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April Jewelry Sales Inch Up 1.3% YoY

May 12, 2024 /

Total jewelry sales rose as consumers opted for higher-priced items in April. Despite a 1.2% decline in units sold, sales rose 1.3% year-over-year. The increase in revenue was fully driven by a 2.5% increase in the average consumer expenditure per unit purchased.

Finished Jewelry Sales Increased in April

Finished jewelry sales rose 4% year over year although unit sales declined in April. The average retail prices increased 6% to $1,096 per item.

The two jewelry categories that led to the rise were necklaces and bracelets, which experienced a rise in units sold in addition to the increase in revenue.

Among necklaces, the fashion sub-category is in increasing demand, leading to a double digit increase in revenue and average spending per item. The popular chain necklace sub-category is experiencing a modest decline in units sold, against a 7% increase in revenue and price.

Natural Diamond Jewelry Sales

After a difficult March, natural diamond jewelry sales rose 1% in April. Necklaces led the diamond jewelry category, with unit sales up 7% year over year. Revenue by diamond necklaces soared 22%.

Year to date, sales are still down, but despite the minor fluctuations, natural diamond jewelry sales are relatively stable, especially in comparison to lab-grown diamond jewelry.

Diamond Engagement Ring Prices Soaring

The heart of diamond jewelry demand is exhibiting two contrasting trends. One, a loss of market share to lab-grown engagement rings. The other is soaring expenditure on natural DERs.

In April, finished engagement rings set with natural diamonds, averaged $3,736. This is in line with the average price In April 2023. The one issue hurting this category most is the decline in couples purchasing them. Unit sales are down 7% year to date.

Lab-Grown Diamond Jewelry

Since mid-2021, the rise in retailers’ revenue from finished jewelry set with lab-grown diamonds has been shrinking. From triple digit rises in 2021, revenue is currently up 29% year to date.

The slimming trend in loose lab-grown diamonds led to a decline in revenue. It’s reasonable to expect a similar future for finished jewelry. This is especially glaring when looking at combined sales – those of finished jewelry, semi-mounts, and loose gems.

In April, total lab-grown diamond related sales rose just 10% year to date versus a 28% rise in 2023.

These ongoing trends reflect a decline in prices and possibly an erosion in consumer perception that lab-grown diamonds represent a luxury product.

Lab Grown-Set Engagement Ring Prices Falling

The lab-grown jewelry category that has performed best so far was engagement rings, much to the concern of the natural diamond industry. However, although it continues capturing market share – 45% of units sold in April – revenue is declining.

In the past year, the average price of finished lab-grown set diamond engagement rings fell 5% to just $3,027. When considering finished engagement rings and semi-mounts and loose lab-grown diamonds, the price drop in 20%. The decline resulted in a 1% decline in year-to-date sales.

Natural & Lab Grown-Set Diamond Engagement Ring Unit Sales

Natural & LG Set Engagement Ring Unit Sales Jan 2020-Apr 2024 April Jewelry Sales - Source-Tenoris.bi

Diamond Sales Remain Sluggish

The decline in consumer spending on diamonds continued in April. The decline was caused by lower average expenditure per unit, as American consumers reduce discretionary spending on a variety of items.

Natural Diamond Sales Rise

For the third time in a row, natural diamond sales rose month over month despite a decline in unit sales. The 7% increase in revenue was spurred by an 8.3% increase in average spending per item to $10,232.

However, year over year, the average expenditure was down 5%, leading to a 9.5% decline in sales.

The average retail price of one carat rounds sank 20% year over year, which in many ways tells the story of natural diamonds so far this year.

What further details the story of the diamond market is market share. By units sold, natural diamonds are continuing to lose market share to lab grown, now down to just 43%. However, by value naturals still reign, holding 75% of the market.

This is a remarkably stable market share, holding steady since January 2023 despite market fluctuations and the difference in price trends.

Loose Natural & Lab-Grown Diamonds Share of Units Sold

Lab-grown and Natural diamond market share by units sold chart - Jan 2020-Apr 2024 - April jewelry sales source Tenoris.bi

Loose Natural & Lab-Grown Diamonds Value Share of Sales

Lab-grown and Natural diamond market share by value chart - Jan 2020-Apr 2024 - April Jewelry sales source Tenoris.bi

Another sign of slowing sales is how long natural diamonds are held in stock before being sold. In this respect, we are back to the bad old days. In the first four months of this year, it was 24 months. This compared with 22 months in the January-April period of 2023 and just 18 months in 2022.

As always, when sales slow down, goods begin to pile up.

Lab-Grown Diamond Revenue Declines Keep Growing

The trend of decreasing revenue from loose lab-grown diamond sales is continuing. In April, sales fell 5.7% year over year, marking the fifth consecutive month of sales declines.

The average expenditure per item is presently at its lowest level, averaging $2,618, falling 23% in the last year. The deep decline in average price outpaced the rise in number of units sold, up 23%.

Loose Lab-Grown Diamond Sales Revenue YoY Is Shrinking

US retail loose lab grown diamond sales YoY chart - Jan 2022-Apr 2024 - Source Tenoris

The decline in sales is not purely related to price declines. Part of it has to do with the overall slowdown in sales. Yet, this is a warning sign.

Aware of the decline in revenue, retailers keep trying to preserve their position by moving slow on price declines. This is easy to see when considering the change in cost of goods sold. In April, COGS was down 43% compared to the 23% decline in the average price.

This is an ongoing trend, resulting in higher gross margins. As the decline in gross revenue indicates, this is slowing the tide, not stopping it. Although the gross profit from loose lab-grown diamond sales increased 11% year over year, this is far from the 222% rise in the first four months of 2021.

If this declining trend continues, loose lab-grown diamond could become a losing proposition for retailers in just two-three years.  

YoY Change in Gross Profit from Loose Lab-Grown Diamond Sales

US retail gross profit YoY from loose lab grown diamond sales Jan-Apr 2021-2024 - Source Tenoris

About Tenoris

Tenoris collects retail sales data from a broad representative sample of US jewelry retailers. Tenoris subscribers include retailers, manufacturers, miners, and financial firms. They use this data to study everything from broad market trends to price prediction, assisting them in identifying changing trends and opportunities ahead of their competitors.

Tenoris can help improve your business through a better understanding of the US jewelry market. Contact us to discover how our reports provide comprehensive insights of the US jewelry market and how you can gain access to this data.

Photo: Nick Karvounis

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