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Jewellery & Watches Retailing - UK - September 2017

“The UK jewellery and watch market looks set to become increasingly challenging. Prices are rising and domestic demand is softening as a result. Growth in the market is being driven by sales of luxury watches amongst tourists taking advantage of a weak Sterling. However, one in four UK consumers plan to spend more on jewellery and watches in the next year. Retailers set to capture this spending are those targeting affluent, young shoppers but this means the mid to high end of the market is set to become increasingly competitive.”
– Samantha Dover, Retail Analyst

This Report looks at the following areas:

  • The ongoing impact of Brexit on the market
  • Watches continuing to drive growth, but the market is increasingly competitive
  • What are the opportunities in the market?

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • Market set to reach £5.5 billion in 2017
              • Figure 1: Best- and worst-case forecast value sales of jewellery and watches, 2012-22
            • Watches outperform jewellery
              • Figure 2: Estimated share of total UK jewellery and watch market, 2016
            • Hallmarking in the UK declines 7.1% in 2016
              • Companies and brands
                • Aurum overtakes Signet to become market leader
                  • Cartier stands out for consistent quality
                    • Figure 3: Attitudes towards and usage of selected brands, July 2017
                  • Leading brands target new audiences
                    • The consumer
                      • Self-purchasing drives watch market
                        • Figure 4: Purchasing of jewellery and watches, July 2017
                      • More people shopping online
                        • Figure 5: Where people shop for precious metal jewellery and watches, in-store or online, July 2017
                      • Pandora and Argos the most shopped at retailers
                        • Birthdays are a popular gifting occasion
                          • Figure 6: Occasions people buy jewellery and watches as a gift, July 2017
                        • Necklaces drive the jewellery market
                          • Figure 7: Types of jewellery purchased, July 2017
                        • People research online ahead of purchase
                          • Figure 8: Jewellery and watch shopping behaviour, July 2017
                        • What we think
                        • Issues and Insights

                          • The ongoing impact of Brexit on the market
                            • The facts
                              • The implications
                                • Watches continuing to drive growth, but the market is increasingly competitive
                                  • The facts
                                    • The implications
                                      • What are the opportunities in the market?
                                        • The facts
                                          • The implications
                                          • The Market – What You Need to Know

                                            • Sales of jewellery and watches rise 2.3% in 2016
                                              • Luxury watch market boosted by weak Sterling and rising inbound tourism
                                                • Uplift in Swiss watch exports to the UK
                                                  • Decline in hallmarking highlights challenges in precious metal market
                                                    • Precious metal prices rise in 2016
                                                    • Market Size and Forecast

                                                      • Jewellery and watch market forecast to reach £6.1 billion by 2022
                                                        • Figure 9: Best- and worst-case forecast value sales of jewellery and watches, 2012-22
                                                        • Figure 10: Value sales of watches and jewellery, at current and constant prices, 2012-22
                                                      • Forecast methodology
                                                      • Market Segmentation

                                                        • Sales of watches expected to rise 5.1% in 2017
                                                          • Figure 11: Estimated share of total UK jewellery and watch market, 2016
                                                          • Figure 12: UK retail value sales of jewellery and watches, by sector, 2012-17
                                                      • Market Drivers

                                                        • Rising inflation puts pressure on consumers
                                                          • Figure 13: Real wages growth – Percentage change in average weekly earnings vs inflation, August 2014-July 2017
                                                        • Consumer confidence weakening
                                                          • Figure 14: How consumers would describe their financial situation, August 2016-July 2017
                                                        • Consumer spending priorities
                                                          • Figure 15: What consumers spend their extra money on, July 2017
                                                        • An ageing population threatens market
                                                          • Figure 16: Trends in the age structure of the UK population, 2014-24
                                                          • Figure 17: Trends in the age structure of the UK population, 2014-24
                                                        • Gifting opportunities
                                                          • Declining birth and marriage rate
                                                            • Figure 18: Total number of births in the UK, 2011-15
                                                            • Figure 19: Total number of marriages in the UK, 2011-15
                                                          • Rising number of people visiting the UK
                                                            • Figure 20: Total overseas residents’ visits to the UK, 2012-16
                                                            • Figure 21: Total overseas residents’ visits to the UK, by purpose of visit, 2012-16
                                                            • Figure 22: Overseas residents’ spending in the UK, by purpose of visit, 2012-16
                                                          • Increasing smartwatch ownership
                                                            • Figure 23: Ownership of mobile phones and smartwatches, 2015-17
                                                          • Swiss watch exports decline, but exports to the UK increase
                                                            • Figure 24: Value of Swiss watch exports, by watch type, 2012-16
                                                          • Gold and silver prices return to growth in 2016
                                                            • Declining hallmarking in the UK
                                                              • Figure 25: Percentage change in number of items hallmarked, by precious metal type, 2015-16
                                                          • Companies and Brands – What You Need to Know

                                                              • Leading brands reposition to attract new customers
                                                                • Growing emphasis on travel retail
                                                                  • Plenty of innovation in the watch market
                                                                    • Cartier and Sekonda benefit from strong brand awareness
                                                                    • Leading Specialist Retailers

                                                                      • Sales performance
                                                                        • Figure 26: Leading specialists’ revenues, 2011-16
                                                                      • Outlet numbers
                                                                        • Figure 27: Leading specialists’ outlet numbers, 2011-16
                                                                      • Sales per outlet
                                                                        • Figure 28: Leading specialists’ sales per outlet, 2015
                                                                        • Figure 29: Leading specialists’ sales per outlet, 2011-16
                                                                    • Competitive Strategies

                                                                      • Mergers and acquisitions
                                                                        • Aurum Holdings buys major US jewellers
                                                                          • Movado Group acquires Olivia Burton
                                                                            • Theo Fennell saved from administration
                                                                              • Breitling bought by London-based investment group
                                                                                • Distribution changes
                                                                                  • Tapping into the travel retail market
                                                                                    • Signet limiting investment in smaller shopping centres
                                                                                      • Ralph Lauren postpones plans to build UK wholesale-to-retail channel for watches
                                                                                        • Thomas Sabo debuts new store concept
                                                                                          • Online developments
                                                                                            • Net-a-Porter strengthens online jewellery and watch offer
                                                                                              • Jewellers experiment with chatbots
                                                                                                • Brand positioning
                                                                                                  • Tiffany & Co. targets younger audience
                                                                                                    • Aurum focusing on prestige as opposed to fashion products
                                                                                                      • Signet targeting growth in mid-market
                                                                                                        • Fraser Hart also eyes mid to high-end market
                                                                                                          • Links of London reveals new strategy
                                                                                                            • Store investment
                                                                                                              • Department stores increase watch selling space
                                                                                                                • Mono-brand stores increasingly important in the UK watch retail landscape
                                                                                                                  • Casio unveils new G-Shock store
                                                                                                                    • Figure 30: G-Shock store on Carnaby Street, London, 2017
                                                                                                                  • A new flagship for Mappin & Webb
                                                                                                                  • Launch Activity and Innovation

                                                                                                                    • New players in the UK jewellery market
                                                                                                                      • Figure 31: Glitzbox at Old Street Station, London, 2017
                                                                                                                    • Wearable technology and product innovation
                                                                                                                      • Louis Vuitton and Movado enter the smartwatch market
                                                                                                                        • New smartwatch targets visually impaired consumers
                                                                                                                          • Casio reveals new time-sync technology
                                                                                                                            • Apple Watch vs Google Android Wear
                                                                                                                              • Personalisation gains momentum in watch market
                                                                                                                                • Extend my Brand
                                                                                                                                  • Capturing data with retail technology
                                                                                                                                    • Department stores bolster offer with pop-up shop-in-shops
                                                                                                                                      • Jewellers embrace the Experience is All Trend
                                                                                                                                        • Celebrity lines gain momentum
                                                                                                                                          • Non-specialists boost weddings jewellery offer
                                                                                                                                            • Tapping into demand for ethical products
                                                                                                                                            • Advertising and Marketing Activity

                                                                                                                                              • Above-the-line spending declines in 5.6% in 2016
                                                                                                                                                • Figure 32: Total above-the-line, online display and direct mail advertising expenditure on jewellery and watches, 2012-16
                                                                                                                                              • Richemont ramps up advertising expenditure
                                                                                                                                                  • Figure 33: Total above-the-line, online display and direct mail advertising expenditure on jewellery and watches, by advertiser, 2012-16
                                                                                                                                                • Less emphasis on press advertising
                                                                                                                                                  • Figure 34: Total above-the-line, online display and direct mail advertising expenditure on jewellery and watches, by media type, 2016
                                                                                                                                                  • Figure 35: Total above-the-line, online display and direct mail advertising expenditure on jewellery and watches, by media type, 2012-16
                                                                                                                                                • Key campaigns
                                                                                                                                                  • Ongoing repositioning at Tiffany & Co
                                                                                                                                                    • Fraser Hart targets mid to high-end market with new advertising message
                                                                                                                                                      • Harvey Nichols highlights rare jewellery in new campaign
                                                                                                                                                        • Pandora unveils experiential Valentine’s campaign
                                                                                                                                                          • Swarovski taps into influencers
                                                                                                                                                            • Nielsen Ad Intel coverage
                                                                                                                                                            • Brand Research

                                                                                                                                                                • Brand map
                                                                                                                                                                  • Figure 36: Attitudes towards and usage of selected brands, July 2017
                                                                                                                                                                • Key brand metrics
                                                                                                                                                                  • Figure 37: Key metrics for selected jewellery and watch brands, July 2017
                                                                                                                                                                • Brand attitudes: Cartier known for consistent quality
                                                                                                                                                                  • Figure 38: Attitudes, by brand, July 2017
                                                                                                                                                                • Brand personality: Sekonda seen as accessible
                                                                                                                                                                  • Figure 39: Brand personality – Macro image, July 2017
                                                                                                                                                                • Links of London viewed as stylish
                                                                                                                                                                  • Figure 40: Brand personality – Micro image, July 2017
                                                                                                                                                                • Brand analysis
                                                                                                                                                                  • Sekonda garners highest levels of trust
                                                                                                                                                                    • Figure 41: User profile of Sekonda, July 2017
                                                                                                                                                                  • Links of London’s style credentials stand out
                                                                                                                                                                    • Figure 42: User profile of Links of London, July 2017
                                                                                                                                                                  • Tissot benefits from its good reputation
                                                                                                                                                                    • Figure 43: User profile of Tissot, July 2017
                                                                                                                                                                  • Cartier’s exclusivity sets it apart
                                                                                                                                                                    • Figure 44: User profile of Cartier, July 2017
                                                                                                                                                                  • TAG Heuer is a trendsetter
                                                                                                                                                                    • Figure 45: User profile of TAG Heuer, July 2017
                                                                                                                                                                  • Olivia Burton expresses the wearer’s personality
                                                                                                                                                                    • Figure 46: User profile of Olivia Burton, July 2017
                                                                                                                                                                  • Ti Sento suffers from low brand awareness
                                                                                                                                                                    • Figure 47: User profile of Ti Sento, July 2017
                                                                                                                                                                • The Consumer – What You Need to Know

                                                                                                                                                                  • Purchasing peaks amongst young and affluent
                                                                                                                                                                    • Rising number of people shopping online
                                                                                                                                                                      • Birthdays primary reason for gifting
                                                                                                                                                                        • Necklaces have a broad appeal
                                                                                                                                                                          • Strong demand for ethically sourced jewellery
                                                                                                                                                                          • Purchasing of Jewellery and Watches

                                                                                                                                                                            • Young people drive the jewellery and watch market
                                                                                                                                                                              • Figure 48: Consumers who have bought jewellery and/or watches in the last five years, by demographics, July 2017
                                                                                                                                                                            • Precious metal jewellery a popular choice for gift buyers
                                                                                                                                                                              • Figure 49: Purchasing of jewellery and watches, July 2017
                                                                                                                                                                            • Popularity of silver amongst female buyers prevails
                                                                                                                                                                              • Figure 50: Purchasing of precious metal jewellery in the last five years, by age and gender, July 2017
                                                                                                                                                                            • Older men choose to gift gold jewellery
                                                                                                                                                                              • Figure 51: Purchasing of precious metal jewellery in the last five years, by age and gender, July 2017
                                                                                                                                                                            • Revived watch interest amongst older men
                                                                                                                                                                              • Figure 52: Purchasing of watches in the last five years, by age and gender, July 2017
                                                                                                                                                                            • Rising number of women buying into smartwatch trend
                                                                                                                                                                              • Figure 53: Purchasing of watches in the last five years, by age and gender, July 2017
                                                                                                                                                                            • One in five young men buy costume jewellery for themselves
                                                                                                                                                                              • Figure 54: Purchasing of costume jewellery in the last five years, by age and gender, July 2017
                                                                                                                                                                            • A third buy just one type of jewellery or watches
                                                                                                                                                                              • Figure 55: Repertoire of jewellery and watch purchases, July 2017
                                                                                                                                                                          • Where They Shop for Jewellery and Watches

                                                                                                                                                                            • People still prefer to shop in-store…
                                                                                                                                                                              • Figure 56: Where people shop for precious metal jewellery and watches, in-store or online, July 2017
                                                                                                                                                                            • …but a rising number of people are shopping online
                                                                                                                                                                              • Figure 57: Where people shop for precious metal jewellery and watches, in-store or online, July 2016 and July 2017
                                                                                                                                                                            • Men drive online purchases
                                                                                                                                                                              • Figure 58: Where people shop for precious metal jewellery and watches, in-store or online, by gender, July 2017
                                                                                                                                                                            • Online also popular amongst older consumers
                                                                                                                                                                              • Figure 59: Where people shop for precious metal jewellery and watches, in-store or online, by age, July 2017
                                                                                                                                                                            • The popularity of Pandora confirmed
                                                                                                                                                                              • Figure 60: Retailers used to buy precious metal jewellery in the last five years, July 2017
                                                                                                                                                                            • Online-only retailers’ strength in the watch market
                                                                                                                                                                              • Figure 61: Retailers used to buy watches in the last five years, July 2017
                                                                                                                                                                            • Fashion retailers dominate costume jewellery sales
                                                                                                                                                                              • Figure 62: Retailers used to buy costume jewellery in the last five years, July 2017
                                                                                                                                                                            • Retailer loyalty higher amongst watch buyers
                                                                                                                                                                              • Figure 63: Repertoire of retailers used for buying jewellery and watches, July 2017
                                                                                                                                                                          • Occasions Jewellery and Watches are Purchased

                                                                                                                                                                            • Half of gift shoppers buy for birthdays
                                                                                                                                                                              • Figure 64: Occasions people buy jewellery and watches as a gift, July 2017
                                                                                                                                                                            • Women more likely to gift at Christmas
                                                                                                                                                                              • Figure 65: Occasions people buy jewellery and watches as a gift, by gender, July 2017
                                                                                                                                                                            • Millennials drive Valentine’s purchases
                                                                                                                                                                              • Figure 66: Occasions people buy jewellery and watches as a gift, by age, July 2017
                                                                                                                                                                            • Less affluent gift at Christmas
                                                                                                                                                                              • Figure 67: Occasions people buy jewellery and watches as a gift, by socio-economic status, July 2017
                                                                                                                                                                            • Almost a fifth buy for multiple occasions
                                                                                                                                                                              • Figure 68: Repertoire of occasions people buy jewellery and watches as a gift, July 2017
                                                                                                                                                                          • Types of Jewellery Purchased

                                                                                                                                                                            • Necklaces most popular style of jewellery
                                                                                                                                                                              • Figure 69: Types of jewellery purchased, July 2017
                                                                                                                                                                            • Necklaces and earrings have broad appeal
                                                                                                                                                                              • Figure 70: Types of jewellery purchased, by age and gender, July 2017
                                                                                                                                                                            • Bracelets popular purchase for older males
                                                                                                                                                                              • Figure 71: Types of jewellery purchased, by age and gender, July 2017
                                                                                                                                                                            • One in five buy four or more types of jewellery
                                                                                                                                                                              • Figure 72: Repertoire of types of jewellery purchased, July 2017
                                                                                                                                                                          • Jewellery and Watch Shopping Behaviour

                                                                                                                                                                            • Growing appetite for ethical jewellery
                                                                                                                                                                              • Figure 73: Jewellery and watch shopping behaviour, July 2017
                                                                                                                                                                            • Men willing to spend more on personalisation, women on unique designs
                                                                                                                                                                              • Figure 74: Agreement with jewellery and watch shopping behaviour statements, by gender, July 2017
                                                                                                                                                                            • Fashion trends important to young people
                                                                                                                                                                              • Figure 75: Agreement with jewellery and watch shopping behaviour statements, by age, July 2017
                                                                                                                                                                            • Young and affluent plan to spend more in future
                                                                                                                                                                              • Figure 76: Agreement with the statement ‘I am planning to spend more on jewellery/watches in the next year’, by demographics, July 2017
                                                                                                                                                                          • CHAID Analysis

                                                                                                                                                                            • Methodology
                                                                                                                                                                              • Targeting affluent young with personalisation
                                                                                                                                                                                • Figure 77: Jewellery and watches – CHAID – Tree output, July 2017
                                                                                                                                                                                • Figure 78: Jewellery and watches – CHAID – Table output, July 2017
                                                                                                                                                                            • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                                                • Abbreviations
                                                                                                                                                                                  • Consumer research methodology
                                                                                                                                                                                  • Appendix – Market Size and Forecast

                                                                                                                                                                                    • Forecast methodology

                                                                                                                                                                                    Jewellery & Watches Retailing - UK - September 2017

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