The Evolution of Local Ecommerce
& Why It's No Longer An Option
The COVID-19 pandemic changed everything, not just in the U.S. but all over the world.
By now we've all heard the stories from our peers in the jewelry industry.
Some states viewed jewelers as non-essential, and forced them to close, while other states did not. This was added an internal controversy within the industry, and in some cases a lot of bitterness.
The way all local retailers were treated was unfair and inconsistent, especially considering big box stores, like Costco and Target, were allowed to stay open because they sold food; but that didn't stop them from selling jewelry at the same time!
The economy collapsed into the worst global recession since World War II while we were all sheltered in place.
Millions lost their jobs but they managed to get by with the help of the CARES Act, and many were getting paid more on unemployment than they were making at their job.
It's clear now that many non-essential businesses were the first casualties of COVID-19 and the recession. After being forced to close, many will never reopen again. And yet, many retail business owners have refused let their income drop to zero and they began the quest to reinvent themselves swiftly.
Some retail stores began selling packaged food goods so they could be reclassified as essential. Did you read about the jeweler who did this, too? Retail businesses reinvented themselves in so many ways it's hard to remember everything we've read since April 2020.
Within the jewelry industry, we noticed a surge of jewelers posting on their Facebook page and finalizing purchases in private messages. We also saw many jewelers launch Facebook catalogs and sell through Instagram. Of course the biggest shift in business was to ecommerce, but we'll get to that in a minute.
Small business owners quickly leveraged new technology to reach consumers and keep sales coming in.
The transformation to a new method of commerce was so successful that retail sales managed to rebound 8.4% in June!
Apparent Economic Rebound By July 2020
The above graph seems to indicate that the downturned economy has already recovered, but it's a false indicator of what is still evolving and changing every day.
Let's look at what caused that massive rebound of retail sales, and explain in-depth why you need to have ecommerce on your jewelry website immediately, but not just any ecommerce, you need to give your local customers what they now expect.
The Local Retailer's Epiphanic Awareness of BOPIS
Remember how panicked everyone was during those first 90 days of the COVID-19 pandemic?
In addition to the sudden lost jobs and delays in unemployment benefits, every day was met with something newly "unprecedented". There was plenty of fear because we didn't know exactly how COVID-19 was spread or how to treat it. The nation mourned as images of overcrowded hospitals and reports of the rising death toll flooded the internet daily.
It was March 10, 2020, when the first Stay-at-Home Order was issued in California. That order stipulated that some businesses could remain open if they offered "curbside pick-up." Other states began issuing similar orders and within a week "curbside" became an everyday phrase.
Retail business owners were given a clear path for their future. Those who had never even thought about ecommerce before, let alone a do-it-yourself ecommerce website design, dove right in to figured out what it takes to sell online and offer ecommerce with curbside pickup.
Building a jeweler commerce website with no prior experience is a daunting task. Anyone can build their first minimal viable ecommerce website within three months if they have a good website cms and ecommerce platform, willingness to learn, and a lot of time. This is exactly what many did during the lockdown.
Although "curbside pickup" was the new buzz phrase during the pandemic, the omnichannel sales method allowing consumers to "buy online, pickup in store" (BOPIS) has been used for several years already. If you find the acronym BOPIS a bit cumbersome to say, you won't be alone, which is why this service is also know as "click-and-collect."
It was December 2011 when Harvard Business Review presented the fictitious concept of ordering electronically for in-store pickup, then Best Buy spent two years developing their technology to combat showrooming which resulted in a successful 2014 holiday season with new convenient ways for consumers to shop.
Kohl's retooled their ecommerce platform in 2013, paving the way to introduce BOPIS in the fall of 2014.
Target also jumped into the curbside pick-up service in 2014 when they teamed up with the Curbside App instead of creating their own.
Even though those early implementations of click-and-collect had their share of problems they eventually matured and was widely used by consumers (probably even by you) without being aware that this was a very specific, and complicated omnichannel technology.
Even before the pandemic eMarketer.com was already monitoring the growth of BOPIS. A year before the pandemic, in March 2019, eMarketer.com reported that US consumers were 41% likely to buy online and pickup in a store if the option were available. Since the pandemic, ROIRevolution has reported multiple times when BOPIS lead to skyrocketing increases in sales, and eMarketer.com has announced that it's actually 44% of online buyers that are using in-store or curbside pickup, as shown here:
All in all, the big retail chain stores paved the way for consumers to become comfortable with BOPIS, and the pandemic forced consumer to use this service out of necessity.
Living through the rapid changes in consumer behavior, especially when someone was in desperate need for toilet paper, sparked an epiphany moment when small business owners realized what BOPIS was, how to use it, and that they could potentially leverage it to recapture their lost sales before the pandemic is over.
Opinions, Insights, & Solutions for Lost Retail Jewelry Sales
If there's a silver lining to the pandemic, it was the invigorated adoption of existing technology and innovative ways to use them.
Small local restaurants and retailers who had never considered technology before spent that closed period cobbling together whatever it took, and revamped their websites and online activities just to bring in some sales. Although retailers rushed to get online to save their own business, what they may not have realized was that consumers were expecting to do it.
There were plenty of opinions abound at the beginning of the pandemic. Many discussions on the Jewelers Helping Jewelers Facebook Group lead to innovative ideas. Instore Magazine, JCK, MJSA, and National Jeweler published ideas and webinars to present survival ideas and action opinions.
One interesting opinion was that jewelers shouldn't spend a bunch of money on their website because the benefits wouldn't be realized before the crisis had peaked. Do you think that was good advice?
We promote ourselves as a jewelry website designer or website developer because those are the phrases you would search for when looking for a new website. Building a website has always been viewed as a service that someone provides, rather than a functionality of software.
On the other hand, when you need a new jewelry POS you probably would search for "jewelry pos" or "jewelry pos software".
Software companies view things a little differently than designers and developers. Software must be created to work for today while planning for tomorrow, but there are times when historical events result in unique tools and features to help businesses survive through the next crisis.
Our software platform was influenced by September 11th and the Great Recession. Consider our crisis experience, we completely disagree with the notion to not make radical changes to your website. The rest of this page explains why you must and join the shift to online selling.
Since we provide our software-as-a-service, you are getting the best software and friendly and knowledgeable support without spending a bunch of money.
To help jewelers strategize through the crisis, jewelry industry organizations compiled lists of great technology based business and marketing methods that retail jewelers have been slow to adopt. Here's a short list of those resources that are still useful now:
- Engagement and connection will keep your brand top of mind
- Make Your Social Media Bio Stand Out
- 7 Tips for Keeping Your Online Business Rolling
- Implementing Online Sales for Jewelers
What Was The Minimum Viable Ecommerce Setup During COVID-19?
Most of the modern business and marketing techniques involve updating your website. Many jewelers asked for website recommendations in the Jewellers Community and Jewelers Helping Jewelers Facebook groups, including how to build a website, what system to use, and what jewelry website design company to hire.
Much to the chagrin of jewelry industry peers who suggested otherwise, jewelers without ecommerce experience flocked to Shopify. Perhaps it was the allure of the cancel-anytime subscription policy, or perhaps it was the low cost of entry during the economically uncertain times.
Most retail jewelers will tell you that they want their website to look unique and not just like another jewelry website template. Ironically, Shopify's websites suffer from a lack of uniqueness, with millions of sites from all industries looking exactly the same.
Shopify's low initial monthly cost gives you the basic features, which are really just the minimal features needed for a viable ecommerce website. The monthly cost quickly rises to more than $400 per month when you start adding features that customer expect.
Since it's a generic ecommerce-only platform with standardized features usable by any industry, Shopify could never compete with an internet platform designed for jewelry-specific online catalogs, content, and marketing.
In the midst of the crisis, consumers will be more forgiving of the hiccups from new online features that were rushed into service. However, they will also expect that you correct those issues before they become too much of an annoyance to their shopping experience, or a hindrance to the online service you purport to provide.
Why Were Local Retail Unprepaired For COVID-19?
In 1995, Amazon and eBay paved the way for early ecommerce and hinted at what future commerce could be.
The dot-com crash of 1999 made everyone believe that the internet was a failure and until 2004 there was a competition between local retail stores and ecommerce retailers, or e-tailers as they were commonly called. In those years you either conducted your retail sales online or in person at a brick-and-mortar store, never both, especially since many of those e-tailers were going bankrupt.
After 9 years in business, Amazon finally made its first profits in 2003. After that, brick-and-mortar stores slowly began to realize that ecommerce could compliment their store rather than compete with it.
With each introduction of new technology it becomes more apparent that ecommerce is more convenient than in-person shopping, especially since you can always find exactly what you looking for. Local retailers, especially retail jewelry stores, have struggled to remain relevant by insisting that some purchases must be done in person.
The argument for in-person sales always includes the belief that consumers must see and touch some things in person before making a decision, especially diamonds. Typically this argument comes from local retailers who don't see the need for ecommerce since their customers are local and, to them, ecommerce is only needed if you expect to sell to people in far off lands.
While retail jewelers have the belief that jewelry must be sold in person, in the grocery industry it's the consumers who believe they must shop in person. However, eMarketer.com now reports that 52.9% of internet users will place at least one online grocery order in 2020. If consumers can overcome their own hesitation to buying groceries online, then retail jewelers surely can overcome their bias toward ecommerce.
Years of continual growth of online sales seems to debunk this belief, and the pandemic has shown how video conferencing and photo sharing can close a sale without ever meeting someone in person.
Were you one of those who believed that ecommerce was only meant for remote sales? If so, has the pandemic lockdown given you a better understanding of why you can't fight this any more?
COVID-19 Gave Us The Transformative Peek Into Futuristic Commerce
States across the US began issuing stay-at-home orders on March 10, 2020. Over the next two weeks many states were forced into complete lockdown and shelter-in-place orders unless you were an essential worker.
Even though many people lost their jobs and income during this period, everyone still had needs to purchase goods. If they could not buy in-person locally then they needed to buy online. This graph shows the measured increase in traffic to the top retail stores who had established themselves as leaders in online ordering with options for shipping, in-store pickup, and curbside delivery.
The above graph clearly identifies what will eventually be recognized as the watershed moment for ecommerce. The week of March 23, 2020 is when in-person retail closed and ecommerce became a necessity of life, and therefore, local business.
Local small businesses without ecommerce were shut down while businesses with ecommerce could continue their ecommerce sales.
Even though internet sales have steadily grown every year, the pandemic created a rapid channel shift from in-person to online. Initial estimates were that ecommerce will grow 18% in 2020, but that estimate will probably be higher when eMarketer does their fall forecasts.
During the lockdown consumers shifted their buying to online retailers they trusted, which is why Amazon, Target, and Walmart are among the top companies. These big name retailers are trusted nationally and already had existing BOPIS enabled ecommerce systems that were quickly modified for curbside pickup rather than actual in-store pickup.
The trust of large retail is based on consistency and availability, not expertise. There's more trust and credibility given to local proprietors than the employees of a large chain store. Don't you think you have enough credibility in your local community to capture local sales from customers who want curbside pickup or BOPIS service?
Will consumers eventually return to their pre-pandemic buying habits and abandon online shopping? It's unlikely to return back to what it used to be for two reasons. First, consumers have become habituated to pandemic behaviors, and click-and-collect is one of them. According to a Shopkick survey, 14% of consumers say their shopping habits have changed and they will shop online more frequently.
Second, even if a vaccine for COVID-19 is available before January 2021, it will be many more months before the its effectiveness will be fully known, during which consumers will still worry about shopping in-store. That same Shopkick survey showed that 60% of consumers are worried about shopping in-store.
To put this in simple terms, even if you follow CDC Small Business Guidelines to create a safe environment for customers and staff, retail jewelers have permanently lost 14% of foot traffic due to the pandemic. Regardless of any personal views, a local jewelry store needs to adjust their operation to satisfy their customers, and without implementations of click-and-collect those lost sales will never be recovered.
What Funded The Economic Bounceback?
The pandemic caused 48.8 million people to lose their job or be furloughed in May 2020. Many people expected the fight against COVID-19 would last only a short time, perhaps even two short weeks, but as that quickly became unlikely, many had to halt their spending. As a result, the US Census Bureau reported a resulting $117 billion drop in retail sales by April 2020.
The CARES Act would provide a $600-a-week federal unemployment benefit, but the flood of 48 million new unemployment filings overwhelmed many states and, in some cases, the first unemployment benefits did not arrive until April.
The potential for long term financial strife had been overshadowed by the concern of when initial benefits would arrive, and when they did, it was several weeks of back benefits with the added perk that some would get more on unemployment than they were making at their job.
Additionally, a majority of Americans also received an Economic Impact Payment of $1,200 in April. The result was plenty of money to burn, with the hope that it would spark consumer spending back up to pre-pandemic levels, which it did.
There was also an additional and unexpected bump of disposable income once everyone realized summer travel was canceled. Those planned summer vacation savings turned into discretionary funds for items that helped uplift emotions after so many were stuck at home for so long.
With local stores shuttered and everyone ordered to shelter-in-place, retail spending plummeted -8.3% in March and -16.4% in April. Once the stimulus money arrived, consumers turned their attention to online shopping and began utilizing curbside pickup options from any business who offered it.
Small Business Contribution To the Economic Bounceback
The rewards really paid off for the local businesses that spent the long hours preparing their website for ecommerce with curbside pickup. By early May 2020, the launch of new ecomemrce sites was perfectly timed with the financial stimulus and ecommerce sales began coming in.
With the belief that COVID-19 would just go away quickly, consumer spending remained high through various digital purchases through early June. Even though 14% of consumers were not returning to in-person shopping (as explained above), in-store spending was strong through June and July 2020 as several stores began to open back up. Now you can see the technology and financial conditions that lead to the economic rebound shown above.
Business Fallout in the Wake of the Pandemic
But not all businesses were willing or able to drop everything and make the sudden adoption of click-and-collect and curbside pickup. With the sudden loss of income, many businesses were preoccupied scrambling to cover their overhead, retain their employees, and sat waiting for things to go back to normal. The PPP loan program helped many of these businesses wait it out.
Although many businesses qualified for a PPP loan, many more did not. There was still more than $130 billion in unused funds available at the close of the loan program on August 8, 2020 because thousands of small local businesses did not meet the application criteria. Many businesses had very low margins with along with high rent and operating expenses and were simply forced to close because no amount of innovative use of the internet would cover their expenses.
The Yelp Economic Average (YEA) is a benchmark of local economic activity in the US. They've been tracking the progress of local business closures and reopenings since March 10, 2020. In April 2020, YEA reported more than 175,000 local businesses closures.
Once businesses were allowed to reopen they began tracking the businesses still indicating a temporary closure and those who marked themselves as permanently closed. The YEA Q2 report indicates that approximately 42,420 businesses have reopened and 72,842 businesses have now marked themselves as permanently closed with no end in sight. The permanent closures now account for 55% of all the closed businesses since March 1.
Restaurants in big cities with high rents are the hardest hit since many of them do not have enough outdoor dining or internet ordering to sustain them. Similarly, local retail in big cities are also struggling to stay relevant with ecommerce with click-and-collect or shipping.
Keep in mind that this fallout of businesses was happening at exactly the same time as the economic bounceback. Can you now see how big of a roll ecommerce with BOPIS and curbside pickup was?
Who Are the 2020 Ecommerce Winning Businesses?
Initially we thought that Amazon stepped in and took advantage of the situation. Even though Amazon hired 175,000 people during the pandemic to handle their surge in online orders and they were the largest winner of ecommerce during the lockdown period, according to eMarketer.com they only experienced a 1% increase in sales over 2019. That means the online shopping surge was shared among many others.
Apple, Wayfair, and Macy's account for another 5.7% leaving 40% of ecommerce sales to any other business that is tapping into ecommerce this year.
According to the US Census Bureau 2020 Q2 Retail E-Commerce Sales report, online shopping topped $211.5 billion from April to June, 2020. That's a 31.8% increase from Q1 2020 and 44.5% increase from the the same quarter last year. Normally Q4 has the highest ecommerce sales every year, but Q4 2019 topped out at only $156.5 billion!
There's a very good chance that retail ecommerce sales will surpass $875 billion in 2020. There's even a chance that retail ecommerce sales will reach $900 billion, and if it does it would be four years ahead of predictions.
Now apply a little math:
($875B estimated 2020 online sales) × (40% of online sales are from small business) = $350B
How much of that $350 billion would you like to have for your small business? Before you give an answer, we have explain what's actually possible.
What Do All These Numbers Mean For Your Retail Jewelry Store?
You've probably heard the crazy estimations that say that there could be up to 1.8 million ecommerce sites in the US. When you consider that ecommerce can be anything from a simple PayPal Buy Now button to Amazonian level ecommerce, there are probably 1.8 million permutations of how to implement ecommerce. Many of these sites have no sales because they were implemented poorly or were pet projects that never got promoted.
Research firms like Digital Commerce 360, Referral Candy, and RJ Metrics, and statistical blogs like WP Forms explain most of those ecommerce sites are making less than $1,000 per year. The estimates say there are about 650,000 sites that break through the $1,000 threshold, but when you exclude marketplace resellers, that number drops to about 300,000 retail ecommerce sites that are worth considering as competition.
According to Statista.com there were a total of 442,597 brick-and-mortar retail stores throughout the United States in 2019 and only about 30% of them are selling online.
RJ Metrics also explains that only 3% of the online sales should be attributed to local small businesses websites with limited traffic.
That's all the numbers we need, not let's run through some numbers to see what potential money is on the table for your business to tap into.
Some data of you vs. other local competitors:
(442,597 B&M stores) × (30% that are selling) = 132,779 local B&M competitors
($350B estimated small businesses sales) × (3% estimated share of sales) = $10.5 Billion
($10.5B) ÷ (300,000 retail ecommerce sites) = $35,000
According to those calculations, it seems like a retail jewelry store could make $35,000 in 2020 if they implement ecommerce with click-and-collect. Naturally, you also have to promote your site so your local customers will know you have ecommerce. Remember that the goal is to recapture that lost 14% of your foot traffic that will not shop in-person any more because of COVID-19.
If you sell at Triple Keystone, then you'd have $23,333 in profit from that $35,000.
The cost of a jewelry ecommerce website inclusive of all our online marketing features is $6,300 per year, which still leaves you $17,033 in profit. Your sale should grow from there once you begin heavily promoting your site the website.
Other Pandemic Factors Currently Influencing Local Online Sales
The above financial analysis is how we would normally justify the viability of an ecommerce site to support your retail jewelry store, but these are not normal times.
The pandemic has created an unusual situation of rapid consumer "channel jumping." Perhaps you've heard the terms omnichannel and multichannel used a lot recently to explain how consumers who are not allowed to shop in-person (the in-store channel) are rapidly moving to ecommerce (the online shopping channel). The rapid migration from brick-and-mortar store to local ecommerce has produced some very interesting and unexpected side effects that were never foreseen. The results from a recent survey are shown here:
- Have you ever seen any other data for a new method of marketing or fancy new equipment or procedure that stimulated a 58% increase in sales?
- Has any other marketing method ever claimed to increase store traffic by 44%?
- Has anyone ever told you to make a change in your business that would increase profits by 43%?
We sure haven't! We would never even dream of making these outlandish claims, but that's what the data is clearly telling us. The retailers surveyed made these claims in April 2020, just after everyone was getting their stimulus money and the economic bounceback was beginning.
Do not ignore this opportunity that is before you, otherwise you might end up being part of the business fallout.
Remembering the Onset of the Great Recession
Trust of an ecommerce website was pretty low after the dotCom crash of 2000 and that subsequent recession. Even though there was plenty of hype about ecommerce, many local retailers still doubted that they would increase business, after all, it wasn't until 2003 when Amazon first turned a profit.
Although Friendster and MySpace were gaining popularity among the general public by 2005, businesses didn't know how to utilize them without a lot of work and creativity. Anyone remembering MySpace will recall how haphazard social media creativity was at that time, which simply didn't mesh with the traditional offline advertising methods that businesses had used for decades.
As a technology company, we felt that the joining together of ecommerce, social media, and Google AdWords a retail jeweler could leap into a new era of marketing and "recession proof" their business. We actually used the headline "Recession Proof Your Business" in our 2007 trade show advertising with our mapped out strategy. Little did anyone realize we were already in the Great Recession when our strategy was being planned out.
We were heartbroken as we watched thousands of retail jewelers close during the recession. During that recession, more than 60 of our retail jewelers went out of business and another 50 decided they didn't need a professional website company any more and downsized or deactivated their websites. Many of those 110 retail jewelers viewed their website as nothing more than an online brochure and a nuisance to maintain because it was so different than their traditional marketing.
Many of those same jewelers had the personality to become online local celebrities and could have pivoted to ecommerce to either supplement their income or even reformat their business. There was a big resistance and lack of trust, not in us and our ability, but that they should not take any gambles in such uncertain financial times.
Instore Magazine's Tips To Survive This Recession
In early 2020 Instore Magazine was planning a lengthy editorial titled "How to Recession-Proof Your Business" in which they offer 19 tips for ensuring a retail jewelers stays healthy during the next economic downturn. When it was published in March, 2020 Trace Shelton said "Unfortunately, the timing of our lead story was all to appropriate."
Of the 32 total tips in that editorial, the 19 recession-specific tips are great with these few that are really our favorites:
- 01. Act early - Jewelers who survived last time reacted before rivals did and it gave them a competitive edge.
» Without hitting you too hard over the head with a lead pipe, we have dedicated this entire page to explaining the financial and sociological reasons why you should be reacting now and contacting us to implement ecommerce with click-and-collect technology.
- 08. Bring in a pro - Bring in a qualified professional to do a full analysis of your business and help you identify and understand areas of weakness and opportunity.
» Our competitors are still promoting sales pitches about diamond and vendor website plugins and open source code while we are trying to shake you up and give you the power to sell the inventory you have on hand to the customers who need a new way to shop. You need to get rid of your back stock right now instead of selling jewelry from a virtual catalog.
- 15. Manage inventory - Now is the time to find ways of reducing slow-moving goods.
» Consider all those items that people never look at when in your store, or the ones you don't take out of the safe because they are such old dogs. To us, those are the perfect items to put on your website. They can stay in the safe as long as they are online, and you could even use them as online-only special offer items to generate interest.
- 16. Don't cut advertising - It's easy to reduce advertising during a downturn, but that allows people to forget about you.
» There's plenty of opportunity for people to forget about you now that their lives are so different than before. When you hire us as your jewelry website design company we won't just set up an ecommerce website for you, we create a new omnichannel selling tool that is limited only by your willingness to implement all the features.
- 17. Develop alternative revenue streams - Even a small revenue stream froom something new cold help you get through the recession.
» We've already explained how the math works out and that there's a real potential for you to have $35,000 in sales from your website within the first year. Like all things, the amount you actually make, and how quickly it will grow, is related to the effort you put into it.
- 18. See challenges, not threats - View the downturn as a challenge to stay in business which will force you to improve.
» Many jewelers view online shopping as a threat to their business; perhaps now is a good time to take the expression "if you can't beat them, join them" to heart.
- 23. The Stockdale Paradox - Accept the reality that there are problems areas of your business that you have been avoiding which have become outdated and which you are refusing to accept.
» There are several areas of technology that may not be understood completely, but that doesn't mean you should be avoiding them. The weak point for a retai jeweler always seem to be their website, online marketing, and their POS. We've got solutions for all of them.
- 28. Don’t waste the opportunity for change - Use the downturn as an opportunity to create a sense of urgency within your store. Innovation and progress are important right now.
» Here's a tough bit of advice to swallow: If you can't convince your employees to work fast to help you change things right now, or to spend all that time working on the new website, then you need to be blunt as you remind them that millions are out of work and their lack of willingness to help you change would force you to replace them.
- 32. Trust in something - You need something to keep you going when times are tough and your brain is telling you: “This is nuts!”
» We know how nuts this all is, and we know how ridiculous it sounds that we are telling you to trust us that our process, when you put a committed effort behind it, will lead you to a transformative future of your business. Just trust us and do not be one of the 110 jewelers from the Great Recession that chose a path to a GOB sale with Wilkerson.
Recognizing the Onset of Symptoms
It turns out that COVID-19 isn't just a virus that's infecting us and causing panic; it's also infecting the economy.
It doesn't matter if you agreed with the shelter-in-place orders or not. As business owners, we all realized that the future of our financial health was at stake once the shutdown was extended beyond 14 days. Meanwhile, most people who wanted to go back to work were assuming they would get their jobs back before their CARES Act unemployment ran out in July.
Here's a snapshot of furlough and layoffs during the early months of the COVID-19 pandemic.
Spending through June was very strong, but then began to slow in July, although ecommerce sales were still up from a year ago.
Throughout August 2020, there were more hints of hard times and expectations of another downturn in the economy. Retail jewelers we spoke to were all happy with their June and July sales, but admitted that August was slower.
Once the CARES Act benefits ran out, the possibility of 40 million Americans losing their home is a real reality while many are struggling to pay for basic expenses.
It's undeniable that all of these financial factors will have an impact on consumer spending limits and why they are spending their money. Holiday gift spending could take a major hit this year as the second economic dip is expected in Q4.
The retail jeweler can usually count on sales relating to weddings, anniversaries, birthdays, and especially the holidays, but jewelers should also expect the consumer budgets will be much smaller. People are planning for hard times while already thinking about what they could spend on their loved ones during the holiday season.
Reread the recession survival tips listed above and really take them to heart.
How do retail jewelers move forward from all of this?
Perhaps the most difficult challenge for a jewelers will be to admit that the COVID-19 pandemic created a major shift in shopping habits, spending limits, and a careful consideration of purchases of necessities.
Jewelry stores have a chance to shine, and remain relevant, if they adjust to match current consumers needs.
Our Recommendations for Independent Retail Jewelers:
- Internet sales are now a business necessity. This is why you need to contact us immediately so we can get started on your ecommerce site. There might not be enough time to launch the perfect site for you, but that's okay since consumers are a little more forgiving right now.
- With lower spending limits you need to consider lower price point items as potential gifts, and even wedding jewelry. There's an important reason for this that you probably already know, but might not have realized it yet.
How much pre-sales support goes into selling a high end item to new buyer? How often do you spend a lot of time working with a customer only to have them cancel at the last minute or tell you they found something less expensive online? Once you launch an ecommerce site you'll attract a lot of new buyers.
All the data presented above paints a picture that local consumers would rather buy online from local stores than large stores. They will conveniently shop from their couches and they will pick up their order in-person when they buy.
From the Great Recession we know that items under $250 sold well online. Lower price point items sell faster online without any need for pre-sales customer service. What your website can sell in volume will hopefully equate to the profits you enjoy for high ticket items that require all that pre-sales support.
- Consider how you can make yourself relevant. Gifts of jewelry, even if they are small, are a great pick-me-up in hard financial times. You should also consider more versatile jewelry that someone will want to wear around the house during the pandemic. How about finding or creating a line of jewelry that can be pinned to a mask? People will still be celebrating anniversaries, birthdays, and getting engaged. Although you already know what items are good sellers for those life events, perhaps it's time to reevaluate if those items are appropriate for this year.
Now is also a good time to remind people that they can bring in their old jewelry for restyling. That could save them a lot of money and you have the added benefit of goodwill and bragging rights.
Whatever you do, make sure to send emails and post to social media to keep in front of your customers. Since you're also watching your own budget, we don't recommend direct mail this year, especially since it's unreliable right now.
With all that's gone wrong in 2020 this is certainly the year we'd all like to forget, but on the bright side you can look back years from now and know that the best thing to happen for you was when you called us to create your jewelry ecommerce website.