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The UK Watch and Jewellery Market - September 2012

  • To what extent are alternative devices, such as mobile phones, threatening the watches market?
  • How important is gifting to the watches and jewellery market?

About the UK Jewellery Market

The watches and jewellery market is facing tough times as slower consumer spending combined with rising precious metal prices and raw material costs have taken their toll on the sector. As a result, Mintel estimates that market growth in 2012 will remain almost flat as consumers continue to spend cautiously in the uncertain economic climate and rising average selling prices of both jewellery and watches deter people from self-purchases.

The sector has nevertheless remained resilient and is not in decline, as gifting remains a reliable source of sales, with watches and jewellery considered to be a great present for a special occasion. Consumer research shows that two fifths of consumers who have bought jewellery in the last five years enjoy receiving precious metal jewellery as a gift and almost a quarter (24%) of consumers enjoy receiving a watch as a present. 

The soaring price of gold and silver has led to a decline in volume sales of precious metal jewellery, with the self-purchasing market worst hit as women are less prepared to pay the high prices for fine jewellery and are opting instead for costume jewellery. As demand for fashion and branded jewellery grows, having become an accepted alternative to precious metal jewellery among all ages and socio-economic groups, high street jewellers and retailers have responded by selling it alongside their precious metal ranges. 

While watches remain highly desirable products, with over 50% of adults considering Rolex to be one of their most desired watch brands, watch ownership continues to decline. Almost a quarter of consumers (24%) in 2012 prefer to use a mobile phone to tell the time rather than a watch, increasing from just under a fifth (18%) in 2011. Nevertheless, men continue to buy watches as an alternative to jewellery and they remain a relevant part of the fashion and accessories market. 

This report looks at where people buy precious metal jewellery, the most desired watch brands and consumer attitudes towards purchasing jewellery and watches.

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Table of contents

  1. Introduction

      • Definitions
        • Abbreviations
        • Executive Summary

            • The market
              • Figure 1: Best- and worst-case forecast value sales of watches and jewellery, 2007-17
            • Market sees flat sales growth
              • Market factors
                • Four fifths own a watch, but ownership in decline
                  • Figure 2: Trends in ownership of watches compared to mobile phones, 2007-11
                • Price of gold keeps rising
                  • Figure 3: Average price of gold and platinum, 2002-11
                • Growth in 25-34s provides boost, while ageing population is a challenge
                  • ABs help drive sales
                    • Declining number of marriages to impact ring purchases
                      • The consumer
                        • High street jewellery chains first choice
                          • Figure 4: Preferred outlets for buying jewellery, July 2012
                        • A precious gift
                          • Figure 5: Attitudes towards precious metal jewellery, by gender, July 2012
                        • Women want unique designs
                          • Jewellery as an investment
                            • Awareness in hallmarking rises
                              • Figure 6: Attitudes towards precious metal jewellery, by age and socio-economic group, July 2012
                            • Concerns about buying online
                              • Rolex is one of the most desirable watch brands
                                • Figure 7: Most desirable watch brands, by age and affluence, July 2012
                              • Mobile phones threaten the market
                                • Figure 8: Agreement with statement ‘I prefer to use a device such as a mobile phone to tell the time’, by age group and socio-economic group, July 2012
                              • Older consumers mainly buy as a replacement
                                • Gifting drives sales
                                  • Consumers browse online, but buy in-store
                                    • What we think
                                    • Issues in the Market

                                        • How is the rising price of precious metals impacting on sales of jewellery?
                                          • What is being done to tackle the rise in sales of counterfeit jewellery?
                                            • To what extent are alternative devices, such as mobile phones, threatening the watches market?
                                              • How important is gifting to the watches and jewellery market?
                                              • Trend Applications

                                                  • Trend: Prepare for the Worst
                                                    • Trend: Objectify
                                                      • 2015 Trend: Access Anything Anywhere
                                                      • Market Drivers

                                                        • Key points
                                                          • Four fifths own a watch, but ownership in decline
                                                            • Figure 9: Trends in ownership of watches, 2007-11
                                                          • Mobile phone ownership continues to rise
                                                            • Figure 10: Ownership of watches and mobile phones, by age and socio-economic group, 2011
                                                            • Figure 11: Trends in ownership of watches compared to mobile phones, 2007-11
                                                          • Men spend more than women on watches
                                                            • Figure 12: Trends in amount spent on watches in the last 12 months, 2007-11
                                                            • Figure 13: Trends in amount spent on watches in the last 12 months, by gender, 2007-11
                                                          • Price of gold keeps rising
                                                            • Figure 14: Average price of gold and platinum, 2002-11
                                                          • Weight of hallmarked gold declines
                                                            • Figure 15: Weight of gold hallmarked by all UK assay offices, 2002-11
                                                          • Price of silver rockets
                                                            • Figure 16: Average price of silver, 2002-11
                                                          • Growing interest in palladium
                                                            • Gold ownership falls
                                                              • Figure 17: Ownership of jewellery, by type of metal, 2007-11
                                                              • Figure 18: Ownership of gold or platinum jewellery* and silver jewellery, 2007-11
                                                            • Men gift gold, while women give silver
                                                              • Figure 19: Trends in ownership of gold or platinum jewellery and silver jewellery, 2007-11
                                                            • Amount spent on gold rises
                                                              • Figure 20: Trends in amount spent on gold or platinum jewellery, not diamond set, in the last 12 months, 2007-11
                                                            • Amount spent on silver declines
                                                              • Figure 21: Trends in amount spent on silver jewellery in the last 12 months, 2007-11
                                                            • Costume jewellery universally popular
                                                              • Fall in fashion-driven under-25s likely to affect market
                                                                • Figure 22: Trends in the age structure of the UK population, 2007-17
                                                              • A growth in 25-34s provides boost
                                                                • Declining 35-44s market expected to slow premium market
                                                                  • Rise in lower-spending over-65s
                                                                    • Slower growth predicted for ABs
                                                                      • Figure 23: Forecast growth of the UK population, by socio-economic group, 2007-17
                                                                    • Rate of marriages declines
                                                                      • Figure 24: Rate of marriages in England and Wales, by gender, 1960-2010
                                                                    • GDP, PDI and consumer expenditure and savings
                                                                      • Figure 25: GDP, PDI, consumer expenditure and savings, at constant 2012 prices, 2007-17
                                                                    • Strong Swiss Franc
                                                                      • Figure 26: Exchange rates for sterling against other currencies, 2007-12
                                                                  • Strengths and Weaknesses in the Market

                                                                    • Strengths
                                                                      • Weaknesses
                                                                      • Who’s Innovating?

                                                                        • Key points
                                                                          • Combining the latest technology with watches
                                                                            • Experimenting with new techniques
                                                                              • Fashion and fine jewellery
                                                                                • Brand collaborations
                                                                                  • Marketing initiatives
                                                                                    • Male inspired collections
                                                                                      • Online initiatives
                                                                                        • A trend for Britishness
                                                                                        • Competitive Context

                                                                                          • Key points
                                                                                            • Jewellery and watches grows slower than other sectors
                                                                                              • Figure 27: UK retail value sales of clothing and adornment products, at current prices, 2007-12
                                                                                            • Jewellery and watches account for 9% of the clothing and adornment sector
                                                                                              • Figure 28: UK retail value share of clothing and adornment products at current prices, 2012
                                                                                          • Market Size and Forecast

                                                                                            • Key points
                                                                                              • Market sees flat sales growth
                                                                                                • Figure 29: Value sales of watches and jewellery, at current and constant prices, 2007-17
                                                                                              • The future
                                                                                                • Watches and jewellery to grow by 5.3%
                                                                                                  • Figure 30: Best- and worst-case forecast value sales of watches and jewellery, 2007-17
                                                                                                • Factors used in the forecast
                                                                                                • Segment Performance

                                                                                                  • Key points
                                                                                                    • Figure 31: UK retail value sales of jewellery and watches, by sector, 2007-12
                                                                                                  • Precious metal jewellery
                                                                                                    • Watches
                                                                                                    • Retail Competitor Analysis

                                                                                                      • Key points
                                                                                                        • Figure 32: Jewellery retailers, by number of outlets, 2006-12
                                                                                                    • Retailer Profiles

                                                                                                      • Signet Group
                                                                                                          • Figure 33: Key financials for Signet Group UK, 2011 and 2012
                                                                                                        • Aurum Holdings
                                                                                                          • Links of London
                                                                                                              • Figure 34: Key financials – Links (London) Limited (Global), 2009 and 2010
                                                                                                            • Tiffany & Co
                                                                                                                • Figure 35: Key financials for Tiffany & Co Ltd, 2010 and 2011
                                                                                                              • Warren James
                                                                                                                  • Figure 36: Key financials for Warren James (Jewellers) Ltd, 2010 and 2011
                                                                                                              • Brand Promotion and Communication

                                                                                                                • Key points
                                                                                                                  • Adspend takes centre stage
                                                                                                                    • Figure 37: Expenditure on advertising, by top 20 jewellery and watch brands and retailers, 2009-11
                                                                                                                  • Renewed interest in TV and cinema ads
                                                                                                                    • Figure 38: Expenditure on advertising by jewellery and watch brands and retailers, by media type, 2009-11
                                                                                                                • The Consumer – Where Jewellery is Bought

                                                                                                                  • Key points
                                                                                                                      • Figure 39: Preferred outlets for buying jewellery, July 2012
                                                                                                                    • High street jewellery chains first choice
                                                                                                                        • Figure 40: High street jewellery chain and independent jeweller shoppers, by age and socio-economic group, July 2012
                                                                                                                      • Independent jewellers
                                                                                                                        • Young shop at Argos
                                                                                                                          • Figure 41: Consumers who have bought precious metal jewellery from Argos in the last five years, by gender, age and socio-economic group, July 2012
                                                                                                                        • Women twice as likely to buy from premium jewellers
                                                                                                                          • Over-65s less likely to buy jewellery
                                                                                                                            • Figure 42: Consumers who do not buy jewellery, by gender, age and socio-economic group, July 2012
                                                                                                                        • The Consumer – Attitudes Towards Buying Precious Metal Jewellery

                                                                                                                          • Key points
                                                                                                                              • Figure 43: Attitudes towards precious metal jewellery, July 2012
                                                                                                                              • Figure 44: Attitudes towards precious metal jewellery, by gender, July 2012
                                                                                                                            • A precious gift
                                                                                                                              • Women want unique designs
                                                                                                                                • Figure 45: Preference for buying jewellery which is unusual or a unique design, by gender, age and socio-economic group, July 2012
                                                                                                                              • Jewellery as an investment
                                                                                                                                • Awareness in hallmarking rises
                                                                                                                                  • Figure 46: Attitudes towards precious metal jewellery, by age and socio-economic group, July 2012
                                                                                                                                • Concerns about buying online
                                                                                                                                  • Ethical jewellery
                                                                                                                                    • Cost conscious
                                                                                                                                      • Scrapping gold
                                                                                                                                      • The Consumer – Most Desirable Watch Brands

                                                                                                                                        • Key points
                                                                                                                                            • Figure 47: Most desirable watch brands, July 2012
                                                                                                                                            • Figure 48: Most desirable watch brands, by age and affluence, July 2012
                                                                                                                                            • Figure 49: Most desirable watch brands, by gender, July 2012
                                                                                                                                          • Rolex is irresistible
                                                                                                                                            • Cartier desired by women
                                                                                                                                              • Omega appeals to older crowd
                                                                                                                                                • TAG Heuer holds affinity for men
                                                                                                                                                  • Breitling draws 35-44s
                                                                                                                                                    • Swatch appeals to under-35s
                                                                                                                                                      • Casio G-Shock popular among under-25s
                                                                                                                                                      • The Consumer – Attitudes Towards Watches

                                                                                                                                                        • Key points
                                                                                                                                                            • Figure 50: Attitudes towards watches, July 2012
                                                                                                                                                            • Figure 51: Attitudes towards watches, by gender, July 2012
                                                                                                                                                          • Replacement buying
                                                                                                                                                            • A watch is a timely gift
                                                                                                                                                              • Mobile phones threaten the market
                                                                                                                                                                • Figure 52: Agreement with statement ‘I prefer to use a device such as a mobile phone to tell the time’, by age group and socio-economic group, July 2012
                                                                                                                                                              • A watch for every occasion
                                                                                                                                                                • Consumers browse online, but buy in-store
                                                                                                                                                                  • A watch gives me status
                                                                                                                                                                    • Recycling watches
                                                                                                                                                                    • Appendix – Market Drivers

                                                                                                                                                                        • Figure 53: Ownership of watches, by demographics, 2011
                                                                                                                                                                        • Figure 54: Ownership of jewellery, by type of metal, by demographics, 2011
                                                                                                                                                                        • Figure 55: Ownership of gold or platinum jewellery, by demographics, 2011
                                                                                                                                                                        • Figure 56: Ownership of silver jewellery, by demographics, 2011
                                                                                                                                                                        • Figure 57: Attitudes towards accessories, by demographics, 2012
                                                                                                                                                                    • Appendix – Market Size and Forecast

                                                                                                                                                                        • Figure 58: Best- and worst-case forecast value sales of watches and jewellery, 2012-17
                                                                                                                                                                    • Appendix – The Consumer – Where Jewellery is Bought

                                                                                                                                                                        • Figure 59: Preferred outlets for buying jewellery, July 2012
                                                                                                                                                                    • Appendix – The Consumer – Attitudes Towards Buying Precious Metal Jewellery

                                                                                                                                                                        • Figure 60: Attitudes towards precious metal jewellery, July 2012
                                                                                                                                                                    • Appendix - The Consumer – Most Desirable Watch Brands

                                                                                                                                                                        • Figure 61: Most desirable watch brands, July 2012
                                                                                                                                                                        • Figure 62: Next most desirable watch brands, July 2012
                                                                                                                                                                    • Appendix – The Consumer – Attitudes Towards Watches

                                                                                                                                                                        • Figure 63: Most popular attitudes towards watches, July 2012
                                                                                                                                                                        • Figure 64: Next most popular attitudes towards watches, July 2012

                                                                                                                                                                    Companies Covered

                                                                                                                                                                    • Baume & Mercier
                                                                                                                                                                    • Citizen Watch UK Ltd
                                                                                                                                                                    • Ernest Jones Ltd
                                                                                                                                                                    • Gucci Group N.V.
                                                                                                                                                                    • Guess
                                                                                                                                                                    • H Samuel Ltd
                                                                                                                                                                    • Hot Diamonds
                                                                                                                                                                    • Longines
                                                                                                                                                                    • Marco Bicego
                                                                                                                                                                    • Omega Ltd
                                                                                                                                                                    • Rotary Watches Ltd
                                                                                                                                                                    • Signet Group
                                                                                                                                                                    • Swarovski
                                                                                                                                                                    • TAG Heuer International SA 
                                                                                                                                                                    • Vivienne Westwood Ltd

                                                                                                                                                                    The UK Watch and Jewellery Market - September 2012

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