Luxury jewellers are leading initiatives to address rising demand for sustainability in the jewellery industry. According to the Global Diamond Industry 2021–22 prepared by the Antwerp World Diamond Centre and Bain & Co, diamond jewellery retailers last year expanded their offerings to include several sustainability-led measures such as traceability programmes and collections of recycled gold and pre-owned jewellery.

LVMH-owned Tiffany & Co unveiled a jewellery line produced from recycled gold while diamond retailer Signet released a collection of reclaimed gold and repurposed diamonds. Kering meanwhile acquired a 5 per cent stake in Vestiaire Collective, an e-commerce platform for pre-owned luxury items.

In November 2021, Bain & Co reported that the second-hand luxury market survived and thrived throughout the Covid-19 crisis. The company expects the second-hand luxury market to have reached EUR33 billion (around US$37.5 billion) in 2021, driven by increased demand and a growing competitive arena. By comparison, the segment grew by 65 per cent between 2017 and 2021 as opposed to a 12 per cent growth in the first-hand luxury market during the same period.

A separate study by the Boston Consulting Group (BCG) meanwhile revealed that the global market for second-hand luxury goods such as jewellery and watches is growing at 8 per cent a year.

Sustainable appeal

Growth in the second-hand luxury market has been unprecedented. According to Andrew Brown, CEO of online jewellery sales platforms myGemma.com and WP Diamonds, this can be attributed to a combination of reduced prices on authenticated luxury resale, a focus on sustainability and consumers’ aspirational buying.

“The jewellery resale market presents the opportunity to not only buy current models of branded collections at a significant discount to retail prices, but it also enables consumers to find pieces that are no longer in production or are one of a kind,” explained Brown. “Our experts authenticate every piece, meaning that you are able to purchase the jewellery you want at the best price. We have jewellery ranging from US$200 to hundreds of thousands of dollars.”

Launched in 2012, WP Diamonds provides a transparent and secure way to sell luxury goods online, from engagement rings to luxury timepieces and handbags in as little as 24 hours. In 2018, myGemma.com was launched as the company’s e-commerce marketplace. To date, top-selling items there are designer bags, bracelets and luxury watches.

“We have been working online with consumers since 2012, buying personal luxury goods from them through our WPDiamonds.com franchise and we wanted to sell directly to consumers through our own platform – myGemma.com,” stated Brown.

Since its launch, myGemma.com has consistently performed above par. Pre-owned jewellery sales through the platform were up 75 per cent last year versus the prior year, mirroring growth in the overall luxury market in 2021.

Buyers’ growing appetite for second-hand luxury items, jewellery included, can also be traced to increased online activity especially during Covid-19 lockdowns as well as mounting preference for sustainable items. “We believe in the power of the circular economy and its environmental benefits: Shop pre-owned,” noted Brown.

Pandemic remedy

Nicola Whittaker, business development manager at UK-based Fellows Auctioneers, cited a “very strong 2021” for the second-hand luxury market, including the jewellery and watch business.

“New customers are bidding in our auctions every day and our jewellery and watch auctions continue to grow,” remarked Whittaker. “Since the start of the pandemic, customers have gotten used to bidding online rather than in person.”

Fellows provides high-resolution product pictures, condition reports and descriptions in lieu of in-person viewing by customers before buying – these helped encourage new bidders to participate in the company’s auctions. “Purchasing pre-owned luxury jewellery provides the perfect escapism for people. There is also a big level of excitement about auctions. You never know how much you can pick up an item for, which adds extra intrigue about auctions and their outcomes,” she noted.

With digitalisation becoming a larger part of modern business operations and customers’ purchasing journey, the auction market will likely continue being predominately online. “If customers have access to high-quality material so that they do not need to view it physically, then they can easily take part and bid from the comfort of their own homes,” remarked Whittaker.

Vickie Sek, chairman, Department of Jewellery at Christie’s Asia Pacific, agreed that the pandemic played a vital role in expediting many businesses’ digital transition.

At Christie’s, travel restrictions, lockdowns and events cancellations have sped up the development of its online sales platform, which now provides vast opportunities to present jewellery with higher frequency, wider variety and at broader price ranges. “This subsequently helps us drive a greater number of new and younger buyers who are eager to start collecting via auctions,” she stated.

BCG earlier said younger luxury consumers are the largest participants in the second-hand market, with 54 per cent of Generation Z and 48 per cent of millennial luxury customers buying pre-owned goods.

According to Sek, buyers look for the following when purchasing pre-owned luxury jewellery: The quality of the diamonds (colour, carat, cut and clarity) or gemstones and where they were mined; design, provenance, brand, condition and rarity.

Prospects and challenges

Whittaker said Covid-19 continues to pose challenges to the auction sector, but companies are adapting quickly to the new normal. All of Fellows' auctions are now online.

“This year, we would like to carry on with our upward trend, attracting new customers to our auctions and providing as efficient as possible a service to all. We received great feedback from our auctions, and we are constantly trying to push the boat out to ensure our customers have the best possible auction experience,” she revealed. Fellows also added more auctions to its 2022 calendar.

In 2021, the company held 75 specialist auctions, 64 of which were timed and 11 were live. It also conducted 21 pawnbroker auctions.

Sek likewise acknowledged that uncertainties brought about by business restrictions remain. Even when the market has learned to adapt to its new surroundings by bolstering its digital initiatives, in-person product viewing and bidding are still crucial to the auction business.

“We remain cautiously optimistic for the market, and we will continue to excel in curating sales for live and online auctions as well as private sales, and in upgrading digital capabilities,” she noted.

Brown, for his part, said the second-hand luxury market is poised for further growth over the coming years. The pre-owned luxury jewellery market, in particular, presents myriad opportunities for the consumer.

It allows consumers to: Clean out their jewellery boxes of items they no longer wear or perhaps have never worn; sell items they have inherited or been gifted that simply are not their style; or enable that aspirational purchase, perhaps a trade up of an engagement ring or a Cartier LOVE bracelet from an unbranded bracelet.

“The pre-owned market in many personal luxury goods enables consumers to find out-of-production pieces or limited editions that are not available in store. As such, resale is sometimes the only way to find certain pieces,” remarked Brown.