- The jewelry category has been "quite behind in developing e-commerce," Gina Drosos, CEO of Signet Jewelers, said in an interview with Business Insider.
- Signet is in the midst of a multi-year turnaround plan, a large part of which includes improving its digital capabilities.
- Those plans have been accelerated due to the disruptions of the COVID-19 pandemic.
- Visit Business Insider's homepage for more stories.
When people are looking to make a big jewelry purchase — say, an engagement ring — often they'll take a trip to a store to see the options in person.
But as the COVID-19 pandemic continues to spread across the US, many would-be jewelry buyers might not be so comfortable going into stores.
Because of this, jewelry retailers like those operated by Signet Jewelers are pivoting.
"The jewelry category was quite behind in developing e-commerce," Gina Drosos, CEO of Signet, said to Business Insider. "Only about 15% of category sales were e-commerce."
With more than 3,000 stores, Signet is the largest specialty jewelry in the US, UK, and Canada. It operates Kay Jewelers, Zales, Jared, H.Samuel, Ernest Jones, Peoples, Piercing Pagoda, and JamesAllen.com.
Signet is in the midst of a multi-year turnaround plan that it calls the "Path to Brilliance." A major part of that plan is improving its omnichannel capabilities.
Those plans have been accelerated due to the pandemic.
"We pivoted very quickly when we needed to close our stores for the safety of our employees and customers back in March and began to do virtual selling, which is really something we've never done before," Drosos said. "I don't think we'll ever go back. Our customers have been delighted by our ability to now serve them wherever and whenever they want."
Drosos said that when Signet announced Path to Brilliance in 2018, the company's e-commerce sales only made up a "mid-single digit percent"of its business. This year, due in part to the disruptions of the pandemic, digital has grown to account for more than 30% of the company's sales.
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Signet said in its second quarter earnings release in September that its e-commerce business had grown 72.1% over the same period last year. Same-store sales were down 31.3% for the quarter, which was heavily impacted by store closures.
Drosos said the company wants to "crack the code on why it's taken the [jewelry] category so long to move into a virtual world."
She said the ability to consult with an expert on customizations and visualize the physical piece jewelry are two major factors that have kept the jewelry category from moving online in a big way like other areas of retail have.
"Think about the bridal journey, for example. Often that's the most expensive purchase that a couple has ever made up to that point," Drosos said. "Having an expert to guide you through it is really important, and now that we have all of these conversational tools and we have virtual consultants … I think we can provide that trusted relationship and expertise online in a way that just wasn't available broadly in the jewelry category before."
She added that Signet has introduced virtual try-on technology that allows customers to upload photos of their hand so they can see how a particular ring would look proportionally. Its camera technology can magnify photos of a diamond up to 40 times. Product listings also include a comparison of a ring's size with an iPhone, US quarter, or dollar bill.
Customers could additionally upload a photo of any piece of jewelry to the search function of Signets' brands' websites.
On the logistics side, Drosos said Signet has taken some of its existing distribution centers and dedicated them to e-commerce orders. It has also rolled out curbside pickup and buy-online-pickup-in-stores capabilities, which, as she noted, has been available at other types of retailers but "not really much in the jewelry category."
Shrinking the store base, but not ditching the mall completely
Another part of Signet's turnaround strategy has been to restructure its store portfolio. Drosos said about 19% of Signet's store base have closed since she came in as CEO in 2017. The company planned to close about 380 stores in 2020, including 150 that temporarily closed due to lockdowns in the spring and then did not reopen.
"In general, I would say we have been moving our portfolio more to off-mall locations," she said. "Those are often slightly larger stores and easier for customers to access."
The mall stores that are remaining in the fleet are typically those that are in better-performing malls.
In another blend of online and offline retail, Signet recently announced it would be opening 80 stores combining Jared and the digitally native James Allen brand.
"We tested that over the last year and it proved to be a strong traffic driver and a real delight for customers to have that integrated experience," Drosos said.
It is also planning to open 15 Piercing Pagoda kiosks in Class A malls before Christmas. That brand is more intrinsically tied to mall foot traffic.
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