Luxury Market Sluggish, Basel Shows

By Morgan Beard, Editor-in-Chief

Despite vendors' pre-show optimism, the 2002 Basel World Watch and Jewellery Show showed evidence of a slow market for luxury items.

The show, held April 4-11 at the Basel Exhibition grounds, saw overall attendance of 82,500 visitors, down about 5 percent from 2001. Exhibitors commented that the show felt emptier, blaming the soft global economy.

Notably absent for the second year in a row were U.S. and Asian buyers, leaving the brunt of sellers' expectations to fall on the European buyers. But there, too, the market was soft: Impending elections in Germany and France are making for an uncertain economic environment, and it's being felt throughout the continent.

In contrast, jewelry trends were clear. Pavé jewelry dominated the show, seen in everything from flowers and insects to more abstract shapes like gem-encrusted teardrops. Black diamonds, formerly seen only occasionally, dominated as an accent stone, serving to set off swatches of color.

In an effort to drive costs down, major jewelry brands were dipping into the world of "semiprecious" colored stones, particularly the fashionably-colored amethyst and peridot. Turquoise and coral were also popular, especially paired in eye-catching contrast.

"These colored stones, you see them everywhere now," one buyer was overheard commenting to her companions, reflecting the mood of jewelry designers. In addition to being less expensive than diamonds or even ruby, emerald, and sapphire, semiprecious gems allow for the brighter, multi-colored designs that are in favor right now.

Which is not to say that there was no demand for the classic "Big Three." Several major firms were moving back toward using more ruby, emerald, and sapphire as a way of creating classic, conservative designs. Those designs found favor with buyers who wanted a sure thing, jewelry that they could sell easily in uncertain times.

Reorganization Woes
The show saw some major organizational changes this year as exhibitors were arranged to create sections dedicated solely to watches, branded jewelry, designer jewelry, and related sectors.

While Hall 1 remained home to the watch brands, Hall 2 was given over to jewelry, with the most rarefied brands put, appropriately, on the top floor of the building. Where before there were 311 companies exhibiting there, in 2002 there were only 86, with a corresponding increase in booth space for each company. On the other floors were the "Hall of Feelings" and the "Hall of Fantasies," also home to a number of European jewelry brands, with the Hall of Fantasies dedicated to the most creative of jewelry designers.

Gemstones and pearls, meanwhile, were moved across the street to the "Hall of the Elements," sharing Hall 3 with the "Hall of the Universe," also known as the country pavilions. Halls 4 and 5 were dedicated to related industries, including packaging, tools, and non-branded watches.

Although the reorganization made it much easier for buyers to find the companies they were looking for, gemstone dealers grumbled about their exile from the high-traffic Hall 2. It raised serious questions about how buyers will act in 2003, when the country pavilions will move to an exhibition center in Zurich. Will buyers make the hour-long train ride to see those exhibitors? Conventional wisdom at the show was that they won't, and with the show management's renewed emphasis on branding, gemstone dealers were nervous that they would be the next to go in 2004.

But "wait and see" was the watchword for this year's Basel fair. Too much depends on what will happen in the next year, both in terms of the show and in the broader questions of politics and the economy. Above all, companies at the fair felt that a change for the better is just around the corner.

For an expanded review of this year's Basel fair, see the July/August 2002 issue of Colored Stone.