For High Jewelry, a Multifaceted Future?

For more than 120 years, the world’s leading jewelers have courted the 0.01 percent with dazzling creations from luxury boutiques lining Paris’s Place Vendôme, largely unchanged for generations in terms of tenants and construction. Until now.

The high jewelry business — one-of-a-kind pieces priced from $50,000 to several million dollars and often handcrafted in Vendôme ateliers to showcase precious stones and advanced artisanal techniques — has been turned on its head by a generational shift in its traditional clientele.

Houses have been scrambling to appeal to the 21st century consumer: younger, digitally savvy shoppers, predominantly from Asia and the Middle East, most of whom have very different demands and expectations from their predecessors about what, where and why they acquire some of the most expensive luxury products that money can buy.

That is not easy, given that collections can be years in the planning, hunting for the right gems and then executing the painstaking production. But pivoting is proving critical for many larger houses, given that haute joaillerie exists as a kind of counterweight to their heavy dependence on entry level sales.

“Exposure to the high jewelry market remains key because it gives brands credibility to sell ‘bread and butter’ products in the price range of $2,000 to $10,000, which is the jewelry market sweet spot,” said Luca Solca, a luxury analyst at Bernstein.

“Ultimately, a presence on the Place Vendôme gives you a ‘credibility anchor’ to then sell a greater range of products to the broader public.”

Recently, there have been a lot of changes to the elegant facades of the 19th-century hôtels particular around the square: expensive face-lifts, like the multiyear, multimillion-euro refurbishment of the Boucheron flagship, unveiled in January, and a clutch of new arrivals, ranging from Chinese houses like Feng J to the Kering-owned brands Queelin and Gucci, both of which opened stores in July.

And houses known for classic (read: old-fashioned) stone-centric creations have started bold experiments that rethink the code of the modern heirloom, be it with unexpected materials or streetwear-infused designs such as sleek ear cuffs and knuckle duster rings.

An injection of young talent also has boosted a fresh, edgier perspective — and many of these creative directors happen to be women.

“When I started out in this business the high jewelry market was so traditional and boring,” said Gaia Repossi, 33, the fourth generation to lead the Italian family house. “There was no sexiness or novelty and buying was very occasion- or investment-led. It needed a youthful and fresh perspective.”

After becoming the brand’s creative director in 2007, at 21, Ms. Repossi transformed its aesthetic, focusing on simple, delicate and design-led styles that attract a specific kind of clientele to her small yet chic store on the Place Vendôme’s south side. (And LVMH Moët Hennessy Louis Vuitton bought a minority stake in 2015.)

“Multiple piercings are now the norm,” she said. “So is self-gifting by independently wealthy women who want to make purchases they will wear every day, and mothers who want to follow the tastes of their daughters, not the other way around.”

Ms. Repossi would not disclose the company’s financials, but said sales have increased by a total of 30 percent over the past four years.

Valérie Messika, another industry scion (her father was a famous diamond dealer), agrees. She became known in the late 2000s for her rebellious, rock 'n’ roll designs like stackable rings, chokers and studded ear cuffs.

“The age of the haute joaillerie business being driven by grand families collecting treasures to hand down to the next generation is largely dead,” she said. “Today, it is about focusing on a new confident fashion-conscious generation, looking for a unique expression of individuality.”

This new wave of superrich clients may have inherited their mothers’ discerning eye for diamonds and gemstones, but they wouldn’t be seen dead in a tennis bracelet (although more conventional, stylistically “safe” offerings — like the Van Cleef & Arpels Alhambra collection or Cartier Love pieces — continue to do well in other price categories).

Also, designers say, that while many wouldn’t want a piece that had been on the red carpet or worn by an influencer, they are still highly attuned to and influenced by social media platforms like Instagram — so many ateliers are increasingly focusing on designs that photograph well and are clearly visible on small mobile devices.

Feng Ji, one of China’s new generation of homegrown luxury jewelers who has an appointment-only showroom on the Place Vendôme, said that a significant majority of her sales are made via WeChat or Instagram (a trend echoed by many brands).

Thirty percent of her pieces are bespoke and made in collaboration with the clients, many of whom, she said, want pieces that reflect their personality or sense of style. Eighty percent of her clients are Chinese socialites, aged 30 to 35, who were educated overseas and have returned to China, but travel regularly.

“In China, the wealthiest millennial clients have been given more conventional jewelry from the big-name houses as a teenager or in their early 20s. They learn a lot at a very young age,” Ms. Feng said. “Now, there is a small but growing group who want something distinctive and different from a local designer.” Some want pieces that mirror their contemporary art tastes. Others commission pieces worth hundreds of thousands of euros, with precious stones in eye-catching colors to complement their latest sneaker or handbag purchases. “If you have everything, you want things no one else can have,” she said.

According to Manuel Arnaut, editor in chief of Vogue Arabia, exclusivity is so important in the Middle East that many brands now offer special designs and lines just for the region (catering to local tastes by, for example, creating stackable items featuring colorful stones and full diamond pavé). And buyers frequently are purchasing for others: Brides often receive a full set of gem-laden jewelry as a gift from wedding guests.

“In terms of the way people buy, social interaction is super important and people will buy specific brands and products just because their peers are buying it,” Mr. Arnaud said. “While in Europe buying a brand that no one knows is seen as cool, here people like to invest in famous brands. If an iconic design comes in an extremely expensive and unique limited edition, all the better.”

The increasing importance of individualism, in all its myriad forms, is clear to industry figures like the Boucheron chief executive, Hélène Poulit-Duquesne. It is what prompted the house to begin offering exceptional experiences to top clients, like a special penthouse guest suite in the Place Vendôme flagship — operated by the Ritz, which is just across the way — and featuring views of the Eiffel Tower from the bathtub.

Or to offer cutting-edge creations like its Eternal Flowers rings of preserved flower petals, which debuted last year, featuring titanium pistils and encrusted with precious colored stones like sapphires, spinels, garnets or pavé-set with diamonds. Each ring costs about $380,000.

“High jewelry doesn’t need to be ‘old school’ and we need to make sure of that, which is why we create these sorts of offerings,” Ms. Poulit-Duquesne said. “I think in life if you don’t take risky decisions or break the rules at some point, you cannot achieve something big. Those who want to succeed in high jewelry cannot afford to stand still anymore.”

Affordability — and whether deviations from classic creative and commercial approaches are profitable for brands — remains the million-dollar question (often literally).

Although price volatility in core materials like gold and diamonds can hamper bottom lines, margins for recognizable high jewelry houses like those on the Place Vendôme remain some of the juiciest in the entire luxury industry.

Their target audience, while tiny, continues to be well-heeled: According to the Global Wealth Report published last year by the bank Credit Suisse, less than 1 percent of the world’s adult population held almost half of all global wealth in 2018. And branded jewelry was among the top growth luxury categories last year, up 7 percent, according to a report by the global consulting company Bain & Company.

Little wonder there has been a flurry of new entrants to the space, like Giorgio Armani’s first high jewelry collection presented last month and Gucci’s debut in July, as well as fashion marques like Chanel and Dior continuing to expand their top-end ranges. There has also been an uptick in mergers and acquisitions activity, ranging from Richemont’s purchase of the Italian fine jewelry house Buccellati in September to LVMH’s $16.7 billion takeover of Tiffany & Co. agreed late last month, the largest ever deal for the luxury sector.

“High jewelry and haute couture both command the question as to where luxury product ends and art begins,” said Rebecca Robins, global chief learning and culture officer at the consultancy Interbrand. “From the exponential success of the Dior exhibition to Cartier opening up its archive for its largest exhibition in New York, the cultural capital of high jewelry is on the move and very important to customers.”

“Fashion houses are pivoting into an area where they are looking to unique products and experiences that exceed the expectations of their high net worth and ultra high net worth customers,’’ she continued. “Investing in or adding high jewelry to their armory plays hard to that ambition.”

In an increasingly uneasy world rocked by social inequality and political unrest, a several-millenniums-old advantage of serious jewelry still rings true: pieces offer a tangible and portable way to take — and to show off — wealth wherever their owners please. Even if contemporary aesthetic preferences are rapidly evolving, that mind set has not changed.

“With the number of ultra rich consumers rising, together with their extraordinary fortunes, high jewelry remains an attractive market in its own right,” Mr. Solca said of Bernstein said. “There is definitely a very high end coterie only willing to buy exceptional products and they don’t care about price. That isn’t going to change any time soon.”

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