Jewelry companies that can predict and profit from changing industry trends will have an edge over the competition.

BY JORDAN CLARY

McKinsey & Company recently released a report on the jewelry industry in 2020. The report generally predicts a “glittering future” for the industry, with annual global sales expected to grow at 5 to 6 percent each year up to 2020. At the same time, the report cautions players in the business to stay abreast of new trends and developments. It predicts that the jewelry industry will follow a pattern similar to what the apparel industry has experienced in the past 30 years in the sense that many national brands have been outpaced by international brands such as H&M and Zara. This suggests more national and regional jewelers consolidating with international brands by 2020. In addition, branded jewelry (such as Cartier and Tiffany & Co.) is growing and expected to grow further, driven in part by “young consumers who turn to brands as a means of self-expression and self-realization.” A third such forecast is that non-jewelry brands like Dior and Louis Vuitton will comprise much of the industry’s future growth. Overall, the report believes the jewelry market in 2020 will be “highly dynamic, truly globalized and intensely competitive.” And perhaps most tellingly: “Consumer appetite for jewelry, which was dampened by the global recession, now appears more voracious than ever.”

—February 20, 2014