Igor Kevchenkov, CEO of Russian Jewelry Company, told Rough&Polished about what is happening today in the Russian jewelry market.
What are the new trends observed in the jewelry market in Russia and what is the target pursued by your company?
In reply to your question, I should note that the jewelry business was affected by the crisis almost worse than any other. But today the situation, one might say, is back on business track. The crisis made us pay attention to weak points in production and trade. Therefore, today the situation is such that it is inappropriate to maintain retail outlets operating at a loss just for the sake of their number.
In my opinion, in times of crisis - and the crisis has not ended yet – Russia’s jewelry market suffered due to the influx of cheap and therefore not always high-quality products from China, Turkey, and Emirates, since Russian companies cannot compete with them in terms of production costs.
The spending power of the Russian population is not increasing. Gold and gems are valued as foreign exchange commodities and our ruble is unfortunately not gaining, but losing its buying ability. This is why to make our goods competitive we have to rely on light-weight products, especially as prices for metals and diamonds have greatly increased over the past year, which could not but affect the final cost of goods.
Do you think people’s buying habits are changing when they purchase jewelry and in which way?
Demand for goods with large diamonds (1.00 carat and above) has noticeably dropped. Manufacturers are also interested in turning out easily sold goods. And these are lightweights with semi-precious stones and diamonds in the price range of 10,000-25,000 rubles.
As for consumer demand, it should be said that buyers have become pickier and choosier in selecting products. They pay attention to the design of goods and – not in the last turn – to their price. Since the competition is tough and people have quite a wide choice of goods to pick from we are trying to meet customer demand by expanding the product range.
Of course, the stereotype that diamonds are a safe investment remains and this is why people tend to buy diamond jewelry. Diamonds-only jewelry or diamond pieces in combination with gems belonging to the first group of precious stones, rubies, pearls and sapphires, account for 60% of all sales.
In what price segment is diamond jewelry sought for most?
Today, the average ticket for diamond goods starts from 15,000-40,000 rubles.
Why is it that Russia – which has everything necessary for the purpose – has not a single global jewelry brand and what is needed to have it?
We forgot about Russia's global brands since the days of 1917. To become famous across the world, like Karl Faberge, it takes time and one should be at least a Goldsmith and Jeweler to the “Imperial Court.” Without doubt, there are many talented jewelers in Russia and this can be seen at our jewelry shows, but to make a breakthrough into the global market one has to spend years and years. And, of course, one has to spend money and make investments in terms of advertising.
What jewelry fairs do you attend?
We try to attend all the jewelry exhibitions, where we keep track of new collections, interesting ideas and work in team with many Russian jewelry companies to offer our customers beautifully made high quality jewelry. We spend a lot of time meeting individual orders and we are trying to avoid large-circulation collections and publicized names. I would like to point it out that an average ticket in the luxury segment is always almost the same, even in times of crisis. Goods from limited collections, unique jewelry made of natural gems – these are jewels not to be found anywhere else, and their price will eventually increase. Money invested in diamonds and gold is the most reliable investment.
Galina Semyonova, Rough&Polished
