Valentine's Day isn't just a big holiday for Daniel's Jewelers -- it's the biggest. It sells more diamond jewelry on Feb. 13 and 14 than it does on Dec. 23 and 24. Chief executive officer David Sherwood tells Retail Insider how the fourth-largest independent jeweler in the U.S. is maximizing its appeal to both Gen Z and Hispanic shoppers, for Valentine's Day and beyond.
Retail Insider: Daniel's has stores now in California, Arizona, Texas, Nevada and New Mexico, and you're expanding into Florida. Can you give us a little background on the company?
David Sherwood: My grandfather started the business in East Los Angeles in 1954. We've grown to about 110 stores now, are opening three in Miami, and have annual sales of about $130 million.
When we started, East LA was full of migrants from the Midwest. Gradually, it became home to immigrants. These days, that store is in an area that's 95% Mexican-American. And many of our stores serve either a Mexican or Central American customer base.
To connect with that community, we've adapted our merchandise, the way we go to market, and our marketing. Most of our associates speak Spanish and come from those neighborhoods. Hispanics are the fastest-growing demographic. Fortunately for us, it's a group that loves jewelry.
Retail Insider: How does Daniel's get ready for the holiday?
Sherwood: Valentine's Day is challenging. People are recovering from Christmas, so they just ignore it and put it out of their heads. Then they walk through the drugstore enough times, with everything decorated with red hearts, and guys finally say, "Valentine's Day is a few days away!"
It's such a frenzy. The 13th and the 14th of February are similar to the 23rd and 24th of December -- it's all hands on deck. By 5 or 6 p.m., people are begging you: "Here's my credit card. Give me anything you can."
Then Feb. 15, all you hear is crickets.
Retail Insider: What's your marketing approach to the holiday?
Sherwood: We market late. With our ecommerce site, the fastest growing part of our business, we try to get out in front two to three weeks in advance. And we do a big out-of-home push. When they finally think about it, we want billboards to be in their faces. People ignore jewelry ads -- until they need jewelry.
Retail Insider: How is your marketing changing?
Sherwood: We just finished a rebranding initiative based on what we're learning about our Gen Z customers. The majority of our customers are now Gen Z and millennials,
Our old tagline was "Making diamond dreams come true since 1948." After learning more about younger Hispanics and how they see themselves, we changed it to "Own the dream." They're very entrepreneurial -- they're building their own lives. Many are part of the gig economy.
Retail Insider: What triggered the rebranding?
Sherwood: As we came out of the pandemic, we saw we had been stale for a few years. In 2020, 2021 and even into 2022, we were just keeping our head above water. It was so crazy: closures, furloughs, remote work.
At some point, we looked up and realized we hadn't focused on the core business: Where are we today, and how have people changed? We needed to evolve.
Retail Insider: Besides
billboards, where else do you advertise?
Sherwood: A lot of digital: Google, Facebook, Instagram and TikTok. We do very little TV, but a lot of radio. We work with ThirdEar, a great ad agency based in Austin. It's Hispanic-founded and hyper-focused on this market.
Retail Insider: What kinds of products do these younger shoppers like? Are they big on lab-grown diamonds?
Sherwood: Yes, we are the largest seller of lab-grown diamonds of any jeweler our size in the country.
There is such a value proposition -- you get a much bigger, brighter, more beautiful diamond for a fraction of the cost. What's important is the sentiment behind it ,and the beauty of it.
Retail Insider: What makes you different than your competitors?
Sherwood: From an online perspective, we compete with everyone. And in malls, we're always near a Zale's or a Helzberg Diamond store.
An important way we differentiate ourselves is with flexible credit programs. No matter someone's credit situation, we can get them approved. About 70% of our sales are financed. And we have a trade-in guarantee. We will buy back any item for every dollar you paid for it so that you can trade it in toward something even bigger and better.