Diamond Jewelry Sales Rise in First Quarter

June 18, 2002

Diamond Jewelry Sales Rise in First Quarter

U.S. retail sales of diamond jewelry increased 5% in the first quarter of 2002, as compared to the first quarter of 2001, says the Diamond Information Center. The first quarter usually accounts for about 20% of total diamond jewelry sales for the year.

The key driver of this increase was volume growth, demonstrated by a 10% increase in the number of diamond jewelry pieces sold during the first quarter of 2001. "While comparisons were made easier given the weakness of the same period last year, first quarter volume in 2002 was even higher than the record-setting first quarter of 2000," says Seth Grossman, director of market planning for the diamond group at J. Walter Thompson. "We certainly consider this not only an encouraging sign for future sales but a testament to the enduring emotional power of a diamond."

According to Grossman, growth in the first quarter of 2002 was driven by strong retail sales during the Valentine's Day sales period. As in the fourth quarter of 2001, the two key growth categories, diamond ear studs and three-stone diamond jewelry, continued to exhibit strength in the first quarter of 2002.

The Signet Group, which operates Kay Jewelers and Jared stores among others in the U.S., announced its U.S. same-store sales increased 6.6% in its first quarter, February to May. Sales were helped by a significant marketing event, reports Signet. Total sales in the U.S. operations increased by 15.2%. Gross margin eased, as anticipated, reflecting changes in the stores' sales mix. "Our U.S. business had a very encouraging quarter, capitalizing on its competitive strengths, and again increased market share," says Terry Burman, group chief executive. "The trading environment in the U.S. showed some improvement although economic indicators are still inconsistent and the outlook somewhat uncertain."

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