Highlights from Friday’s Rapaport TradeWire
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Happy 4th of July everybody!
From Rapaport:
Interesting “Retail Quote” this week:
“Well, the traffic on comScore shows us down 9 percent. Our numbers, actually — our internal numbers — our traffic is a little bit up, about 2 percent. So…the conversion is about the same, but the average ticket size drops. People who used to — one cohort of customers who normally comes in twice a year and buys a $300 jewelry item, they’re coming in, but they’re buying a $180 jewelry item. And we see that sort of across the board, that kind of change.”— Patrick ByrneChief executive officer (CEO) of overstock.com
This next quote seems to fly in the face of all the evidence out there. It also doesn’t square with the fact that the prices in the ultra-expensive diamond market have completely collapsed.
The annual world wealth report produced by Capgemini and Merrill Lynch found that the highest net worth people in the world lost an average of 19.5 percent of their wealth in 2008. Lifestyle spending by high net worth individuals was significantly reduced in 2008, but this demographic actually stepped up its investment buying of jewelry and other luxury items that are seen as a safe place to keep money, increasing these kinds of purchases beyond pre-recession levels.
Amazingly, diamond demand has actually increased in the past year in India:
With prices of polished diamonds slumping as much as 15 percent during this recession, in India they are increasingly being bought for investment purposes. Domestic consumption of diamonds has doubled during the past three months, from 2 percent to 4 percent of total production. Demand for diamond jewelry has also increased significantly during the past year. Jewelry demand rose by 25 percent domestically in the past three years, and by approximately 5 to 10 percent in the last year.
