Rapaport Magazine - August 2019

VOL. 42 NO.8 AUGUST 2019

IN WITH THE OLD Estate and antique pieces are still drawing in customers who want authenticity and good craftsmanship

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ANALYSIS

INSIGHT

STYLE

LEGACY

IS THE CHINA TRADE WAR REALLY CAUSING A “RETAIL APOCALYPSE”?

HOW TO PLAN IN-STORE EVENTS THAT VISITORS WILL REMEMBER

WE WENT TO PARIS HAUTE COUTURE WEEK TO BRING YOU THE HOTTEST TRENDS

THEY MAY BE REPLICAS, BUT THE JEWELS IN THE CROWN ARE MUSEUM-WORTHY

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CO N T E N TS COVER 22 42 Page

Page

22 Cover

Blast from the past: Estate jewelry is seeing a resurgence among retail customers for its distinctive looks and rich stories.

Good old fashions: Period pieces and big names dominated the Las Vegas Antique Jewelry & Watch Show.

High-end heritage: As more of the major maisons begin offering their own vintage collections to the public, dealers and auctioneers are facing competition.

Sovereign sparkles: Highlights from Christie’s Maharajas & Mughal Magnificence sale.

38 Jewelry Connoisseur Asymmetric earrings prove you don’t have to match to look fantastic.

40 Book review From the Middle Ages to Beyoncé, Jewels and Jewellery takes readers through the offerings of London’s Victoria and Albert Museum.

RETAIL 32 Retail profile Investing in employees and the community is important to Hamilton Jewelers of New Jersey and Florida.

42 Style

34 Retail insight

The CEO of Mellerio dits Meller talks about her label’s five-century heritage and its latest works.

The biggest trends from Paris’s Haute Couture Week.

48 Designer

An insider shares her tips on the holy grail of event planning.

50 Legacy

37 RetailRap

The historic royal jewels portrayed in Netflix drama The Crown are the subject of an exhibit on the show’s costumes.

What is the best way to hire and retain staff ?

IMAGE: DEA/A. DAGLI ORTI/DE AGOSTINI VIA GETTY IMAGES; COVER: BHAVESH GULABIVALA/JOHN DORAN

STYLE & DESIGN

IN-DEPTH 14 News

Industry: Sell more rough at auction.

Retail: Protests, trade war hit Hong Kong stores.

Mining: Rough demand plummets.

Movers & shakers: Who’s coming, who’s going.

20 News analysis If tariffs on Chinese products go into effect, US retailers will feel it in their bottom lines, but those that innovate and diversify will have an advantage.

ON THE COVER: Selection of estate jewelry from Hancocks London. Turn to Page 96 to find out more about each piece.

32 Page

54 Colored gemstone Opal is all the rage among designers and collectors alike, especially its Australian black variety.

MARKETS & PRICING 57 Trade report 59 USA 64 India 65 Israel 66 Antwerp 67 Hong Kong

68 Diamond data 73 Price List 85 RapNet price list 90 Directory 94 Calendar 96 The final cut

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Note from the publisher

IMAGE: BEN KELMER

S

ROUGH TIMES

lump, sink, slash, drop, dent and fall — some of the key words peppered throughout our news headlines over the month of July made for less-than-happy reading. The stories below them were even more depressing as we delved into the turbulent times facing our industry.

One person in particular, a diamond dealer, accused us of adding to the trade’s woes by publishing negative news.

We are not the industry’s spin doctors. We have enough fake news to contend with. Rapaport’s role is to provide reliable, accurate and timely information — “information that means business,” as our mission statement says. We achieve this by holding a mirror up to the sector to reflect what is happening. Admittedly, our job has not been so cheerful of late.

Type the words “diamond industry crisis” into Google and you will be met with a plethora of articles detailing the pain the sector is suffering. High levels of inventory, lackluster sales, painfully tight liquidity, stark profitability warnings and a severe crunch on credit — these are the symptoms of an industry crisis. Companies throughout the diamond

pipeline are suffering, but it is the midstream that is bearing most of the burden. Whether it is manufacturers in Surat, India, or diamond dealers in Israel, Antwerp and New York, these are not the best of times and could, possibly, be the worst of times.

Thankfully, the shining gem currently keeping our industry sparkling is without a doubt the American economy. While it is not red-hot, it has been solid and consistent. But while things, in a general sense, could get worse before they get better, the fact is they will get better. And those who will be there to benefit when the market turns are the ones who are planning now.

“The Chinese use two brush strokes to write the word ‘crisis,’” noted former US President John F. Kennedy.

“One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger — but recognize the opportunity.”

John Costello PUBLISHER john.costello@diamonds.net DIAMONDS.NET

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Art Deco carved rockcrystal pendant with triangular black enamel, diamond and coral setting.

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IMAGES: DEA/A. DAGLI ORTI/DE AGOSTINI VIA GETTY IMAGES; HEATHER DURHAM PHOTOGRAPHY (WALTON’S ANTIQUE AND ESTATE)

COVER

BLAST FROM THE

PAST Vintage is seeing a resurgence among retail customers, who value its distinctive looks and rich stories.

IMAGES: DEA/A. DAGLI ORTI/DE AGOSTINI VIA GETTY IMAGES; HEATHER DURHAM PHOTOGRAPHY (WALTON’S ANTIQUE AND ESTATE)

BY LARA EWEN

R

etail is a circle, not a line, and every trend comes back again. As a new generation of customers discovers the charms of vintage jewelry, the style and craftsmanship of eras past have become not only a driving force in design, but a lucrative business for stores looking to find the right merchandise mix to draw in an increasingly elusive millennial customer.

While it’s popular with jewelry consumers across the board, estate has become especially desirable among younger shoppers.

Since many estate pieces are vintage, made before factory machining became mainstream, the one-of-a-kind looks and handmade appeal are in line with today’s design trends. Estate also brings in customers who are shying away from mined stones, as recycled ones are an attractive alternative. In addition, today’s under-40 customers are drawn to stories and experiences, and estate jewelry has a built-in tale to tell.

“Estate and vintage [mean] anything that’s not brand new,” says Julie Walton Garland, manager at Walton’s Antique and Estate Jewelry in Franklin, Tennessee. In contrast, the term “antique” applies to anything that is more than 100 years old, she explains.

Her customers come for the stories the pieces tell, and they “love that it’s one of a kind and that they’re not going to see someone with the exact same ring on.”

THE TOP PERFORMERS Even though there’s a vast array of styles available in the estate market, some are more popular than others right now.

“The Art Deco style is always the most popular. It’s also the most replicated style in new jewelry,” says Amanda B. ColemanPhelps, owner and president of Nelson Coleman Jewelers in Towson, Maryland, which sells estate, custom, and contemporary pieces. Apart from certain styles and eras, she continues, branded pieces such as Tiffany & Co. or Cartier sell best, as do staple pieces such as diamond studs, tennis bracelets, and engagement rings.

Garland cites 1920s and 1930s diamond engagement rings as her store’s number-one sellers. She affirms that Art Deco and styles with vintage filigree detail are in high demand. “It’s a classic design. It’s made by hand, and light and airy, with the focus on the center stone and [with] smaller diamonds. It’s timeless, and it doesn’t look trendy.”

Platinum, which became popular in the 1920s, is also soughtafter, as are old European mine-cut diamonds, which are cushionshaped and warmer in color.

OF PRICE AND PROFIT One of the reasons many retailers choose to deal in estate is its profitability.

“Estate is usually a higher margin,” says Coleman-Phelps.

“When we buy estate, we also own it,” as opposed to having it on memo. So while her store assumes “100% of the risk at the beginning,” she says, she is also free to sell it at her leisure, which “does help our bottom line and give us some multifaceted ways to exit from the item.” ▶

EDWARDIAN Sapphire and rose-cut diamond ring from Walton’s Antique and Estate Jewelry.

ART DECO Ring with an oval, 5.83-carat faceted sapphire from Nelson Coleman Jewelers.

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carefully and gently, without removing any patina or estate appeal, since that could lessen the value.

Garland gets her estate stock from the general public, antique dealers, online auction houses, and antique shows in Las Vegas and Miami, Florida. But she admits it has not always been easy to get the quality she wants, due in part to the age of the items. “A piece that’s over 100 years old has wear and tear, and sometimes it can’t be repaired,” she says. “But we have an in-house jeweler.”

In addition, says Garland, some items have been poorly restored or refinished, rendering them less valuable.

“Certain types of estate goods are in general always harder to come by,” comments Schwartz. “And jewelers who don’t appreciate the beauty in an old mine-cut diamond and elect to recut it into a modern brilliant diminish the supply of betterquality old mine-cut diamonds.”

APPRAISING AND UPCYCLING Art Deco necklace from Walton’s Antique and Estate Jewelry, featuring a bezel-set old Europeancut, 1.13-carat diamond in platinum.

Prices for estate tend to be lower than for custom or contemporary jewelry. “What you pay for in custom is the labor and the design,” says Garland. “So you’re paying for that time.”

When it comes to contemporary, “designers charge more for their pieces. You’ll pay more for a brand name, so some contemporary can be more expensive.”

However, a recent increase in dealer pricing may result in lower margins for estate retailers.

“The internet has been a great resource for education, which means deals are harder to find,” Garland reports. “Now people, and dealers especially, know what’s really popular, and they’re charging for it. We try not to have that reflected too much on the customer end, though, and we don’t purchase anything that’s too expensive, because we don’t want to charge customers too much.”

In order to confirm that estate goods are both authentic and properly valued, retailers need to learn how to appraise the pieces carefully. Coleman-Phelps is a graduate gemologist and an American Gem Society (AGS)-certified gemologist appraiser, and she employs two others with the same credentials. She also relies on her store’s 40-plus years of collective experience to identify hallmarks, materials, gemstones, cuts, styles, settings, metals, and other features that determine a piece’s value.

“We do a great deal of online research, as well as using our industry contacts to help with expertise we may not have in our store,” she adds.

Garland, who has three Gemological Institute of America (GIA)-certified gemologists on staff, takes a similar approach, asserting that the best knowledge comes from experience. “I can glance at a ring and know instantly what it is by how it feels and how it looks,” she says.

“And if we ever have a doubt, we do a lot of research. And if we’re not able to authenticate, we reach out to friends.”

Many retailers are able to convert the outdated styles customers bring in into something more wearable. “We have methods to update estate pieces without ruining their estate appeal,” says Schwartz. “For example, pins and brooches are not as [desirable] as they used to be, so instead of completely melting a pin or brooch, we might suggest a customer add it to a chain and convert it into a pendant.

Redefining the way an estate piece is worn maintains the integrity of the piece while still enabling the owner to enjoy what they own.”

FINDING THE GOODS Sourcing estate goods is still largely about buying directly from individual customers. For example, Coleman-Phelps says most of her estate items come from walk-in clients looking to sell.

Other retailers work with specific dealers to get the pieces they need. “We have a few vendors who go around the country to find pieces that speak to them,” says Robert Schwartz, manager of Harry Merrill & Son in Philadelphia, Pennsylvania, which deals in estate and custom work. “Otherwise, we get in pieces from customers who would rather trade their family estate pieces in for something more modern.”

When items come in, they often need a little attention due to wear and tear, he notes. So his staff works to restore the jewelry

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EDUCATING THE CONSUMER Teaching the customer about the product is an important part of the retail process. Schwartz notes that the level of customer education varies. “Most customers are emotionally drawn to estate pieces. They enjoy being told the history and time period of their own piece or the piece that they are buying. Other customers have specific interest in a certain time period or region

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IMAGE: HEATHER DURHAM PHOTOGRAPHY (WALTON’S ANTIQUE AND ESTATE)

“The Art Deco style is always the most popular.

It’s also the most replicated style in new jewelry”

SELLING THE ESTATE APPEAL

“[Clients] love that it’s one of a kind and that they’re not going to see someone with the exact same ring on”

A

where the jewelry was created, and will buy a piece based on their connection with the time.”

Many customers who shop estate are eager to learn, according to Garland. “Even people who come in for the emotional and aesthetic component appreciate the education. That being said, a lot of people come in with decent knowledge, because the tools to teach themselves are in their pockets.”

Coleman-Phelps finds herself educating sellers more often than buyers. “It’s usually the buyers who are more educated on what they want,” she says. “The sellers become educated when we help them determine what they want to do with their items.

We help them assess their items, and make sure they are 100% certain they want to sell [a piece] instead of keeping it.”

Still, she finds the process rewarding no matter what level of knowledge the client has. “When they don’t know what they have, we educate them. And when they do know, we can talk shop,” she says. “Jewelry is always emotional, so we handle both of these situations as an advocate, teacher and counselor.”

lack of education is the biggest hurdle when it comes to estate jewelry retailing, according to Edward A. Lewand, an independent appraiser of fine and antique jewelry. Retailers “need to learn how to market estate, and learn how to sell the history, the provenance, and the mystery,” asserts Lewand, who is also the director of the 33-year-old Jewelry Camp educational initiative. He offers the following tips:

•

Learn what estate looks like. Look at pieces for telltale signs such as hallmarks, trademarks, and evidence that a piece is handmade, he advises. “If a piece is flimsy, chances are, it’s not Cartier.” He also recommends books like The Illustrated Dictionary of Jewelry, which can help teach retailers how to identify estate pieces.

IMAGE: HEATHER DURHAM PHOTOGRAPHY (WALTON’S ANTIQUE AND ESTATE)

A LONG TIME TO COME Schwartz believes the trend of buying and wearing estate pieces is only getting started, because they fit with what today’s customers are looking for. “Estate jewelry pieces are often unique as well as romantic,” he says. “And many customers find the stories and histories of certain pieces to be the selling point.”

Another thing contributing to estate jewelry’s staying power is that the items are relatively durable, notes Garland. “Jewelry is intended to be enjoyed for generations. The inherent quality of jewelry materials means they can be worn for a long time.”

But she cautions that education is critical to ensuring the pieces stick around. “It’s not meant to be worn to the gym,” she asserts. “Not if you want it to last.” Accidental damage by underinformed wearers may eventually make some more delicate styles harder to find, she explains. “That comes with anything that’s older, though. There’s only so much of it made. And it’s becoming more expensive to buy.”

The segment’s future is also tied to economic factors. “I expect we’ll see an increase in both buying and selling estate if the economy softens,” says Coleman-Phelps. “Typically, if [someone] is selling, it’s because they need resources, or they want to utilize an estate price in order to make a purchase they may otherwise not be able to afford.”

Coleman-Phelps agrees with Garland that certain styles, including Art Deco and Georgian, may eventually become harder to find. “That might make the pricing for those styles go up,” she says. “However, as long as people are buying, there will be people selling.” ◼

•

Establish provenance. When retailers buy from private clients, it’s helpful to ask for as much documentation as possible. “Ask sellers if they have old insurance documents or prior old bills of sale,” says Lewand, adding that learning to recognize old mine and European cuts also helps establish age. Workmanship is a tell as well. “If you’re buying antique and estate, the piece will look [equally] well made on the front and the back.”

•

Set a price. After confirming era, provenance, materials and brand, retailers can look to auction houses to determine a fair price, Lewand says. “Go to websites like Sotheby’s and Christie’s and find comparable pieces, and see what the prices are.”

Edwardian turquoise necklace from Nelson Coleman Jewelers.

•

Be patient. “Never buy anything in haste,” he stresses. “You could be wrong, and it could cost you money, or you could be wrong and not pay the right amount, and it will be an issue.”

•

Be informed. “Don’t buy things you don’t understand or know about,” he says. “Take five minutes to do the research.” jewelrycamp.org

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RETAI L INSIG HT

G N I D L I BU AND BR V E LO rail

ly g o h e h e on t c i v d a Kauf r e e c h y s o r er offe anning. By J d i s n i An t pl of even

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G

ianna Gaudini once taped an executive’s shoes to his feet so he could skydive into the midst of an evening reception. Having spent almost a decade as an executive event producer for Google, Gaudini is currently global head of events for the Softbank Vision Fund and authored the recently released book The Art of Event Planning: Pro Tips from an Industry Insider. Here, she shares her behind-the-scenes expertise.

Planning a promotional event can be daunting. Where do you start?

How do you ensure that an event is on-brand?

The narrative of your event must be cohesive from the first touchpoint to the last. Everything you do has to be aligned with your brand message and who you are.

If you have the most beautiful brand in the world, your event should be Instagram-worthy. You’ll want to spend more on aesthetics and less on food. Is your brand service-driven? Then you have to convey the message “We care about you” with a personal greeting as soon as someone walks through the door. Are you promoting recycled diamonds and gold? Then be sure to avoid using plastic cups and other items that increase your environmental footprint.

I like to think of producing events as the art of making memories — ultimately, you want people to remember your event and then respond the way you want them to.

The first question to ask is, “Why are How important is personalization? you having the event?” Is it a product Personalization is the secret sauce of launch? A new store opening? events. Every guest should Understanding how your feel like a VIP. When event supports your goals you plan an event, put will help you allocate your yourself in the shoes of resources. the attendees. You know Then you need to define your goals, but you also your target audience. It have to figure out what will help you determine your attendees want out everything from the color of it. That means knowing scheme to the food. as much as possible Focus on strategy, and if about them. It is not the you need, get help with the quantity of the people, but creative elements. Check out the quality of the people Upwork, Fibre Creative and that you are reaching on a The Art of Event Planning TaskRabbit for affordable personal level that is going

by Gianna Gaudini. services. to help build your brand.

What is the biggest challenge when it comes to planning an event?

An event helps to build brand reputation.

It is the physical representation of your brand. Everything you do — from the aesthetics to the communication — is going to convey what your brand is. And if you do it right, you’ll create brand evangelists who will want to spread the word and come back. But if you do it wrong, there can be negative consequences.

As a brand, you want to be sure you stand out. Come up with a couple of words, and then when you are planning your event, ask yourself if these words are coming through in your message.

Another important question to ask is if people could identify with your brand if the logo were removed. If this brand could be any other, you have to start over again.

Is there a pace to a successful event?

The first thing you want to do is build excitement around your event. I like to offer something helpful or new in advance. Take into account your target’s preferences regarding communication.

Is a printed invite more appropriate than email? Whatever the medium, don’t come across as spammy.

Don’t be a lazy host during the event.

Don’t expect that people will do what you want them to do. Have a call to action to see your new diamond line. And follow up: After the event, contact a customer with the message, “I noticed that you were checking out this jewelry line. Is there anything I can show you?” You might even consider adding, “Would you like to borrow it and see how it works with the outfit you described?” Go above and beyond what other brands don’t do. ◼

FIVE TIPS

FOR HOSTING MEMORABLE EVENTS 1. Write a headline for your event.

Creating one headline forces you to zero in on the overarching message you want your attendees to take away from the event.

2. Identify the top three things you want people to remember.

Don’t sweat the details. Focus on three things that are important to you and make sure those things are done to the best of your ability — high quality, high impact — and go from there.

3. Wow with surprise and delight.

Be creative. Stage an Oscar award ceremony with a red carpet to showcase your jewelry.

Offer an unexpected giveaway. Place a ticket for a gift certificate or piece of jewelry randomly underneath several chairs.

Food is also an opportunity to expand the boundaries. Create a wall of cookies and cakes to whet their appetite for what’s to come.

4. Include some form of nostalgia for an emotionally enhanced experience.

Emotion drives action. Bring in a young violinist to play at your event. Partner with a nonprofit. Build an event around a TV show from a previous decade. Nostalgia can be a fun and memorable way for people to bond.

5. Balance technology and human interaction.

Incorporating interactive elements is a great engagement tactic that helps people buy into the experience. But it doesn’t always have to be technology. Invite customers to watch a chef prepare a dinner.

Place note cards under chairs with questions about gemstones, which you can use to begin a conversation and demonstrate your expertise.

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RETAI L RAP

WHAT IS THE BEST WAY TO HIRE AND RETAIN STAFF? Two retailers weigh in on how they find and hold on to good employees. By Phyllis Schiller JOEL SIEGEL

ANDREA BRAGG

CO-OWNER, SIEGEL JEWELERS GRAND RAPIDS, MICHIGAN

OWNER, FORSYTHE JEWELERS HILTON HEAD ISLAND, SOUTH CAROLINA It’s extremely difficult to know what an employee is going to be like from an interview. That’s when they are presenting the best version of themselves. And I don’t rely heavily on references, either, because people can receive a great reference, yet not be a great employee.

I tend to place value on less tangible cues.

“The first thing I look for is personality.

I want my team to be able to connect with our customers and put them at ease. I can teach someone the technical aspects of the position, advise them on the designers we carry and how to complete the sales transaction, but it’s how to develop relationships with our clients that is truly the important element. I’m looking for people who are good conversationalists, and sincere. When they talk to a client, the client needs to know that the sales associate is looking out for their best interest. You can’t get that same feeling when you’re ordering something online.

“In terms of keeping employees, I’m extremely transparent. As the owner of the business, I’m in the store every day. I share a lot of information with my staff. And I value their opinions; I ask for their assistance in selecting new products. I really value their feedback. They’re the ones who are on the sales floor. If they have concerns, I want them to feel that they can come to me; it’s a two-way street. We have a weekly staff meeting where I share our financial information — month-to-date and annual sales, what’s trending, and upcoming events.

We’re a small store, so it’s a small staff. But they know everything that’s going on.

“I want to surround myself with staff who enjoy being around people, love what they do, and want to come to work because they care about our customers.”

I try to find the best people to hire to start with, of course. We don’t do a lot of formal training. If we were to sit a person down for three days and teach them everything they needed to know, they would probably retain only about 10%.

Instead, we basically have new employees shadow another staff member. This way, they can absorb what they need to know in smaller doses, a little at a time, in a way that allows them to really see how we do things here.

“We’re a single store, so there is an opportunity to take on new duties and responsibilities. There are ways to move up within the store, depending upon seniority and individual skill sets.

“Some people are more right-brain-oriented and some are left-brain. The attributes that I look for would be the ability to retain good product knowledge, as well as to be skilled at dealing with the processing of a purchase, including the paperwork and keeping track of all the details of an order. But most of all, the person should have good people skills.

Being detail-oriented isn’t enough if they can’t relate to the clients walking into the store. Ideally, I would want a mixture of younger and older staffers, so that customers of different ages can find a salesperson with whom they are comfortable.

“Over the past few years, we have had several employees who had been with the store for 30 or 40 years retire. We’re not necessarily seeing that type of long-term employment happening now. But that situation is not just happening here, it’s in any industry today.

“We give our people quite a bit of independence, so they don’t feel like we are constantly looking over their shoulders. They need to feel empowered to make decisions and deal with situations as they arise.”

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