It just seems to me that having a genuinely ethical and sustainable product can only be a good thing for our industry. This January Cred Jewellery reported a 330% increase in UK Fair-trade gold sales and this follows on from a 60% increase in bridal sales in the first half of 2015. This is inline with trends across many consumer industries and looks set to continue.
We consider fine jewellery sales as a considered purchase and I take that to mean that when people are making the decision about purchasing they are considering both the pros and cons, to an extent because of the amount of money involved. In this day an age there are many of both, most pressingly, in my observations, the housing crisis. I know plenty of couples who are putting off the purchase of an engagement or wedding rings, or spending less than they would like to because they are saving for a deposit and in places like London especially, there isn’t room in the budget for fine jewellery. I don’t think making our product more ethical will solve the housing crisis but when people are evaluating the pros and cons I think its in our interest to make sure ethics are in the pros section rather than the cons. It may well tip the balance in favor of making the purchase or not.
People start ‘considering’ their purchase before they enter the shop environment and a lot of re-search is done on-line where it is not hard to find a negative article about some aspect of the jewellery supply chain. There are some very determined people out there who draw attention to the issues and with the increasing political awareness and activism, partly inspired by the rise of the hard left in the labour party, I don’t see this abating. Having a properly traceable supply chain can give us a really good answer to these issues, if people raise them.
I understand that there is a cost involved in signing up for fairtrade gold and the metal costs more but it seems to me that the value it adds to the product and your business makes it worthwhile. Adding anything to your business costs money and with the growth in awareness in fairtrade metal making it likely to drive sales I can only imagine it having a positive impact.
I know some will be reluctant to put fairtrade metal next to non certified metal but the evidence shows from other products that have been made fairtrade, that it encourages the certification of more of the market and there is still a place for non certified products, customers appreciate choice and for some cost will still come out on top. If you take coffee, sales in UK of fairtrade coffee have jumped from £15.5m in 2000 to £194m in 2011 and has risen since. Coffee is clearly different to fine jewellery but all indications are that we could experience the same growth and the rise of fairtrade products hasn’t dampened the demand for coffee as a whole. If the price difference worries you, maybe to reduce the difference in cost you could pass on the social premium but not mark it up. The idea of a reduced margin may not sound appealing but if it helps to drive sales in in such a high growth area then the result will be, you make more money. I see bridal jewellery as a particular area where this will help to drives sales and it is a really good opportunity to enter a growth market. By tapping into a growing trend it doesnt even mean short term sacrifice for long term gain. I am by the way not predicting collapse or calamity if we don’t take the lead on this, I just feel very much that we are missing a trick.
In the short-term I think it is a growth market for UK jewellers and it fits in with the family business narrative so well, as an industry we can add so much glamour to the fairtrade label. I see it as a hugely beneficial relationship for both parties. I’m a little young to remember myself but, by all accounts the first fairtrade coffee wasn’t great and it has taken years to shake off that tag. For the fine jewellery industry, with its reputation for quality to embrace the label will surely help the fairtrade labels image, and the trusted fairtrade label will help the jewellery industry. If we market the collaboration as well as diamonds have been marketed in the past then we could be on a winner at the same time as helping people in mining communities. Which brings me onto why I think making the ethical switch will benefit the diamond industry as a whole and on a more long-term basis.
Cartier boss Johan Rupert spoke in July of his fears that growing inequality in the world could lead to ‘hatred and envy’ and that the destruction of the middle class is a threat to the world and the luxury industry. He predicts that in the face of huge inequality, those with wealth will shy away from luxury goods for fear of exposing their wealth and that general instability will threaten the world economy. You can read more here.
I think he has a point, history has shown that when inequality does get too great the ‘poor’ do rise and in a time where 0.1% of the world’s population owns more wealth than the other 0.99% its not inconceivable that it could happen again. In all the reporting of his comments the press have hinted at the irony of a man worth $7.5bn speaking about inequality, but that doesn’t make what he is saying untrue. Maybe he has a plan to re-distribute wealth and help maintain stability. If he has identified it as being in his interest to do so then maybe there is a plan.
The housing crisis in the UK is a less apocalyptic way that we see the effects of his prediction playing out. The squeeze on the middle class and on the young I’m sure is affecting sales of fine jewellery but not because of a fear of exposing wealth, it has more to do with being on a tight budget. I think its the potential of emerging markets where this could be most damaging. With China slowing and with the luxury brands that have done so well in that market place and have invested so much, reporting a continuing decline, brands may be looking to the next, or the next boom market for luxury goods. Where will this be?
With 6 of the worlds 13 fastest growing economies being in Africa I would imagine that its crossed a few minds that Africa could be one such market but it is here that the wealth inequality is at its most extreme, yet it is a source of so many raw materials and not just for the luxury industry.
If the creation of a stable middle class is so advantageous for the luxury industry then could we not start by increasing wages and improving conditions in Africa’s mining sector as well as adding value to the exported product?. In Australia the mining industry is famed for its high wages and has played a pivotal role in the countries economic success, not only as a big contributor to the countries exports but as a provider of highly paid jobs. I know Australia and Africa are very different places, and that Africa is an incredibly varied continent in itself but the concept of paying people a fair wage to create a society where everyone has a stake and an opportunity to increase wealth seems to work in most places. In making steps to improve our supply chain and image as an industry now, can we help to set the stage for a new market in the future ?. The mining sector cant do it alone but with so many natural resources in the continent it can certainly play a part.
Tackling wealth inequality is often cited as one of the biggest issues of our day after global warming and its seems to me that it is in the luxury sectors interests to tackle it. This is a long-term view but the jewellery industry is an industry with a long-term view, whether its convincing share holders of long-term prospects or ensuring that the family business you pass on to the next generation has a future. Our products and narrative are built on commitment and a sense of being permanent – ‘a diamond is forever’, so an eye on the future is beneficial.