It’s been more than 60 years since De Beers persuaded young consumers to mark the milestone of their engagement or marriage with a diamond. Time has moved on and the ‘Diamonds Are Forever’ advertising line is showing its age. It is not entirely clear to the diamond jewelry marketing executives whether a new generation called the ‘Millennials’, born from the early 1980s onwards, is interested in buying their products.
The Millennials are not following in the footsteps of previous generations when it comes to the rights of passage into adulthood. For one, they are delaying marriage, or doing away with it all together. For those who choose to marry, they are dispensing with many of the well-known wedding traditions.
“The problem for jewelry marketers isn’t that Millennials are rejecting diamond engagement rings, but marketers need to talk with the next generation in a way that is meaningful and relevant to their lifestyles. That ‘Diamonds Are Forever’ tagline has lost meaning for a generation that has heard the widely-quoted ’50 percent of all marriages end in divorce’ statistics and often times has experienced it in their families growing up,” says Pam Danziger, president of Unity Marketing and author of a new study, Marketing Jewelry to Millennials: How to sell luxury jewelry to the next generation of affluents.
Millennials, it seems, get a greater thrill from buying technology than they do jewelry. It’s not just the need to mark an engagement with the purchase of a diamond ring that Millennials are questioning. A recent survey among 1,335 affluents, 18 percent of whom are Millennials, discovered that affluent Millennials (aged 24-34 years and incomes of $100k and above) get more pleasure from their technology purchases than they do from buying fine jewelry.
For example, some 46 percent of Millennials said buying technology is a category that gives them great pleasure, as compared with 25 percent who felt the same about jewelry. This finding is particularly relevant to jewelers since the commitment to pre-purchase research and spending levels are very similar for technology and jewelry.
Danziger says, “These Millennials would much rather drop $700 on the latest phone or tablet computer, than on a new pair of earrings or cuff links. Marketers and retailers need to discover how to change the conversation, so that buying jewelry is as fresh and exciting as the latest iPhone. The problem facing jewelers is how to communicate with Millennials to reassure them they already have the skills needed to buy fine jewelry and that doing so is just as cool as buying the latest techno-gadget.”
Creating a New ‘Buying Experience’
Hearts On Fire has found a new way to make shopping for jewelry cool, and the jeweler may have found a way to bridge the generation gap. The company has designed a whole new jewelry buying experience in a store that evokes some of the subtle design aesthetics and high-tech vibe one finds in an Apple store. Today there are two HOF stores in Las Vegas and King of Prussia, PA, with more to be opened.
Explaining the new ideas around displaying and selling diamond jewelry, Glenn Rothman, CEO of Hearts On Fire, said, “With all of the technology and digital innovation in our lives today, consumer expectations have changed when it comes to how they want to shop. Especially when it comes to highly considered purchases, such as diamond jewelry, consumers no longer want a traditional feel and are searching for a more unique, personal experience. That is why we are excited to continue to refine and expand our retail concept – breaking conventional shopping barriers and making the diamond jewelry retail experience enjoyable and interactive fun again.”
The different jewelry store experience starts with the sheer curtains that hang on the inside windows and the studied use of shade and lighting to create a mood inside the store. There are no overhead florescent lights inside, but area lighting that the store’s staff can control depending upon the lighting needs and feelings they want to create. The store features several full length mirrors that catch light and give customers the chance to experience the jewelry they try from head-to-toe.
There are eye-level ‘Jewel Boxes’ display cases that spotlight a carefully curated selection of designs and replace long display cases you have to bend over and that are filled with row-after-row of look-alike jewelry. Finally the store has a high-tech edge with keyless access to the Jewel Box cases and a ‘Knowledge Wall’ that digitally displays information about the brand, the diamond cutting process that creates the brilliance in the Hearts On Fire diamonds, and models and celebrities wearing beautifully designed pieces.
Danziger says: “Jewelers need to learn a whole new language to connect with the next generation of jewelry customers – the Millennials. That language has to communicate not just in words and pictures, but in emotion and experience. It has to have the cool sophistication of high tech, but also the back-to-basics values of fine design and quality.”
Millennials: The Boomerang Generation
Millennials are being called the boomerang generation since many are unable or unwilling to leave their parents’ home. Sometimes, they are called the Peter Pan generation because they supposedly don’t want to grow up.
But now marketers, manufacturers and retailers are recognizing the group’s potential as something important to their bottom line: the consumers who will drive the economy in the decades ahead.
“Our whole consumer model is based on the baby boom,” said Diane Swonk, chief economist for Mesirow Financial. Now, the coming generation is “setting up a whole new consumer model.”
Perhaps the biggest change is that today’s young adults — in part because they came of age in a harsher economic climate, in part because they have many more choices — are putting off major life decisions as well as the big purchases that typically go with them. As a result, their consumer behavior is unpredictable. “They’ve learned to live life in a different way,” says one expert.
There are more 23-year-olds — 4.7 million of them — than any other age, according to U.S. census data from June 2014. The second most populous age group was 24, and the third was 22. Millennials will account for one-third of the adult population by 2020.
The generation is also the most educated generation in American history. Far more are going to college than in past times. The largest slice is now graduating and emerging in a post-recession landscape where the job market is still troubled but starting to show signs of improving. Many of the new college graduates have student debt to pay off. And wage growth for younger college graduates has risen slowly since the recession, lagging that of all full-time workers and making expensive purchases more difficult.
But they also have significant earning potential in the years to come and, because of the sheer size of the group, have the ability to reshape the economy in ways that haven’t happened since the huge baby boom generation was hitting the job market and moving into first homes.
Mortgage lenders and automobile manufacturers, who deal with the largest purchases most people make, have yet to figure out how to successfully tap this group of consumers.
This is a group of consumers which represents $1.3 trillion in consumer spending, out of total spending of nearly $11 trillion, according to a study by Moosylvania, a digital marketing company in St. Louis.
By 2020 Millennials are projected to be 50% of the workforce and by 2025 this number is expected to reach 75%. This is a group of people that grew up as digital natives meaning they had access to social networks, smart phones, tablets, and pretty much all of the other pieces of technology that we use today and the new behaviors that go along with them. This is a generation that doesn’t know what it’s like to get 200 emails a day, sit in cubicles, or use many of the legacy technology platforms that most organizations use today. In additional, Millennials are also bringing new attitudes, values, and approaches to getting work done. It’s no wonder why organizations around the world are so concerned with this new generation of worker.