Jewelry markets of the former socialist camp rarely come in the field of vision of mass media. No wonder, the JCK online’s observer Rob Bates in one of his reviews gives a link to The Prague Post, an English language weekly, telling a story about the Czech jewelry industry.
Diamonds, once the privilege of only the very wealthy, are becoming both more affordable and popular with Czech consumers, the weekly says. Jewelers are noting significant growth in demand for diamond jewelry as the economy has boosted consumer confidence and marketing strategies have positioned diamonds as an affordable luxury item. Jewelers are even selling diamonds to customers as a sound investment.
“The number of orders for exclusive diamond jewelry is growing mainly due to the strong crown, so Czech clients are starting to invest money in luxurious jewelry and watches,” said Michaela Jetmarová, marketing director of jewelry distributor Dušák.
The Plzeň-based Diamonds International Corporation, a member of the Antwerp Diamond Stock Exchange, reported a 600 percent increase in turnover since 2007 in its sales of investment diamonds as well as its production of diamond jewelry. Board member Luboš Říha said the market for diamonds was strong before it nearly stopped during the world wars and ensuing communism, when luxuries were frowned upon. Now, younger generations are warming to the more Western attitude toward diamonds as traditional gifts and are willing to spend the money.
“During the
There are nearly 200 companies selling jewelry on the Czech market. Older jewelers such as Klenoty and Primossa, which were on the market throughout communism, sell a large variety of jewels. Market newcomers such as ALO jewelry, D.I.C. and Klenoty Jitka Kudláčková belong to the smaller group of jewelers which actually produce original diamond jewelry, a risky bet as customers have typically sought jewelry created by bigger, international names.
“We have certain clients that enjoy our design. Some Czechs, however, still prefer to buy luxurious jewelry abroad,” said Dušan Mlynarčík, director of Klenoty Jitka Kudláčková.
The challenge has been to educate customers about the changing quality of Czech-produced diamond jewelry, the reputation of which did not manage to escape unscathed after the revolution.
“In the time of the [communist] regime, original stones in jewelry were not available, so jewelers used synthetic stones and the focus was more on the design. Today, it’s the contrary. Now, it’s the gemstone that dominates the piece and there are no boundaries for design or price,” said Alojz Ryšavý, who founded the Czech company ALO jewelry in 1995. The company now employs almost 120 people and supplies 350 stores around Europe and in
The old traditions associated with diamonds are partially being stoked by the number of new businesses and their marketing campaigns. Ryšavý said his company has also experienced a changing demand and attitudes toward diamonds from Czech clientele and his business has responded in kind with focused advertising and selling points, to great success. ALO sold 1,000 diamond rings in 2000. Today, they sell the same amount in one month and last year the company had a 30 percent revenue growth.
“People have a tendency to think diamonds are something only wealthy people can afford, but this is not true. One can purchase diamond jewelry starting at 15,000 Kč [$836] and this is one of our strategies to market the product,” said Ryšavý. “The lower end of customers are people from the age of 25 who buy diamond rings for their first engagement and the top ones are customers who seek original jewels.” The most expensive set of diamond earrings and rings the company sells costs 3 million Kč.
According to Říha, D.I.C. sees two types of Czech clients: one whose jewelry is of sentimental value and a generational keepsake that may have survived wars and communism and one who looks at the investment potential of the world’s most precious stone.
