A Step-by-Step Guide on How to Start a Jewelry Business: Niches, Market Stats, & More
June 29, 2020
There is a great amount of opportunity in selling jewelry online, but it can also be highly competitive. Major existing brands dominate with bigger ad budgets, a large social media following, and established brand recognition, which makes it hard for small, emerging jewelry businesses to keep up.
However, online global jewelry sales are expected to grow by 11% by 2021. The rise of direct-to-consumer (DTC) brands has led to new jewelry businesses popping up and winning market share over traditional brick-and-mortar jewelry stores.
While it may seem daunting to start your own jewelry business in a competitive market, if you follow the right steps to building a brand that offers something unique for online shoppers, you’ll be on your way towards great success.
In this post, we’ll discuss everything you need to know on how to start and grow your online jewelry business.
Finding your niche: 3 types of jewelry you can sell
A great example of a successful DTC jewelry brand is Ocean & Co., which sells high-quality, eco-friendly jewelry and donates a portion of sales to organizations dedicated to reducing ocean pollution. Their jewelry line aligns with a purpose that draws in a specific audience based on values.
There are several different ways to make your jewelry product stand out. You can sell jewelry for a specific audience and/or that’s designed for a specific purpose (weddings, prom, themed parties, etc.). When it comes to starting a jewelry line, there are endless possibilities. Here are the most common types of jewelry brands.
1. Costume jewelry
Costume jewelry, also known as fashion jewelry, is meant for everyday use. Unlike fine jewelry, costume jewelry uses lower cost and imitation materials like synthetic diamonds, wood, plastic, brass, copper, and other metals.
A single piece of costume jewelry should be priced affordably, anywhere between $1 to $100. A great example is BaubleBar, one of the biggest online brands for affordable jewelry. They first launched the brand by focusing on affordable jewelry pieces. Once they established a reputation, they expanded their product line by offering higher-end ‘luxury’ pieces.
If you’re thinking of selling costume jewelry, make sure you create a product pricing strategy that’s affordable, or you’ll miss out on a lot of potential customers.
2. Fine jewelry
Fine jewelry is made out of precious metals and gemstones like gold, silver, platinum, diamonds, and rubies, and is oftentimes associated with a luxury lifestyle. These types of jewelry products are stylish, high quality, and are usually worn for special occasions.
For instance, Brilliant Earth is a fine jewelry brand that offers vintage-inspired engagement and wedding rings. Unlike going to a jewelry store and picking out a ring as is, Brilliant Earth offers an innovative online shopping experience by allowing shoppers to fully customize their ring (e.g., the type of metal, gemstone, shape, etc.).
Fine jewelry products can range from $100 to $3,000 per item (sometimes even more), depending on the type of materials used, size, sourcing, and brand reputation.
3. Handmade jewelry
The popularity of online marketplaces like Etsy has shown that customers are willing to purchase handmade jewelry and other handmade products. While handmade jewelry can’t be mass-produced, it’s a viable option for business owners who want to make and sell unique jewelry or custom pieces.
Although marketplaces like Etsy offer a great opportunity for jewelry artists to sell their custom work and build a following, it can be highly competitive unless you’re willing to play the role of the jewelry designer and the marketer to attract Etsy shoppers to your store. It’s also hard to scale if you are making each piece yourself, or if the jewelry is made-to-order.
A snapshot of the jewelry market in 3 stats
Although highly competitive, there is a great opportunity in building a jewelry brand. Here are some statistics that illustrate the current state of the online jewelry market.
1. Jewelry industry market size
The jewelry industry is expected to reach $480 billion by 2025. China, the United States, and countries throughout Europe are all great markets for jewelry. However, newer industrialized countries are expected to make up a larger portion of jewelry sales as their per capita income continues to rise.
2. Specialty jewelers continue to rise
Specialty jewelers generate more than 43% of the industry’s total US-based sales. Finding a unique space in the jewelry marketplace will help you stand out from the competition.
3. Fine jewelry still has a presence in traditional retail
Fashion jewelry will continue to sell better than fine jewelry in ecommerce by 10%. When purchasing online, shoppers are more willing to buy jewelry at an affordable price, rather than pay $1,000 for a piece of jewelry since it’s hard to make a big purchase online without trying it on first.
How to start a jewelry business in 10 steps
If you’re looking to start selling jewelry online, you’ve come to the right place. Below we outline the 10 steps to take before launching a jewelry business.
1. Pick your niche and target market
Before you make your jewelry business idea a reality, make sure there’s a viable target market first, preferably one that isn’t over-saturated. When customers start their search online for jewelry, they often have an idea in mind of what they’re looking for already, so always consider the type of customer you want to attract and make sure you understand what they’re looking for.
Understanding your ideal customer can help improve your return on ad spend (ROAS) with better targeting to ultimately help you spend less and attract more sales.
2. Study the competition
Once you know the type of jewelry you want to sell and the audience you want to attract, it’s time to look into the competition. Research their pricing, offers, social media channels and social commerce strategy, reviews, and press coverage, to find out how you can gain a competitive advantage. You’ll want to take note on what competitors are doing so you can and look for ways to further differentiate your product.
Let’s say your competitor sells costume jewelry for teens, but their negative reviews mention how quickly the items break. With that information, you may decide on promoting how your costume jewelry product lasts longer or offer an extended returns policy.
Another potential competitive advantage to look for is delivery speeds as shipping can build customer loyalty. Most online shoppers want their products delivered within two days. If you’re looking to offer 2-day shipping and compete with jewelry brands that sell on Amazon, you might want to consider partnering with a third-party logistics (3PL) provider like ShipBob.
3. Develop a business plan
Whether you are self-financed or get financing from a bank, family, ecommerce venture capital, or a fund, you’ll need a detailed business plan. With a business plan in place, you can calculate the number of products you need to manufacture and your path to profitability. A business plan also makes you look more legitimate to financiers and makes a great first impression in convincing them to invest.
4. Choose a creative name (with an available domain)
Take the time to come up with a creative name that aligns with your brand’s mission and purpose. Your business’s name is important as it needs to be unique enough so customers remember it and not too abstract that people don’t understand what type of product you sell.
You also want to check out the US Trademark Office to make sure your business entity can be trademarked or isn’t currently trademarked. Even if the name is available, you’ll want to check website domain availability, which you can do on website domain and hosting sites like GoDaddy.com.
5. Design a product line
If you’re getting into jewelry because it’s your passion, this is the easy part. There are so many great places to find inspiration, like your favorite jewelry designers, latest trends, and more. Once you have your products designed, you need to figure out how to handle production and acquiring supplies in bulk.
6. Choose to outsource manufacturing and suppliers or not
Once you have design concepts for your jewelry line, you’ll want to research potential manufacturers and decide whether or not you want to produce products locally or overseas. If you’re hand-making your designs, you’ll need to purchase jewelry-making tools and equipment.
It can be beneficial to also ask other jewelry designers about trustworthy wholesale distributors or look into getting a reseller license so you can forgo paying local sales taxes when you buy in bulk.
7. Devise a unique brand aesthetic
Designing a brand identity will make your custom packaging and marketing materials stand out — which all plays into creating a remarkable unboxing experience. Find a great custom packaging company to partner with, like noissue or Packlane, to help make your packaging stand out.
Don’t forget about your website! It’s also worth hiring a graphic designer to help create a logo and other branding materials for a consistent brand look and feel.
8. Develop a marketing strategy
Finding potential customers to get your first sale is a challenge for any new jewelry business. Target your marketing towards the demographics most likely to purchase. As you focus on building a customer base, use the research you compiled, including insight on competition, to develop a multi-channel marketing strategy.
You should incorporate as many channels as possible including:
Customers love to research products and reviews before making their decisions. On social media posts, you can highlight what makes your brand different. For example, if you’re focused on sustainability, then post about how your products are good for the environment and add related tags to your posts. Can your jewelry be worn during exercise? Post images and videos of people working out while wearing your jewelry.
Contrary to popular belief, email marketing isn’t dead. Growing an email list is one of the best ways to keep your brand on top of mind and improve customer retention. But beware — sending too many emails to customers can exhaust your list and lead to a high rate of unsubscribes, so be sure to follow email marketing best practices.
Although it’s still in its infancy, SMS ecommerce marketing is a rapidly growing channel for online businesses. With open rates as high as 95%, you can essentially guarantee that everyone on your SMS subscriber list will see your messages and promotions.
Paid advertising (Google, Facebook, and Instagram)
Many of the largest DTC ecommerce businesses today grew from ad campaigns on channels like Facebook, Instagram, and Google Ads. Ad costs continue to rise, but they can still be a viable channel for jewelers. If you want to run ads, spend time optimizing your audience targeting so your ads are served to people who are most likely to buy. And choose your channels wisely — what channels perform best for other brands might not work best for you.
Search engine optimization (SEO)
Free traffic is the best traffic. With so many online businesses relying on social media ads to make sales, ad costs are continuing to rise. With a good SEO strategy, your product listings, blog posts, videos, guides, and other types of owned content can show up at the top of search results and get more traffic without increasing your ad spend.
To give an example of why SEO is valuable, Ocean and Co ranks as the first result for “sea turtle bracelet” as seen above. This is a search term that averages around 700 searches a month and conveys user intent, which helps attract more traffic to a specific product for free.
When looking for the right keywords to attract organic traffic, use tools like Google AdWords or Moz to find keywords that have a high search volume with low competition.
9. Build your own online store with an ecommerce platform
Building an ecommerce website is easier than ever due to the numerous ecommerce platforms, apps, and integrations available. Ecommerce platforms are designed to make setting up an online store as seamless as possible. Some of the most popular ecommerce platforms include Shopify, BigCommerce, WooCommerce, Squarespace, and Wix.
An alternative to building your own website is to create a store on Etsy, but it’s more suited for handmade jewelry and made-to-order items. And since it’s a marketplace, it’s harder to get exposure and traffic to your Etsy store. Plus, Etsy gets the ‘credit’ for the sale as people won’t necessarily remember your brand, just that they bought on Etsy.
10. Find a fulfillment solution
As you start out, you’ll probably need to store inventory in your home and self-fulfill orders. This might work at first, but as your grow your business, you’ll eventually need to rethink your fulfillment strategy. Once you reach a point when it’s hard to keep up with packing and shipping orders on time, you’ll want to consider outsourcing fulfillment to a 3PL, so you can focus more of your time and energy on other parts of your business.
Fulfill orders without lifting a finger with ShipBob
There are many reasons to work with an order fulfillment partner like ShipBob for your jewelry business. With industry-leading expertise in fulfillment and logistics, we’ve helped some of the fastest-growing DTC jewelry brands scale their growth by taking care of ecommerce shipping for them.
As your jewelry business grows, hiring the right people with logistics and warehousing expertise is a time-consuming process. Finding warehouse space is expensive and can take a while for you to get up and running. With ShipBob, you get access to our entire fulfillment center network, our technology, and our operations infrastructure.
Amazon made two-day shipping the norm and many small businesses don’t have the resources to support two-day shipping, which can lead to a high cart abandonment rate. With ShipBob, jewelry brands can offer affordable two-day shipping to help compete with shipping options like Amazon Premium Shipping.
“We looked into opening our own ecommerce warehouses and hiring employees, but couldn’t come close with what 3PLs charge for picking, packing, and shipping. We’d also be worried about scheduling fulfillment shifts, ordering boxes and shipping labels, and dealing with the extra headaches of running logistics. Our order volume has seen ebbs and flows, and ShipBob has fulfilled over 10,000 shipments per month for us, with Black Friday/Cyber Monday and our summer season being our most in demand times of the year.”
Gerard Ecker, Founder & CEO of Ocean & Co.
Inventory and order management technology
“We roll out new products and designs on our website 1-3 times a month and send new inventory to ShipBob each week. It’s really easy to create new SKUs and restock existing ones using ShipBob’s technology, which is especially important with high inventory turnover.”
Carl Protsch, Co-Founder of FLEO
Data and analytics
ShipBob’s free analytics tool gives you the data needed to run a successful jewelry businesses online by offering full visibility into the entire fulfillment process. Get real-time data on fulfillment performance, transit times, shipping costs, inventory forecasting, and much more.
“At my previous 3PL, everything was done on spreadsheets and it was very difficult to get the fulfillment data I needed. Now, we’re working with a tech-enabled 3PL that seamlessly provides data to help us make business decisions. ShipBob’s analytics tool is a game-changer and it’s helped me grow my business tremendously.”
Courtney Lee, founder of Prymal
Starting a jewelry business is an exciting endeavor, and it’s never been easier to start a successful business online, but that doesn’t mean it comes with challenges. As you grow your jewelry business, you might find it hard to keep up with fulfilling a high volume of orders. If you’ve reached this point of growth, it might be time to outsource ecommerce fulfillment.
To learn how ShipBob can help make the process of working with a 3PL easy, click below for a quote.