Jeweller - May 2021

News
News
Diamond organisation warned over advertising
The National Advertising Division (NAD) – the US
advertising industry’s self-regulation body – has
issued a warning to the Natural Diamond Council
(NDC) following a complaint from lab-created
diamond company Diamond Foundry.
In March, the NDC made its own complaint to the
NAD, challenging descriptions and nomenclature
used in digital marketing for Diamond Foundry and
its subsidiary, jewellery brand Vrai.
LVMH watch and jewellery division records 138 per
cent increase in revenue following Tiffany deal
The warning pertained to advertising that
compared natural mined diamonds with manmade
diamonds – also known as lab-grown, labcreated,
or synthetic diamonds – appearing on
the NDC’s website and in marketing assets made
available to retailers.
Diamond Foundry disputed the NDC’s claim that
natural diamond production generates ‘three
times less carbon emissions’ than lab-created
diamonds – a figure the NDC derived from a report
commissioned and published by its predecessor,
the Diamond Producers Association, in 2019.
In an April 22 statement, the NAD determined that
the NDC’s evidence for the ‘three times less carbon
emissions’ claim was “not sufficiently reliable”
and was “concerned that such claims conveyed
a broader implied message about the overall
environmental benefits of mined diamonds versus
man-made diamonds”.
NAD recommended NDC remove the claim,
alongside online advertising that referred to the
“scarcity of mined diamonds [and] the resale value
of mined diamonds versus man-made diamonds”.
“NAD recommended NDC remove the claim,
alongside online advertising that referred
to the ‘scarcity of mined diamonds [and] the
resale value of mined diamonds versus
man-made diamonds’”
NAD determined that “Diamond Foundry must,
consistent with the Federal Trade Commission (FTC)
Jewelry Guides, make an effective disclosure that its
diamonds are man-made. NAD further found that,
consistent with the FTC Jewelry Guides and the
FTC Dot Com Disclosure publication, the advertiser
should distinguish its LGDs from mined diamonds”.
Formerly known as the Advertising Self-Regulatory
Council (ASRC), NAD is an independent non-profit
that monitors truth and accuracy in advertising.
While not an official regulator, it often refers cases
to the US Government’s Federal Trade Commission.
Frequently, its cases are established based on
challenges from competing businesses.
Tiffany & Co. has contributed to a 138 per cent increase in revenue for LVMH’s Watch & Jewelry division. Pictured:
New Tiffany & Co. celebrity spokesperson Anya Taylor-Joy. Image credit: Nolan Zangas/Tiffany & Co.
In its first financial update for 2021, French
luxury conglomerate Moët Hennessy Louis
Vuitton (LVMH) has reported revenue of €13.96
billion ($AU21.6 billion), an increase of 32 per
cent compared with the same period last year.
During the first quarter of 2021, €1.88 billion
($AU2.9 billion) came from LVMH’s Watches
& Jewelry division – up 138 per cent compared
with 2020.
US publication JCK Online reports Guiony as
saying, “Integrating Tiffany is very important to
us... [The company is] a big acquisition for us
[and] our number one priority.”
Guiony added, “It will take years to do what we
want to do with this brand, from a distribution,
merchandising, and marketing viewpoint. It is a
lot of work – we are committed to doing it.”
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Michael Hill International reports positive
sales trends, continues COVID recovery
Despite the COVID-19 pandemic, Michael Hill
International has recorded increased revenue and
same-store sales for the quarter ended 28 March 2021.
In its latest quarterly financial report for the
trading period ended 28 March 2021, Michael Hill
International (MHI), has recorded encouraging
results, including a 16.4 per cent increase in samestore
sales and revenue of $118.5 million, up 11.6
per cent compared with the same period last year.
Australia – MHI’s largest market – was a key
driver of revenue, recording sales of $70.3 million,
an increase of nearly 20 per cent. Canada, MHI’s
second-largest market by store count, recorded
revenue of $CAD17 million.
The results were significantly hampered by
temporary store closures due to the COVID-19
pandemic, with 134 of its 288-strong store network
forced to shut their doors.
Daniel Bracken, CEO MHI, said, “I’m delighted by
these results... Considering the ongoing challenges
of navigating COVID-19, particularly in Canada,
this result demonstrates the resilience of the
Michael Hill business and further validates our
transformation to a modern, differentiated, omnichannel
jewellery brand.
“I’ve never been more confident in our leadership
team, and with a clear plan for growth, we are
well-placed for continued strong results despite the
uncertain environment,” he added.
Online sales also continued to climb for the
jewellery chain, with e-commerce accounting for 5.6
per cent of total sales – an increase of 69.2 per cent
from the previous quarter and more than 90 per
cent higher than the same period in 2020.
The increase is largely attributed to the
acquisition of international jewellery company
Tiffany & Co., which was finalised in January.
Tiffany & Co.’s annual revenue – which totalled
$US4.4 billion ($AU6.8 billion) in 2019, the last
financial year for which figures are available
– is approximately equal to that of LVMH’s
existing Watches & Jewelry division, which
includes TAG Heuer, Bulgari, Hublot, Zenith,
Chaumet, and Fred.
A statement published on the LVMH website
noted, “The Watches & Jewelry business
group recorded organic revenue growth of 35
per cent in the first quarter of 2021 compared
to the same period of 2020 and 1 per cent
compared to that of 2019. The quarter marked
the integration for the first time of the iconic
jewelry Maison, Tiffany & Co, which saw an
excellent start to the year.”
The company also noted that while the US and
Asian markets have improved significantly,
Europe remains hampered by temporary store
closures and travel restrictions as a result of
the COVID-19 pandemic.
While LVMH management described Tiffany
& Co.’s Q1 2021 performance as “excellent”,
its chief financial officer Jean-Jacques Guiony
recently told investors that the company has
“tremendous” potential to expand.
“It will take years to do what we want
to do with this brand [Tiffany & Co.],
from a distribution, merchandising,
and marketing viewpoint. It is a lot of
work – we are committed to doing it”
JEAN-JACQUES GUIONY,
Möet Hennessy Louis Vuitton (LVMH)
Alexandre Arnault, the 28-year-old son of
LVMH chairman Bernard Arnault and former
CEO of luggage brand Rimowa, was named
Tiffany’s executive vice-president of product
and communications in January..
Barely two months into Arnault’s tenure,
Tiffany & Co. cancelled its New York Times
print-edition ad, which had run on the third
page since 1896. Fashion publication Women’s
Wear Daily reports that Arnault has used
Instagram Stories to ask followers for input
into the future of Tiffany & Co., posting, “What
would you like to see us do at Tiffany?”
The company has also begun utilising a new
group of celebrity spokespeople, including
entertainer Jackson Yee, Roseanne ‘Rosé’
Park, of South Korean girl group Blackpink,
The Queen’s Gambit actress Anya Taylor-Joy
and male model Alton Mason.
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