In Focus: Jewelry Market – Gold and diamonds in demand

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Jewelry is one of the fastest growing markets in Poland. Albeit still small, and largely fragmented, it appears to be quite attractive to global producers and designers. Local brands are also making an impact and are poised to take on international markets

by Anna Rzhevkina

Made in Poland” is not readily associated with jewelry and luxury in general. Not yet, at least. The value of the luxury jewelry and watch market in Poland is about 18 times smaller than in neighboring Germany and 20 times smaller than in France. However, it is developing the fastest of all luxury goods in Poland. By 2021 its value should reach about PLN 976 million, meaning a growth of almost 50 percent compared to 2017, KPMG analysts estimated.

“Necklaces and bracelets with diamonds suitable only for a special occasion are now less popular. More clients prefer jewelry with a single stone.”

With the growth of wealth, more and more Poles are interested in buying expensive jewelry with diamonds and other precious stones. Many clients see this as an investment of timeless value, said Piotr Rączyński, CEO of Apart, Poland’s biggest jewelry producer. In the company’s recent collection “Your Diamond Story by Apart” every diamond has a unique story confirmed by a certificate.

Image : Courtesy of FerrariFirenze

Emotional experience

Buying jewelry is not only about characteristics of gold and precious stones, it is an emotional experience. How a piece was created, whether the design is unique – the details matter a lot. Wealthy customers in Poland want to buy both products designed locally, and those from international boutiques, e.g. Milan or Paris, said Radosław Jakociuk, head of W.Kruk, the oldest jewelry maker in Poland, with a history dating back to 1840.

In recent years luxury in Poland has become more discrete, developing into part of everyday life. Necklaces and bracelets with diamonds suitable only for a special occasion are now less popular. More clients prefer jewelry with a single stone, a representative of another leading brand, Yes, told KPMG.

Home-grown success

W.Kruk, Apart and Yes have been market leaders in the Polish jewelry industry for years. In 2016 Yes opened a concept store on one of the most fashionable streets in Warsaw – ul. Mokotowska. In the store visitors can familiarize themselves with a history of the brand, drink a glass of champagne and discover new collections. Last year, Apart celebrated its 40th anniversary at the Wielki Theatre, inviting Polish stars, who wore jewelry from the brand. W.Kruk recently announced its plans to expand internationally through the acquisition of stores in the Czech Republic and Slovakia.

“The design of Italian jewelry, the materials used, different goldsmith traditions and higher prices compared to local producers make the penetration of the market slow.” 

Designed in Paris, made in Poland

As the demand for jewelry grows, new brands are eagerly entering the Polish market. Founded by local designers, they mostly offer semi-fine jewelry affordable to middle-income clients. A designer from Warsaw, Anka Krystyniak, makes jewelry that resembles amulets. She uses Polish symbols, such as mermaids and eagles, Indian motifs and she looks for inspirations in various religions.

Jewelry designer Ella Zubrowska

A brand from Łódź called Animalkingdom started out in 2011 with just two necklaces and two bracelets and quickly won the hearts of Polish women. Customers are offered the opportunity to create their own jewelry from the pieces in the shape of animals, birds and flowers.

 

Another Polish designer, Ella Zubrowska, creates collections inspired by antiquity and theater. “The collection is set in a fairy-tale world of small luxury sculptures which are entirely handmade in my workshop in Kraków,” the designer says. Zubrowska lives between Kraków and Paris but makes her jewelry in Poland. She said that her first clients were mostly Polish. When the brand was officially launched in Paris in May, more and more international orders came. “Made in Poland is actually very connected to made in the EU. There are many French fashion brands that are producing in Poland, such as Heimstone. Made in Poland is definitely not associated with cheap manufacturing. We have a lot of very good professionals,” Zubrowska said. She added that there are many Polish designers working for big international brands, and some of them may at some point choose to establish their own labels.

 

Not only silver and amber

The interest in original jewelry from Polish artists is rising. Social media helps young brands to gain popularity and a customer base. Seeking to stand out, jewelry producers actively experiment with the form, shape and materials. According to a specialized magazine, Polish Jeweler, for a long time, silver and amber were the most popular materials for jewelry in Poland. But recently, artists have started integrating gold into their collections, and their pieces have already drawn attention at international competitions.

Jewelry by Ella Zubrowska

At Dubai Design Week, young Polish designers surprised the international audience with physiotherapeutic jewelry. The MIKO+ brand offers gold-plated rings and bracelets with moveable elements. Their special shape massages the hand to relieve tension and pain. The bracelets are designed in a way to keep the wrist in the right position or to relax muscles while working at a computer.

Another exotic collection is Messh Perfumed Jewelry: hand-made pendants with scented balls inside them. Clients choose a design of a necklace, bracelet or earrings together with a fragrance. The perfume will last for about a month and can then be exchanged.

International brands in Poland

With the growth of overall wealth and demand for jewelry, Poland has become an attractive market for brands from other European countries, especially Italy. In June an event called Italian Jewelry in Warsaw brought together representatives of Bizzotto Gioielli, FerrariFirenze, Federici Gioielli and other local brands interested in partnership with Poland.

Poland is attractive because its jewelry market is at an expansion and development stage, a representative of FerrariFirenze Giulia Callegari said. However, for an Italian company there are various challenges. “The design of Italian jewelry, the materials used, different goldsmith traditions and higher prices compared to local producers make the penetration of the market slow,” Callegari said. Still, overall FerrariFirenze is optimistic as Polish women appreciate beauty and the handmade concept.

Even though an average Polish customer spends much less than an Italian or a French one, it hasn’t become an obstacle for the success of Austrian crystal jewelry producer Swarovski and Danish Pandora. Both have their mono-brand stores in all major Polish cities. In 2017 Swarovski also chose Gdańsk as the location for its global service center.

Luxury jewelry from abroad is present in Poland through multi-brand salons, such as Noble Place. The chain, with stores in Warsaw and Gdynia, offers its clients jewelry from Roberto Coin, Chopard and other iconic brands. Italian Pomellato rings with a “nude” stone in various color combinations, Montblanc watches, Boucheron wedding collection are all there for the most demanding clients.

Can jewelry be an investment?

In 2017 the price of gold rose due to numerous factors, including the weakened dollar. The demand also grew, once again reinforcing the conviction that gold is a good investment, according to Goldenmark, one of the largest distributors of gold and silver in Poland. However, investing in jewelry requires knowledge of certain criteria, e.g. the retail price of an item should be as close as possible to the market price of gold and diamonds. Therefore, buying jewelry in a store can be a pleasant shopping experience rather than an investment, as the client pays for retailer margins, marketing and advertising costs etc. For those who want to diversify their investment portfolio, Robert Śniegocki from Goldenmark suggests buying premium class diamonds (which account for only 2 percent of all extracted diamonds). In Poland sales have nearly doubled in recent years. Colored diamonds have drawn particular interest. “This means that Polish investors want to have something special and unique in their portfolio,” Śniegocki said.

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