Platinum
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PGI offers recession-beating platinum sales tips
July 23, 2009
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| Platinum engagement ring by Roberto Coin. |
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New York--With bridal shaping up as a hot category for recession-weary jewelers, and with platinum prices now at a comfortable, margin-friendly groove of just below $1,200 per ounce, selling more of the hefty precious metal just might be easier than jewelers think.
At a trade press luncheon in New York on Wednesday, Platinum Guild International-USA (PGI) offered its top 10 recession-beating tips for selling platinum.
1. Enter the bridal customer's parallel universe. Since bridal customers are in love and feeling optimistic, PGI suggests that jewelers don't burst the bubble by assuming they do not want or cannot afford platinum. Instead of price, make the bridal sale based on the value and beauty of the piece, the guild advises. Jewelers should also remember to use the drop test so that customers can feel the white metal's heft and see for themselves what makes platinum stand out.
2. Get out of the jewelry business and into the "business of jewelry." Examine where the dollars in your business come from by analyzing your sales by metal type and margin dollars, rather than by gross margin percentages. Bear in mind that even if margins are lower on a certain product, that product might still pull in more dollars if its price is higher. Target value versus volume, and remember that most platinum sales are special order, PGI advises. Jewelers can also think of platinum as a tool to help enrich the profitability of their merchandise mix.
3. Sell to higher margins first. PGI asserts that since platinum settings return more margin dollars than the same settings in white gold or palladium, jewelers should present platinum first because it is easier to trade down to a less expensive item.
4. Treat bridal customers like they are your last. It takes as much time to sell a $400 setting as a $1,500 setting, and retailers should never underestimate a customer's ability to pay a little more if they understand value. Make sure salespeople are trained to explain platinum value with conviction and confidence.
5. Take back the wedding. For jewelers, the biggest competition comes from other wedding day expenses, which, unlike jewelry, only last for the day. Meanwhile, 40 percent of consumers do not purchase their engagement ring and wedding band from the same retailer, PGI says. After selling a platinum engagement ring to the groom, invite both the bride and the groom back to the store for the wedding band purchase, PGI suggests.
6. Turn a misunderstanding about platinum into a positive. Many sales associates misunderstand platinum patina, the soft finish that develops on a platinum ring with wear. When platinum is scratched, the metal is merely displaced, and its surface becomes harder and more resistant. The patina--consider it the history of a life well lived--develops. Managers should help staffers value the distinctive color and tone of patina and how it enhances the ring over time.
7. Don't think of platinum as just "another white metal." Identifying platinum as simply a white metal option undersells the merchandise and undermines profitability, PGI says. Remember that a groom's objective is to make the bride happy, and numerous surveys have shown that more women prefer platinum, PGI says.
8. Train. Train. Train. PGI training is not only highly valued, it also inspires and engages sales associates, giving them a heightened desire to sell platinum. Seek new ways to help sales associates promote and talk about platinum's attributes and benefits. Encourage them to start with platinum, then show the other options, PGI says.
9. Platinum signage reinforces a jeweler's commitment to quality and prompts dialogue. Platinum product in-store can get lost in a sea of white, even to sales associates. Clearly marked platinum acts as a prompt to both customers and sales associates, and it also boosts the likelihood of making a sale and gives consumers a sense that the goods inside the store are high quality.
10. Strong online presence is essential. On average, customers visit 20 Web sites before entering a store, and platinum customers have the highest online usage, says PGI. Therefore, retailers should use the Web to educate consumers about their store and their products. PGI also suggests that retailers become a Preferred Platinum Partner and drive customers to their store via PreciousPlatinum.com.
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More Platinum News
Global net jewelry demand for platinum is expected to climb by almost 80 percent this year to 2.45 million ounces, with increased interest primarily from Japan and China, according to a new report from Johnson Matthey. Read More
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