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March 25th, 2008 |
It is no secret that rising gold prices made for a difficult jewelry holiday season. We listed in this blog in December how to keyword cope with gold prices that surged from $550 USD per ounce to $850 in three months. Tips included featuring prices in jewelry ads to move lower-priced, in-inventory), and looking to high-demand jewelry holidays (Valentine’s Day, Mother’s Day) to promote Buy Now Before the Price Increases ad messages for gold jewelry items.
$850 per ounce gold was the Good News. Now, near the end of 1stQuarter 2008, with the subprime mortgage lending crisis and decline of the U.S. dollar against currencies from Euro to Yen, gold tops $1,000 per ounce. The Trends Research Institute marked acceleration in overall wholesale costs to 7.4 percent in Jan 2008 (biggest jump since 1981) and the dollar’s slide against the euro and 6 other currencies to its lowest level since 1973 … ironically, the year Richard Nixon disconnected U.S. currency from the gold standard. This trends research institute predicted gold prices rising to $2,000 per ounce, a prediction made in Nov 2007!
So, what’s a jewelry wholesaler or retailer to do? Climb under the covers? Do weekly fire sales? Or gringe about the good ole days? Maybe not …
Hi-Ho Silver. In February, on reading December’s WholesaleU keywording tips to cope with rising gold prices, a BBJ Bangkok commenter said: “Yes, it was a holiday season that saw wholesale jewelry orders saddled with more silver orders.” And “wholesale gold jewelry will be out of the limelight for some time, (so) buyers might shift to silver jewelry.” BBJ Bangkok qualified the “saddled” as a positive, at least in Asian producer markets. Wholesale silver jewelry at the production end works on higher volume to hit the same margins as the gold trade, or employment boon for developing Asian countries who produce wholesale jewelry.
Trendy Bail-Out. Some fashion sources are predicting a trend for cocktail rings and costume jewelry that is heavy on non-precious metal components: Heavy seed pearl (faux pearl or semi-precious stone) overlays … shaped as flowers; mini enamel or cloisonné charms soldered into designs. For bargain-seekers – under $50 – who demand precious metal in their jewelry, gold- and silver-overlays are squeezing into price points.
Bling Accessories. Remember when DIY (Do It Yourself) became all the rage for home renovators? The increase in home self-renovations came with runaway prices in the real estate bubble. If you can’t sell, or can’t afford to buy at bubble-inflated prices, then you feather the existing nest. While waiting out the run up in gold (it may be a while), you might market other Bling to complete trendy looks, including accessories like designer and licensed scarves; handbags that triple as totes, beach bags and carry-alls; rhinestone and jeweled sweater wraps and glittery belts.
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