Apple, Microsoft and Coca-Cola were ranked the world’s top three most valuable brands by US wealth magazine Forbes last year, mostly due to their ability to offer a desirable product and project a specific lifestyle, experience and emotion.
Marketing gurus continue to preach that such value propositions are key to creating a successful brand and it’s something that many businesses specialising in jewellery products have also managed to master, even if it did take them a little longer than the rest.
The industry may have been slow to adopt a branding mentality but jewellery brands are now a force to be reckoned with; take a quick look at the buoyant financial reports for Pandora and Tiffany & Co for evidence of this.
Branded jewellery has also achieved pleasing results for both suppliers and retailers in the local market for a number of years, but behind the attention-grabbing on-trend product offerings and colossal advertising budgets is another type of branding that perhaps gets overshadowed – the store brand.
Although there are definitely benefits to stocking high-profile products – the ability to entice customers through the door is at the top of the list – Peter Ryan, retail expert and director of Red Communication Australia, explains that product will only get a retailer so far.
“You [the retailer] will not survive as the stocker of other people’s brands,” he says, adding, “Your brand needs to mean something. What is it? What is the value that you add as far as the customer is concerned?”
Ryan’s comments are made in the context of a changing retail environment where competition is fierce, options seem endless and a consumer’s purchasing decisions are increasingly price-driven.
“There’s no free money today. Customers are only going to give you extra money if you add value.”
These sentiments are not lost on the local suppliers of branded jewellery. In fact, helping retailers to add value and build relationships with their customers appears to be a major focus.
“In order for retailers to develop and maintain customer loyalty, it is critical that they use a variety of means to consistently share product and brand information to generate future purchases,” Helen Hagerty explains as sales and brand manager of Julie Sandlau Australia. The brand recently commenced a national public relations campaign that will be supported at retail level with staff training, digital marketing, local advertising support, in-store promotions and point of sale (POS) material.
Justin Veil, general manager at Designa Accessories, also stresses the importance of maintaining frequent communication with customers, adding that electronic digital marketing (EDM) campaigns is one effective way to achieve this.
“If retailers have a database of their own, we have the ability at Designa to create customised EDMs for them to share with their database,” he says, adding, “EDM’s can also be tailored to our retailers’ specific needs and are a great way to call out exclusive promotions including Gift With Purchase offers.” Designa distributes a wide range of watch and jewellery brands including Guess, Hot Diamonds and recently acquired Trollbeads.
For Najo managing director Jo Tory, building consumer loyalty begins when staff display good product knowledge – something that the brand supports retailers with by providing staff training.
When it comes to assisting jewellers to create their own store brand, Tory believes collaboration is a defining factor especially when creating promotions, advertisements and even collections.
“We listen to our retailers and respond to their suggestions or requests of certain designs or collections that they would like to see in their stores. Very often I will develop designs along those lines,” she says.
Tory’s comments reflect a fundamental change that has occurred in recent years regarding the nature of the relationship between retailers and suppliers and/or manufacturers of branded jewellery.
Suppliers note that forming a strategic alliance with retailers is key to reaping benefits for both parties. This means delving beyond simply where their own brand fits in to assist jewellers with their overall business.
“One of our focus areas at present is to ensure that our multi-branded retailers are ‘equipped’ for competition in this market,” Pandora Australia president David Allen explains. “Essentially, we aim to offer assistance to these Pandora retail partners by sharing what it is that we understand to be ‘best-practice’ in the field.”
This strategy involves providing training in relation to retail management and leadership, as well as “delivering what is ideally a transferable skill-set that retailers may take back to, and apply to, their own businesses”.
Phil Edwards, managing director for Duraflex Group Australia (DGA), which supplies Thomas Sabo and Nikki Lissoni, says his business is committed to ensuring the overall success of the jewellers who stock DGA products.
“The focus for DGA is to work together with our retail partners to grow their business, because our success is measured by their success,” he says, adding, “DGA offers both branded and un-branded product as profit solutions to capture the widest possible market.”
Similarly, Georgini managing director Gina Kougias explains, “It is very important to assist retailers [to strengthen their business] as the stronger their business model is, the more growth they can achieve and the more the business will grow across all ranges.”
These comments might seem like common sense but it wasn’t long ago when there was perhaps a perception that brands were more concerned with distribution numbers rather than the overall welfare of a retailer, a line of thinking that is now outdated.
“It is our mission to make it easier for our partners to run a profitable business and the success of our retail partners directly impacts on our own success,” marketing and product development manager Lida FitzGerald says of Story Jewellery Company.
“Customers are always looking for something fresh, something different. Introducing them to new season ranges, asking them questions and listening to their answers are the basis for the service that brings them back,” she advises.
Opportunity or threat?
It’s clear that suppliers are making a concerted effort to help retailers build relationships with both new and existing customers. In fact, the relationship between branded supplier and retailer seems almost symbiotic, certainly harmonious, at least to a point. That point is the introduction of brand-owned stores, also known as concept, boutique, flagship and mono-brand stores.
Leading the way in this arena is Pandora, which operates a significant number of brand-only outlets. The brand infamously amended its business model in 2011, shutting 100 retailer accounts and opening the concept stores.
While Pandora understands that changes to its concept and multi-branded store ratios in the local market may appear threatening to independent retailers, Allen explains that the outlets are actually beneficial for all stakeholders.
“Pandora’s concept stores elevate the brand in the eyes of consumers and offer a branded experience. They showcase the full range of Pandora jewellery items and showcase the latest in visual merchandising, raising brand awareness and elevating brand perception,” he says.
According to Allen, these elements serve to entice new customers in store and improve loyalty “and our multi-branded Pandora retail partners are able to leverage from this”.
Other high-profile brands in Australia and New Zealand have also embraced a similar strategy.
Thomas Sabo celebrated the launch of its eighth brand-only store in Australia in May. At the time Edwards told Jeweller that the company’s focus “remains firmly on our retail partners nationally and partnering with them to grow their business with Thomas Sabo”.
When asked how company-owned outlets affected Thomas Sabo’s more-than-300 Australian independent retailers, Edwards said that they had had a positive impact.
“Thomas Sabo boutiques [brand-only stores] create an ideal brand statement and generate significant brand awareness,” he explained back in May. “Since the opening of the flagship store [QVB, Sydney] in 2009, we have seen significant growth of the brand in Australia.”
Kougias has a similar attitude towards Georgini’s two brand-only stores, which are located in Westfield Sydney and Westfield Parramatta.
“The flagship stores are in fact a great way to advertise and promote the brand and therefore increase customer awareness, which in turn will benefit all of the brand’s retailers,” she explains.
In addition to enhancing consumer awareness, Ryan advises retailers to use such outlets as an opportunity to promote a multi-brand store’s point of difference.
“If you look at, let’s say, a department store as being a comparative shopping zone versus a branded store, there is your answer. The reality is if you create a fantastic container for the customer to shop across brands to make a choice, you offer an alternative to the store that only sells one brand,” he says.
It’s a point worth noting, and it comes back to the idea of using branded product in order to create a unique store brand.
Strategic retailers that leverage a brand’s profile, existing customers and the resources offered by suppliers are sure to come out on top. They might even rank on the 2014 Forbes list of valuable brands.
Apple, Microsoft and Coca-Cola were ranked the world’s top three most valuable brands by US wealth magazine Forbes last year, mostly due to their ability to offer a desirable product and project a specific lifestyle, experience and emotion.
Marketing gurus continue to preach that such value propositions are key to creating a successful brand and it’s something that many businesses specialising in jewellery products have also managed to master, even if it did take them a little longer than the rest.
The industry may have been slow to adopt a branding mentality but jewellery brands are now a force to be reckoned with; take a quick look at the buoyant financial reports for Pandora and Tiffany & Co for evidence of this.
Branded jewellery has also achieved pleasing results for both suppliers and retailers in the local market for a number of years, but behind the attention-grabbing on-trend product offerings and colossal advertising budgets is another type of branding that perhaps gets overshadowed – the store brand.
Although there are definitely benefits to stocking high-profile products – the ability to entice customers through the door is at the top of the list – Peter Ryan, retail expert and director of Red Communication Australia, explains that product will only get a retailer so far.
“You [the retailer] will not survive as the stocker of other people’s brands,” he says, adding, “Your brand needs to mean something. What is it? What is the value that you add as far as the customer is concerne