adds.
“It’s not easy!” says Papaioannou of this scenario, reasoning that commonsense must prevail over absolute exclusivity. If the existing centre retailer isn’t properly supporting the brand and the new retailer is prepared to better represent the supplier, then the decision is easy. But if both retailers are valued clients, a process of conciliation will ensue. Maybe both will be happy to stock the brand?
“If not, and we deem that the there should only be one retailer of the brand in the centre,” Papaioannou adds, “then we inform the new retailer that we cannot supply them.”
The trick is to be consistent and not to play favourites.
Brand or bust
While retailers are under pressure to perform, sometimes the distributors do get it wrong. “I am not absolving suppliers of any blame here,” Papaioannou says. “We have to make sure that we are efficiently servicing the retailer and being flexible where necessary – it is a two-way street.”
Still, many retailers either don’t have the time, staff resources or commitment to comply with the rigours of contemporary brand marketing. “There are still too many who think their only requirement is to make the space available for the brand and that it should “sell itself”, Papaioannou says. “These retailers are doomed and the evidence is seen every week as more and more close.”
Brown is more sanguine, noting that RJ Scanlan has developed strong relationships with retailers for over 35 years. Retailers mostly understand that “conformity is required with strong brands”, and that consumers demand the “full brand experience” when visiting a store. “If a retailer isn’t representing the brand correctly, the consumer will shop elsewhere,” he says.
Retail experts like Urquart believe that customers are inclined to “retreat” to brands that they know and trust when consumer confidence is declining. “At a time like this, there should be a premium assigned to brands,” he says.
Urquart describes the success of the Apple store, arguably the most successful retail space in the world today. Why? Because all recognise and associate with the brand from the moment they see the store, plus consumers know exactly what they are going to get.
Best of all, these brand devotees will never ask for a discount. If this is the model that most good jewellery-brand managers are trying to emulate, it will be worthwhile for retailers to get on board.
The power of one
When retailers and brands represent a united front, anything is possible.
“At the end of the day, perception is reality and, if the brand is merchandised as recommended, it results in a higher rate of sale,” Porter says. Not only that, but consumers “feel good and enjoy their purchase experience.” This means repeat custom, something “good for both suppliers and retailers,” Porter concludes.
How can retailers and brand managers work constructively together to build stronger brands that exceed customer expectations in unique and compelling ways?
“Never stop talking with each other and never stop listening to each other,” Edwards says.
Jo Tory of sterling silver jewellery brand Najo, agrees: “Working closely together is fundamental. The relationship between retailers and suppliers should be a kind of partnership where the needs of both are considered.”
Brown advises that jewellers need to work with brand managers to develop numerous marketing strategies that can best build brands at retail level, such as “co-operative advertising”, inspired visual merchandising, in-store light boxes and store promotions that enhance
“brand recall”.
The right staff training is also of crucial importance.
“Many consumers have researched the brand before they walk into the retail store, so ensuring that staff know the brand backwards and know more than their customers is vital,” Brown says.
Such collaboration can only happen through superior trust and communication, often easier said than done in a tough retail climate that can inspire paranoia.
Brown claims that retailers can often complain about a lack of loyalty when a brand is stocked – for “good business reasons” with a competitor. But such loyalty is often not reciprocated; retailers have been known to introduce a competing range into their store without consulting the existing brand supplier, Brown says.
These issues need to be raised and resolved if retailers and suppliers are to get the best out of brands together. While the burden might be on retailers to invest the time and effort to win the right to stock high profile brands, the supplier must also bring something to the table.
“With a new brand, the onus is initially on the brand to prove themselves to the retailer,” Porter argues. “We are extremely active in supporting our retailers to drive consumer awareness in-store and once these results bear fruit, our retailers embrace the way we do things.
Those who work closely with the brand on sponsorship initiatives, in-store promotion, advertising and charity affiliations rank as our best performing stores.”
Some retailers might disagree, arguing, as Brown notes, that suppliers are adept at ending accounts and changing stockists when it suits them. Such was alleged when Pandora shut down 100 accounts in Australia in 2011.
Pandora Australia managing director Karin Adcock tried to head off the backlash, stating the brand had “worked tirelessly on introducing a retail concept where multi-branded retailers could upgrade their presence with the Pandora brand. Many stores have embraced the initiatives; however, the concept is not for everyone.”
In the current market, brand managers have to make some tough decisions. If retailers cannot produce the consistent brand experience that today’s consumers demand, then the integrity of that brand will be damaged and suppliers will need to move on for everyone’s benefit.
With enough transparency and positive collaboration, however, retailers and suppliers can equally exploit the power of branded jewellery.
In today’s waning yet tightly contested market, jewellery retailers do well to stock high profile, exclusive brands backed by large marketing spends. But reaping the rewards of branded jewellery takes a lot of commitment, and hard work – retailers must satisfy the strict visual merchandising and presentation demands of brand suppliers. The very close alliances required to stock these brands can turn any store into a surrogate franchise.
Highly-branded jewellery and watch lines have a global identity to uphold, an image that must be immediately identifiable no matter where it’s being sold. This puts the onus on retailers to invest in the infrastructure and staff needed to realise the promise of branded riches – especially those brands coveted by young, cashed-up consumers who associate their whole identity with that brand.
“Any international brand will try to have a consistent message and story