The Long View by Vogue Business: Inside the luxury jewellery boom

This article was originally written by Laurie Guilbault for Vogue Business and published on May 31, 2023.

The high jewellery season is in full swing. After Bulgari in Venice and Cartier in Florence, Dior, Chanel, Van Cleef & Arpels, Louis Vuitton, Gucci and Piaget will all stage high jewellery destination events in June. Tiffany will also present its new Blue Book collection at its recently reopened flagship store in New York.

The scale of these events reflect the dynamism of the jewellery market. Global jewellery sales rose by around 25 per cent year-on-year to €28 billion by the end of 2022, according to estimates published in management consultancy Bain & Co’s luxury goods worldwide market study. It was, alongside leather goods, the fastest-growing category in luxury. “Brands invested heavily (and successfully) to fuel demand [through dedicated marketing strategies for the core business and through clienteling and engagement with high-net-worth individuals for high jewellery],” notes Claudia D’Arpizio, senior partner at Bain & Company and co-author of the study.

Uber-luxury jewellery with a price tag above €100,000 outperformed globally over lower priced categories, as did iconic pieces and lines, the Bain report states. “[Post-lockdowns], clients are seeking the most beautiful and authentic pieces. Growth is driven by value rather than volumes,” says Bulgari Group CEO Jean-Christophe Babin.

Specialised jewellers continue to dominate the category: per Morgan Stanley estimates, Cartier became the first jewellery brand to top sales of €10 billion in its fiscal year ended 2023 (Richemont doesn’t break down sales for individual houses). Tiffany, the second largest player, reached €5.26 billion in sales for 2022, according to Morgan Stanley. (The Tiffany landmark revamp is the largest investment in a luxury store globally to date, according to sources with knowledge of the matter.) Bulgari and Van Cleef & Arpels were next with sales of €3.1 billion and €3 billion, respectively. On the fierce competition between Cartier and Tiffany, HSBC global head of consumer and retail research Erwan Rambourg writes: “We believe it isn’t an either/or equation as both should be able to thrive and gain shares from the broader, mostly unbranded, jewellery market.”

Meanwhile, fashion brands are pushing further into the market. Chanel’s jewellery sales amounted to approximately €765 million in 2022, according to Morgan Stanley estimates. Hermès, too, generates a substantial business with jewellery: the “Other” Hermès business lines, which include jewellery and homeware, generated €1.37 billion in 2022, up 29.6 per cent compared with 2021. The boom has inspired more fashion brands to join the fray: after Balmain and Prada last year, Saint Laurent is the latest to enter the category.

There’s plenty of room for newcomers: in 2022, jewellery had the lowest share of branded products (40 per cent) among all luxury categories (compared with 100 per cent for watches, 95 per cent for handbags, 85 per cent for shows and 80 per cent for ready-to-wear), according to Morgan Stanley. Branded jewellery will continue to gain shares from unbranded jewellery (from local jewellers) at a pace of about 1 per cent per year, Morgan Stanley says.

However, experts warn that 2022’s fast growth may normalise. “Like the rest of the luxury market, the boom of the past two years is likely going to moderate, as consumers sober up from the [post- lockdown] euphoria,” says Luca Solca, senior analyst for luxury at consultancy Bernstein. Notably, the US luxury market is cooling. “We have seen a slowdown in demand since November. But, luckily, China is doing much better,” Richemont chairman Johann Rupert said when releasing its full-year earnings on 12 May. It is important that “fashion brands’ push in the jewellery category results in an expansion of the market, and not a cannibalisation”, says Bulgari’s Babin.

Cartier president and CEO Cyrille Vigneron isn’t worried: “In luxury, including hard luxury, most of the growth is coming from new customers in all countries — the US; China; Australia; the Middle East; South Korea; Thailand has developed amazingly in four years; we’re opening a subsidiary in Vietnam soon. The second point is the growing interest in branded jewellery versus unbranded jewellery, both by specialist jewellers like us and by fashion houses that are moving into jewellery. So, the cake has become bigger and there’s room for everyone.”

A challenge, though, is in production. Like in watches and leather goods, the sector needs to recruit and train artisans to keep up with the demand. In January, Cartier opened a new factory in Turin, employing several hundred artisans. Bulgari plans to double the headcount of its production site in Valenza by 2025 and will create a school there to train 750 artisans by 2028.

The high jewellery opportunity

High jewellery, in particular, is increasingly competitive, with fashion brands such as Chanel, Louis Vuitton, Dior, Gucci and Dolce & Gabbana all playing in the field. Cartier’s Vigneron notes that, post-lockdowns, it’s growing faster than overall jewellery, thanks to the return of client events and new markets in the Middle East, Asia (namely Japan, Korea, China, Taiwan and Singapore) and Australia on the rise. “It’s not a democratisation, it would be too strong, but an extension of the high jewellery in all countries as VOGUE BUSINESS a personal statement,” he says. High jewellery also has a halo effect on the brands. As Chanel global CFO Philippe Blondiaux puts it: “High jewellery is a priority not only for the category itself, [but also] for the impact it has on our brand equity, on our image; that’s why it is so important.”

Chanel has a long history in this category — Gabrielle Chanel designed its first high jewellery collection, Bijoux de Diamants, in 1932. More recently, the French luxury house has been increasing its investment in fine jewellery in line with the recent spike in demand. “For watches and fine jewellery, all lines performed, but I want to highlight in particular [fine jewellery collection] Coco Crush, which continues to be a fantastic success — really taking the category upwards. We have become really a very serious player in the category, and we intend to continue to do so with the [next] collections that Patrice [Leguéreau, director of Chanel’s fine jewellery creation studio] will design,” says Blondiaux. (Leguéreau joined Chanel in 2009.)

This commitment can be seen across its retail estate. “The investments in boutiques we have made in 2022 and 2023 all have a watch and fine jewellery component,” Blondiaux adds. “The Place Vendôme boutique [designed by Peter Marino] is our flagship for watches and jewellery. We have opened a fantastic boutique in [Tokyo’s] Namiki — and Rodeo Drive [which opened on 5 May] is a multi- category boutique, but the space dedicated to watches and jewellery is very important.”

Dipping a toe in resale

Luxury jewellers have tended to sit out the vintage jewellery boom, in contrast to the watch sector, where Rolex, Audemars Piguet and Richard Mille are among the high-end brands to have announced or launched certified pre-owned programmes, and Cartier recently signed a partnership with Watchfinder, the pre-owned watch expert also owned by parent Richemont.

“The most important issue in jewellery would be authentication, especially when it comes to stones. Watches are easier to authenticate,” says Bernstein’s Solca. “High jewellery would tend to maintain its value, but one would need to authenticate each stone in these very valuable pieces,” he adds. (The Bulgari Laguna Blu diamond just sold at Sotheby’s for $25 million, “with its price increasing tenfold since the 1970s adjusted by inflation”, Bulgari’s Babin notes).

Integrating resale at a large scale for jewellery into the business model is a challenge. Babin says: “It’s a métier that’s different from ours. It’s complex, and it’s not necessarily a major profit driver.” He compares it to the automotive market’s model of taking back old cars to sell new ones: “It has negatively impacted the industry profitability, shifting them from car making to car financing.”

For Cartier, sourcing and selling archive pieces is an important part of its offer for VIP clients. As part of its recent high jewellery presentation in Tuscany, Cartier displayed some pieces from Cartier Tradition, an in-house division that acquires precious vintage Cartier pieces, authenticates and restores them and makes them available to clients for purchase. Among them was a palm tree-shaped brooch designed by Cartier’s Jeanne Toussaint in 1940, a 1910s diadem headpiece and a 1912 Tonneau watch. (Cartier’s Vigneron was wearing a 1930s brooch from Cartier Tradition at the gala dinner.)

The selection has become wider since Cartier created the division in 1996. “Over the last few years, we have developed this business by sourcing more recent pieces,” says Cartier senior vice president chief marketing officer Arnaud Carrez. “It’s a service that we offer to our loyal customers who want to buy vintage pieces rather than a business,” he adds. Van Cleef & Arpels has a similar programme called Heritage Collection, for pieces created between the 1920s and the 1980s.

Meanwhile, the multi-brand offering is widening. Among new players are 58 Facettes and Castafiore, which both launched during the pandemic. Castafiore, a jewellery resale platform co-founded by former Cartier executive Charlotte Rey, raised €1 million in September 2022. Stanislas de Quercize, board member, president and founder of family office SAVIH and a former CEO of Cartier and Van Cleef & Arpels, is among its investors. Castafiore stocks old and contemporary jewellery pieces, both branded and unbranded, with prices ranging between €400 and €100,000. Other players in jewellery resale include 1stDibs, The RealReal, Vestiaire Collective, Collector Square, Caillou, plus Sotheby’s, which alongside auctions and privates, stocks pieces for immediate purchase online.

Jewellers hit back

As fashion brands eye jewellery, pure- play jewellers are also diversifying — expanding to leather goods, eyewear, fragrance, home, hospitality and even fashion. According to Morgan Stanley estimates, 7 per cent of Bulgari’s revenue came from categories other than watches and jewellery in 2022, 5 per cent for Cartier and Tiffany and 4 per cent for Chopard. While the share generated by other businesses isn’t significant yet, it allows jewellers to recruit a wider and younger clientele thanks to lower price points and hit back at fashion megabrands that step on their toes. “I have seen colleagues coming from fashion into watches and jewellery, so I said I might as well do the opposite,” Chopard co-president and artistic director Caroline Scheufele said before presenting her first couture collection in Cannes on 23 May.

Cartier and Bulgari are already targeting a share of the lucrative handbag market, and Tiffany & Co sees an opportunity in the space. Under the leadership of LVMH, Tiffany launched a new tote, ‘Return to Tiffany’, inspired by the brand’s signature heart motif. New models are in the works. “Tiffany is an incredible brand because it doesn’t really have a limit in terms of the categories of products you can touch in our sector,” Tiffany’s EVP of product and communications, Alexandre Arnault, recently told Vogue Business. “It doesn’t mean we’re going to launch ready-to- wear tomorrow, but if we were to, we would legitimately do it because it’s such an iconic brand in the Americans’ minds that it can touch everything.” Genderless jewellery is another opportunity. Cartier’s Carrez says: “Love, Juste Un Clou, Trinity and Clash are also worn by men.” Cartier recently removed the filter by gender on its e-commerce website last September, replacing it with just the collections (there are still recommendations per gender). Despite not having dedicated men’s jewellery campaigns, the brand features men in digital assets. Two male models wearing brooches were also part of the Cartier high jewellery presentation in Florence. “There is more and more high jewellery for men, not only brooches but rings, stones, in collections,” says Vigneron.

Bulgari doesn’t proactively target men in its communications, but Babin notes that the B.zero1 collection resonates with a male clientele. Tiffany’s Alexandre Arnault also sees a strong demand for men’s jewellery. “[Tiffany’s new bangle] Lock is a good indicator. We see a significant part of men buying it. Based on the size of the bangle, it’s around 30 per cent. But, some men have smaller wrists, and my gut feeling is that it’s more.” In March, Tiffany tapped BTS star Jimin as ambassador. In a campaign, he wears a necklace and bracelet from the Tiffany HardWear collection.

Social media is turbocharging the sector by boosting the brands’ most recognisable products. “When it comes to star brands and products, in a certain context, the more you see them, the more you want them. Covid has accelerated that,” Vigneron explains.

Key takeaway: Jewellery is, with leather goods, the fastest growing category in luxury, driven by very high-end pieces as well as icons. As more fashion brands enter the market, pure-play jewellers are hitting back by exploring new categories such as leather goods, home, beauty and becoming megabrands themselves. They also see opportunities with genderless jewellery. Resale remains a service they offer to collectors rather than big business. With social media turbocharging blue chip brands and most recognisable products, branded jewellery will keep gaining share from unbranded.

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