COVID Bridal Boom?
by Shane O’Neill, Vice President
It happened in a flash. COVID-19 hit the newswire, cases grew and, before we knew it, the country was on lockdown. People couldn’t leave the house, businesses were closed, and people had to decide who they were going to shelter in place with. When abrupt events like these happen, such as the 2008-2009 financial crisis, the knee-jerk reaction from small businesses is to cut ad spending. However, that approach can be premature and full of missed opportunities, if not thought through.
Fewer Advertisers, More Opportunity?
Our own client data showed an apparent drop in local jeweler ad spends from about March through July, while an actual increase in consumer search during that same timeframe in one key category; bridal. We saw in the reporting numbers a clear indication of less competition in ad spend in bridal related paid search. In fact, 66% of agencies experienced a decrease in overall revenue during COVID, while only 16% saw an increase, a direct result of lower ad spends. We also saw this during the 2008-2009 financial crisis. The retailers who pushed ahead with their marketing actually came out stronger in the end. With stores shut down, it only serves to increase the desire to cut ad spend. After all, the customer can’t visit the store, e-commerce notwithstanding. Throughout all paid search campaigns, bridal was the clear leader in improved metrics with Click-Through Rates improving by double digits and Cost Per Click falling by double digits, in some cases by 50%! Why? Fewer advertisers equal better positioning, which equals higher Click-Through Rates, which tends to deliver a lower Cost Per Click. The net result of a lower Cost Per Click means your budget gets more clicks and thus more web traffic from the bridal customer to “shop” your store…opportunities.
Why Did Bridal Campaigns Outperform?
Unlike other jewelry categories, the bridal consumer is in the market for 2-4 months. An engagement ring is likely their first important jewelry purchase, and they want to make sure they get it right. They do their research, educate themselves, and spend a large amount of time “shopping” for the perfect style. COVID-19 only increased this behavior as consumers were unable to go anywhere and also transitioned to working from home. Of course, this also explains why there was a 47 percent increase in broadband data usage during the height of COVID. A lot of retailers, whose quick reaction was to cut ad spend, missed this opportunity to potentially increase market share, and therefore sales, once the market opened back up.
Why Engagement Ring Sales are Soaring.
If you were in the bridal market before COVID, you most likely were or are still in the market as stores reopened. So, there certainly was, and is, pent up demand to actually be able to buy the ring. However, there are other factors that play a role in the engagement ring sales boom retailers are reporting.
- Many couples decided to shelter in place together during the lockdown while they may not have lived together otherwise. That experience may have contributed to the decision to make that a permanent situation and get married. Even for those who didn’t shelter in place together, it likely meant spending more time together and therefore pushing up the inevitable timeline.
- The stimulus checks. For many Americans, around 70% (3), who didn’t lose their jobs or see significant salary decreases, the stimulus checks meant more money in their pockets and while some saved, many spent. So, for some consumers, that check certainly helped the case of affordability. However, if you were already in the bridal market, that check might have been the impetus to pull the trigger. It also factored into buying a bigger ring, as some retailers are reporting higher average sales.
- High ticket luxury experiences like travel have fallen off a cliff, in particular, for older couples. This means more discretionary income is being spent elsewhere from home improvement to bridal.
- You stayed the course with your marketing. As outlined above, there were many opportunities for jewelers who maintained their ad spending. If you were a retainer that saw a decrease in average Cost Per Click by 25 – 50+ %, that means you received more clicks. More clicks mean more bridal market customers are visiting your website vs. your competition (that includes multinationals who may have cut budgets and typically advertise in your market).
Will the current trend continue? Well, that’s still to be determined. However, we are certainly in a “new normal”, which undoubtedly means less group social interaction and more one on one time. Maybe that’s not a bad thing. After all, it’s easier to find The One when the world is quieter and, for retail jewelers, that might spell opportunity.