Close

Not a member yet? Register now and get started.

lock and key

Sign in to your account.

Account Login

Forgot your password?

Pandora Jewelry Idea Proposal (PNDORA)

Pandora Jewelry Idea Proposal (PNDORA)
 

Is Shine the answer to keep Pandora Jewelry’s bubble from bursting?

Report Available: April 25, 2018

 

Blueshift’s initial research found Pandora struggling in its mature markets. Pandora hit a few bumps in the road in 2017 as the mall environment struggled, customer demographics are changing, and the brand is feeling pressure in the U.S. and Europe. But it is looking to gain control of its network through acquiring franchise-owned stores. It is also launching a new product line to attract new customers and keep existing ones, while emphasizing and growing its non-charm offerings to become a full-service jewelry company.

 

Observations

  1. Pandora’s Q4 revenue grew 15% compared to a year ago. Revenue from company-owned concept stores climbed 51% and now makes up 40% of revenue. However, revenue in the U.S., Pandora’s largest market, only grew about 2% in local currency. Some of Pandora’s struggles in the U.S. comes from selling its products through non-branded stores, something the company is looking to overcome as it focuses on company-owned stores rather than shop-in-shop and licensed retailer environments. To that effect, Pandora added 376 company stores in 2017, including the acquisition of 200 franchise-owned concept stores, in an effort to better control its network. Pandora is opening 200 concept stores in 2018 and expects revenue growth of 7% to 10% for the year.
  2. Part of Pandora’s success has been built on having the same products throughout different countries without having to tailor its offerings based on geography. Yet sales in Pandora’s most established markets, like the U.S., have suffered from the lack of new concepts and too much repetition in its collections. Pandora has emphasized earrings and rings in an attempt to become a more full-service jewelry company. In 2017, revenue from these categories grew 28% and now makes up 26% of company revenue.
  3. A new product introduction Pandora is hoping will inspire new sales is the Shine collection, the company’s 18K gold-plated sterling silver jewelry. The pieces are considerably less expensive (~$50 for a charm) than Pandora’s 14k gold charms (~$350) and about even with its silver charms. The line launched in March, backed by elaborate in-store campaigns and brand ambassadors like singer Ciara and model Hailey Baldwin.
  4. In anticipation of its growth, Pandora is working with supply chain planning software company Quintiq as it looks to double its 2015 production capacity by the end of 2019. The partnership will allow Pandora to be more agile, account for seasonal demand changes, reduce production lead time, and get new products to market faster and more efficiently.
  5. Blueshift’s Oct. 27, 2016, report said the popularity of Pandora jewelry remained on the upswing internationally, and only very faint signs of buyer fatigue are occurring in the U.S. Six of the 10 sources representing U.S. stores that sell Pandora jewelry said sales were up in 2016 and should continue growing. Four of the five store sources in Germany and the United Kingdom also reported growth for the brand. Any weakness in sales did not appear to be linked to copycats or other competitors. Pandora kept its designs fresh, and its collectible charms remained an attractive concept. Pandora’s long-term future hinged on decreasing its reliance on sales of charms and bracelets, but the company did not seem to be making much headway. Store sources said items like rings and earrings continued to account for only a small slice of Pandora sales.

 

What trends were observed with Valentine’s Day? What are the overall trends with Pandora this year? Which direction is the trend going? How is the release of the Shine products trending? How are customers responding to the new line? How is production and supply? How are franchise owners responding to buy-back efforts? To answer these and other questions, Blueshift will gather data and issue a market research report from independent sources in the following areas: Pandora franchise owners, Pandora stores in the U.S., International Pandora stores, and Industry specialists.

  

Companies: Pandora A/S (CPH:PNDORA), Signet Jewelers (SIG), Tiffany and Co. (TIF)

 

Research Begins: April 9, 2018

 

Are you aware Intro-act, our corporate access solution, is part of the Blueshift Research ecosystem? To learn more, go toIntro-act.comor check out our video suite.