Summer vacation seasons are usually most remunerating for jewelry manufacturers. When a strong wave of tourism covers all the most popular resorts around the world, global sales of luxury goods embark on a sharply upward trajectory. Demand for high-quality luxury goods is largely supported even by consumers in developing countries, which in turn stimulates the growth of globally renowned brands.
Forbes predicts the global luxury market will grow by 8 percent this year and will reach $276 billion, largely due to sluggish U.S. economic recovery and the debt crisis erupted in Europe.
Nearly all major European brands, including LVMH, Dior, Burberry and Celine, raised their prices for goods at an average of 5 to 15% in the first five months of this year.
Depreciation of the euro has become one of the main reasons for this increase as it is indicated in a recent report released by the World Luxury Association (WLA), an international nonprofit organization specialized in luxury brands market research.
Since the beginning of 2010 to the end of May this year, the euro depreciated by 20 percent against the renminbi.
The average jewelry consumption by Chinese tourists traveling overseas has increased from the 650 euro mark in 2005 to 1,300 euros for every tourist.
Robust growth of China’s jewelry market will confidently reach $14.6 billion in 2012, making China a global leader. By the end of 2013, all the global brands will be based in China.
Luxury brands making part of PPR, such as Yves Saint Laurent, Alexander McQueen and Gucci, have reached a combined sales growth of 24.4% in the second quarter, higher than the formerly expected 19%.
In China PPR’s income jumped 54% in the second quarter, while in Western Europe the group’s income grew by 19% and in North America by 26%.
Overall, total operating income reached by PPR was €749 million ($1.1 billion) against ?7.220 billion worth of revenues earned by the group in the six months of this year.
In July, PPR announced the acquisition of Swiss group Sowind controlled by Girard-Perregaux and JeanRichard. This is the first step made by PPR into the world of expensive watches, after it sold its watch brand Bedat & Co 5 years ago. Established in 1681, JeanRichard is one of the first Swiss watch brands. Sowind was founded later, in 1998, and in its production to date, involved 270 employees producing 15,000 copies of luxury watches every year.
But for LVMH July turned into surprise when Bulgari provided detailed explanations on the availability of assets offered for sale in March. For unknown reasons, the actual number of shares does not include additional 57 000 shares owned by Paolo and Nicola Bulgari, which is now going to drain LVMH of additional €300 million.
The studies performed by the European Commission, a watchdog of the EU, proved the deal will not have negative impacts on the world market and joint activities of LVMH and Bulgari will not result in a high market share under any possible market environment. Subsequently, LVMH received a EU approval to buy Italian Bulgari for €3.7 billion ($5.24 billion).
Bulgari, in turn, has demonstrated its excellent results for first half of 2011 with a turnover of €548.0 million posting a sales growth of 23.6%. The brand’s operating profit amounted to ?15.3 million, while its net profit was ?9.1 million.
The Uplifting the Earth report gave special attention to ethical production of jewelry luxury brands.
While carrying out an analytical assessment of the ten most prestigious jewelry brands including Boucheron, Bulgari, Buccellati, Cartier, Chanel, Chopard, Graff Diamonds, Harry Winston, Piaget and Van Cleef & Arpels for social and environmental aspects of their production, it was noted that their work in the field of innovation regarding the use of precious metals and precious stones lags far behind, with the exception of Cartier and Boucheron, which recognized the need for new solutions in this field.
The study also found that six out of ten brands continue to offer Burmese rubies in London and Geneva, in spite of the EU embargo.
There were defined new brands that embody the new approach to jewelry. These were CRED Jewellery and Fifi Bijoux, JEL and Brilliant Earth.
Marc Choyt of Reflective Images Inc and co-founder of Fair Jewelry Action in his speech stressed that the big brands must get their act together if they are not going to lose customers to the companies that really care. “They can't hide behind vague statements or the Kimberley Process anymore, because others are showing what's possible. We can make jewellery that makes a positive difference to the world.”
More than 30 Italian companies were represented at the JA Summer Show in New York, where they presented artworks of skilled craftsmen. It is the second year as the Italian manufacturers have adopted the trend of producing jewelry in 18 carat gold adding silver, which has become fashionable and affordable. Despite the falling currency rates, including the U.S. dollar and euro, the Italian jewelers felt revival this year.
The main markets for Swiss watches grew, and gold watches were on the first position in terms of value. The Federation of the Swiss Watch Industry increased exports by 19.3% over the first six months, to CHF 8.7 billion, compared with the first half of 2010. Exports to Asia increased by 24.3%, to Europe by 13.3% and to the U.S. by 16.6%.
"We must overcome the concept of regional division and the gold sector of Italy should strive for unity" - this was the statement of Licia Mattioli, the new president of Confindustria Federorafi (National Federation of Italian Jewellers), which marked her appointment. Her first tour of Piedmont was dedicated to collecting ideas and opinions with a view to unification. New views on the industry in need and on prosperity of this sector will be the main tenets of the new head of the federation.
Thanks to the assistance of Irish jeweler Paul Sheeran Gucci will launch its first concession in Dublin. Although Gucci hasn’t got the kudos that it deserves in Ireland, but it is the top brand in Italy and in the top four luxury brands in the world. Paul Sheeran predicts success to jewelry business, saying its turnover will increase by at least 15% next year and demand for diamond rings will be strengthened.
‘‘Even with a luxury brand like Gucci, the prices are perfect for the Irish market at the moment," he added. ‘‘Customers can buy a fantastic piece of Gucci jewellery for about €200."
Fashion brand Salvatore Ferragamo has teamed up with Italian jeweler Bulgari to create its first joint collection of jewelry. The design of the collection reflects the brand’s heritage and plays with its most celebrated symbols and icons, using materials such as silver and gold and precious and semi-precious stones. The range will be available from October in a limited number of stores specially selected from among the company’s most important retail outlets worldwide, starting with the European, US, Japan, and Asia-Pacific regions. The both brands believe this project to be an extraordinary opportunity to extend and enrich their range with a product able to put the spotlight on their brand’s values of exclusivity and craftsmanship.
Ring with an incredibly rare blue diamond, which has never been put up for auction, you will be selling jewelry at Bonhams Fine Jewellery Sale in London on 21 September. Ring, created by BULGARI in 1960, is estimated to range from 960.000 to 1.28 million. Two pear-shaped diamond, a 3.72-carat in size, an unusually bright blue, and the second white diamond carat size of 3.93 in the frame of small white diamonds sparkling across the ring, the fans will show an example of exquisite jewelry craftsmanship from Bulgari.
A blue diamond ring that has never been sold at auction is scheduled to appear at Bonhams Fine Jewellery Sale in London on September 21. The ring, which is estimated to sell for anywhere from $960,000 to $1.28 million, was commissioned from Bulgari in the 1960s. The ring is set with two large pear-shaped stones, one a 3.72-carat Fancy Vivid Blue diamond and the other a 3.93-carat white diamond, amidst smaller white diamonds sparkling all over the ring, will demonstrate an exquisite example of Bulgari's craftsmanship to jewellery connoisseurs.
Several new retail stores trading in watch and jewelry brands were opened last July.
ROLEX opened their first flagship store in New York at 53rd Street and Madison Avenue, where more than one hundred world-known brands offer eminent expensive watches to consumers in the United States.
Tiffany launched their first store at the Frankfurt airport, one of the largest international passenger hubs all over the world. The new boutique will be the second in the city and will increase the total number of Tiffany’s stores in Germany to six.
Swiss luxury watchmaker Breguet commissioned two new China boutiques, one in Ningbo, Zhejiang province, and a second in Beijing.
A series of sales of jewelry in support of Japanese women who are victims of the earthquake, the group decided to organize a jeweler Damiani. The majority of Damiani’s boutiques in Italy, Milan, Florence, Bologna, Rome, Naples, Turin and Verona, as well as in New York, Los Angeles, Honolulu, Tokyo, Paris, Hong Kong and Macau will showcase jewelry pieces named "Damiani for Japan." From July 1 to August 31, 2011 all the customers ready to make a small contribution to the charity event will be offered a special collection of Damiani with exceptional discounts. All the proceeds from the sale will be transferred to the Japanese Organization for International Cooperation in Family Planning.
The famous Italian fashion shoes stylist decided to challenge the world of jewelry. A new line of men's jewelry from Cesare Paciotti will adorn the brave image of Bruce Willis. All the jewelry pieces made in 925 silver combined with onyx and pearl have a distinctive mark as a sword, the main logo of Cesare Paciotti.
Every year the world of luxury and moneybags boggles imagination on an ever new scale. The astonishing news about the appearance of a super-yacht, the History Supreme, owned by a Russian businessman turned upside down every imaginable and unimaginable thing about the limits of modern jewelry. More than 100,000 kg of gold and platinum were used to make the $3 billion worth yacht belonging to Abramovich featuring luxury platinum bedrooms, walls made of meteoric stones and dinosaur bones; this exquisite package is topped by two pools, a submarine, helicopter pad and missile defense system.
The History Supreme was designed by jeweler Stuart Hughes from Liverpool, who spent three years to implement the pompous project.
Veronica Novoselova, Rough&Polished correspondent in Italy
