False Uncertainty in the Jewelry Marketplace
This past week I’ve seen numerous articles detailing jewelry company stock drops, a lull in jewelry sales throughout the U.S. and an overall uncertainty in the jewelry marketplace. Like many of you reading this, at first sight I found these articles frightening! However, as I delved into these articles’ contents, I felt both a combination of relief and frustration. Here’s why:
The Relief: This Supposed “Uncertainty” is Easily Identifiable
When we hear about peaks and valleys in the jewelry industry, we’re given unpleasant reminders of the 2008 recession that left many jewelers down and out. With that being said, speculators have recently poised the jewelry industry for growth and a slow but steady increase in sales.
To see multiple articles contradicting these projections last week was unnerving and, at first sight, served as a bit of a confidence crusher. However, these news stories reporting on a lack of jewelry sales and a deflating market all seemed to be attributed to one thing – the presidential election.
Read the article linked above and you’ll see that every election, there’s widespread speculation over specific candidates and the effects each would have on the economy if elected.
The article states that, generally speaking, most of the candidate-specific speculations over economic effects are wide of the mark and rarely come to fruition and this has been seen throughout the history of U.S. politics.
Usually, the only actual effect an election has on the economy is a general uncertainty, and depending on their political affiliations, one may view the economy as heading in a positive direction or a negative one. However, the article claims that, “If the election isn’t turning your way—or even if it is—look at how the market has risen in good administrations and bad”.
Regardless of whether you’re a republican or a democrat, this 2016 election undoubtedly has polarizing candidates on both sides – and this is where the uncertainty comes into play. People feel more confident about the state of the economy and specific marketplaces when their political party is in Washington, and less confident if they are not.
Either way, these past few months have been a media hay day with regards to politics and put broadly, everyone is a bit on edge. This has lead to a temporary fall in sales throughout numerous industries – the uncertainty of politics has lead to less spending in households throughout the U.S.
The Frustration: Promoting “False Uncertainty” Can Create Real Uncertainty
In no way does this deceleration speak towards the state of the apparel industry, or of the jewelry segment as a whole, as some articles seem to imply. Rather, it speaks of the psyche of the American populace and serves as proof that Americans aren’t sure what to expect once the next president is elected- nothing more.
All things considered, this temporary lull in jewelry sales is not representative of the industry’s future and serves as nothing more than a snapshot of the economic climate during a perplexing time, with regards to the politics.
As stated in my introduction, I mentioned how after reading some of the articles that claimed that sales in the jewelry industry had slumped, I felt both relieved and frustrated;
Relief because after further investigation into these articles, I realized this recent slump is attributable to uncertainty over the election, not an uncertainty in the jewelry industry as a whole.
I felt frustration, though, because headlines on articles such as this one seem purely attention seeking and misleading.
Negatively representing an industry on the rebound seems to serve no purpose other than generating more false speculations and rumors, yet so often these are the types of messages the public is exposed to.
The performance of one or two major firms is not indicative of the performance of an entire industry and, as we’ve covered in a past blog post, the jewelry industry is changing. It will take some time for things to stabilize yet the marketplace, as a whole, is poised for growth.
As members of the jewelry industry it’s important that we keep things in perspective and weigh all economic factors before jumping to conclusions. Additionally, it’s equally as important that we keep jewelry consumers and investors aware and up-to-date on market performance, new offerings and new product lines.
In order to continue growing we must not let articles (such as some of the ones I’ve linked to throughout this article) tarnish our confidence.
BUT MOST IMPORTANTLY, we must not let these types of articles and new stories tarnish consumer confidence.
Customers should be optimistic towards the future and realize that jewelry - either purchased and cherished as an individual piece or as a stock investment - is worthwhile endeavor.
Rumors, false speculations and misleading headlines should be analyzed critically and met with skepticism.