A high-fashion range of South African-produced gold jewellery is to hit the United States market this month, amid hopes that demand will rapidly outstrip the initial 160kg order.
The venture is in line with the government’s call for more local beneficiation of precious metals, and should give an off-season fillip to South Africa’s gold jewellery industry.
The initiative is a cooperative arrangement between South African-based gold producer AngloGold Ashanti and jewellery company Gold®, which has headquarters in Cape Town and New York. Its CEO, US-born Sarah da Vanzo, splits her time between the two cities.
Gold jewellery has traditionally been designed and made at a leisurely pace — it takes a year to bring a new range from initial design to the shop window. As a result, this industry has lagged behind fashion trends, which are updated every six months on the catwalks of Milan, Paris, London and New York.
Frustrated by the fuddy-duddy designs, fashion houses such as Versace and magazines such as Harper’s Bazaar replaced gold jewellery with fake pieces created from glass, plastic and non-precious metals. Quicker and cheaper to produce, this jewellery was launched with clothing ranges.
In market research backed by Anglo-Gold, Da Vanzo investigated the tastes of women in North America, which currently buys 46% of the world’s new gold jewellery.
She discovered that their purchasing motives were complex. ”Forget about simple issues such as beauty and status. Think of the value of an unusual piece of jewellery as an ice-breaker at social occasions, or to signal moods.”
It also helps that the jewellery is made from gold. ”This is fashion with intrinsic value,” said Ilia McCormick, vice-president of merchandising for Gold®. ”At the end of the season, you have a cult item and the value of the metal.”
Based on the customer profiles that emerged from market research, Da Vanzo worked with fashion experts and magazine editors to create gold jewellery brands for AngloGold. After investigating the latest technology, the Gold® team found the development and production time of a new gold jewellery collection could be cut from a year to between three and six months — in time to coincide with the fashion seasons.
The marketing strategy was devised by Da Vanzo and her team including jewellery merchandiser McCormick, who launched Swatch and Guess watches in the US, pioneered the ”shop within a shop” concept and later tripled the sales of jewellery brands such as Tiffany and Cartier at Fortunoff stores.
The company settled on direct marketing as the way to get the jewellery to customers. ”This avoids the cost of direct competition with other aggressively marketed gold brands in jewellery stores,” said Da Vanzo. ”In the smaller South African market, Gold® jewellery will be sold in conventional stores under its own brand.”
The idea is to contract well-known designers to complement fashion trends. Italian Patrizia Lingua, chosen as guest designer for the autumn/ winter collection this year, played on a 1940s Hollywood glamour theme in drawing up a range of pieces. These were then translated into three dimensions, suitable for factory production, by Gold®’s technology and marketing director, David Muller.
Italy is the traditional gold jewellery production centre for the US market, but its industry closes down for union-regulated holidays in July and August — exactly when Gold® has to be at peak production for the upcoming season.
In South Africa, the industry closes in December and January. This, combined with the fact that most of the world’s gold is produced and refined in the country, prompted the decision to manufacture locally.
With no single manufacturer large or diverse enough to produce the complete order, Gold® convinced producers to co-operate in making the components and assembling the pieces. Cooperation of this kind was unprecedented, said Robert Hochfelden, production manager at M Obler & Son.
Muller said that by providing work but paying for all the materials and research and development, Gold® was building the local industry. ”Previously, buying the gold to fulfil an export order could cripple a local company.”