Pandora’s CEO has offered a frank assessment of the global jewellery trade and detailed the ‘secrets to success’ for the world’s largest jewellery brand.
Pandora recently reported strong fourth-quarter sales, with a notable rise in revenue from the company’s largest market (US) bucking broader industry trends.
In an interview with Forbes, CEO Alexander Lacik said many brands have learned valuable lessons despite adverse trading conditions.
“It’s the highest level of promotions we’ve seen in my six years at Pandora, and we have seen a negative sentiment in the industry over the past couple of years,” he said.
“What emerged at the end of last year and also continuing into this year is that more brands are struggling and moving to heavier discounting to get the sales volume they need.”
He added: “There’s not a lot of volume out there, and when you go for the volume, you pay for the volume.”
The report details the four key pillars of Pandora’s Phoenix Strategy, an initiative announced in the first quarter of 2021.
These include transitioning into a ‘complete’ jewellery brand, an emphasis on design to broaden assortment, expanding market penetration, and personalisation through retail execution and digitalisation.
While Pandora reported that charm and bracelet sales still account for 74 per cent of total sales, revenue from other jewellery products has increased by 22 per cent.
“In any market condition, there will be winners and losers, and it’s usually the brands that continue investing in their identity and customer relationships that emerge stronger,” Lacik explained.
“This is the essence of our Phoenix Strategy, and six consecutive quarters of double-digit growth in a challenging market show that it is working.”
New store designs, named Evoke 2.0, have been central to the transition into a complete jewellery brand. The report estimates that around 60 per cent of Pandora’s stores will feature this design by 2026.
With that said, a focus on digital sales remains critical, with between 700 and 900 million consumers visiting the brand’s website each year. Lacik noted that around 2 per cent of these visits result in sales. While many brands focus on incremental improvement, Pandora has other ambitions and is testing new initiatives in Canada and Italy.
“We must think another way. What about the 98 per cent who are walking away? How can we get more of those 98 per cent engaged with us and keep them from leaving?” he asked.
“That’s what we are looking at, and the first step is what we’ve done in Canada and Italy. It is actually quite promising.”
Outgoing Pandora general manager for Australia and New Zealand, Travis Liddle, recently spoke with Jeweller about the brand’s plans in the local market, which included an increased focus on partnerships with independent retailers.
More reading
The Next Chapter: Pandora revamps retail strategy in Australia
Pandora Australia general manager resigns
Year of the Snake: Pandora unveils new collection
Looking ahead: Pandora optimistic about sales forecast
Be Love: New releases for Pandora’s holiday campaign
Pandora denies any changes to engagement jewellery strategy
Pandora releases lab-created diamond jewellery in new markets
Pandora: Lab-created diamond jewellery boosts sales
Significant sales spike for Pandora
Credit: jewellermagazine.com
