Signet Jewelers Limited is shaking up its retail model, adding Rocksbox, a direct-to-consumer rental subscription company, to its collection of brands.
Signet, the parent company of such mall stalwarts as Zale’s, Kay and Jared, says the purchase is part of its ongoing transformation plan, a three-year effort to put some sparkle back in the troubled bling business.
Rocksbox, based in San Francisco and launched back in 2012, was an early entrant in the D2C circular economy trend, letting members rent costume jewelry. For $21 a month, users can try up to three new pieces each month, with free shipping each way. And if they fall in love with something, there are options to buy.
In its announcement of the deal, Signet says the agreement gives it better access to “self-purchasing women customers, a segment where Signet is currently under-developed.” In addition to generating revenue, Signet hopes Rocksbox can help improve its connected-commerce performance.
Terms weren’t disclosed.
The announcement comes when jewelry retailers -- like all mall-based stores -- are confronting multiple challenges. COVID-19, of course, is a big one. While jewelry sales have been recovering, the NPD Group estimates jewelry sales declined 30% between March and October of last year.
Retailers are facing an onslaught of changing consumer preferences, including fewer marriages, increasing concerns about sustainability and conflict minerals, and the rise of lab-grown diamonds.
Signet, based in Akron, Ohio, is already looking to build on many of these trends. It’s been expanding service offerings, including piercing (it also owns Piercing Pagoda), warranties and repairs.
And it’s trying to keep up with the Gen Z and millennial demand for all things personalized, where it competes with the likes of Etsy, which has seen sales of jewelry rise 50% in recent months. Signet’s Jared now sells customized jewelry with an offering called The Jared Foundry. In select stores, these shops-within-shops can either alter existing pieces or build bespoke items from scratch.
Other circular-economy companies offer jewelry, including Rent the Runway. Jewelry, especially watches, is an integral part of The RealReal’s strategy. And for those looking for high-impact sparklers, there’s Beekman New York. It calls itself a borrowing service, and once a customer provides proof of homeowners insurance, it is happy to rent out power pieces. A pair of Tiffany moonstone, sapphire and diamond drop earrings, for example, cost $400 a day, while a Bulgari diamond necklace, weighing in at 19 carats, went for $950.
Last month, Signet released fourth-quarter financial results, with sales eking out a 1.5% gain over the prior-year period, rising to $2.2 billion. Same-store sales climbed 7%, and ecommerce results jumped 70%. Net income for the quarter rose to $245.7 million from $178.8 million in the comparable period.