Raphael Stevens

Media and most telecommunications companies still don’t have a strong growth narrative for 2024.
Interest rate and regulatory concerns may curb transformative deals until 2025.
Next year could be make-or-break for legacy media as it either proves its sustainability or its vulnerability.

The Grinch
Source: Universal Studios 

It’s human nature for a new year to bring optimism and hope.
For executives, investors and employees in the entertainment and telecommunications industries, 2024 is set to disappoint.

Maybe that’s too grinchy. Some things will get better. The actors’ and writers’ strikes are over. The 2024 U.S. presidential election should help boost advertising dollars as global TV ad revenue is on pace to decline 18% this year, according to media investment firm GroupM.
Companies such as Warner Bros. Discovery and Disney cut thousands of jobs and dramatically slashed content costs to boost free cash flow and pay down debt. That could give investors a reason to be more sanguine about their business prospects next year. Disney recently restored its dividend for early 2024 after suspending it for more than three years.
Still, legacy media companies including Disney, Paramount Global, Warner Bros. Discovery and Comcast’s NBCUniversal are trying to figure out what investors want since pulling back on a narrative of subscription streaming video growth that dominated 2020 and 2021. Warner Bros. Discovery and Comcast have outperformed the S&P 500 in 2023, though just barely. Disney and Paramount Global have underperformed.

The overriding narrative for 2024 appears to be one of uncertainty on three key fronts: interest rates, regulatory policy and overall growth prospects. The industry should have more clarity in 2025 on all three topics to propel it forward, said Corey Martin, managing partner at entertainment law firm Granderson Des Rochers. Next year will probably be defined by preparation for action rather than actual transformation, Martin said.
“2024 is probably going to be a year of sustained uncertainty,” said Martin. “It’s really a continuation of a pattern we’ve seen since the midpoint of 2022.”

The Jerome Powell factor

U.S. Federal Reserve Chair Jerome Powell attends a press conference in Washington, D.C., the United States, on Dec. 13, 2023.
Liu Jie | Xinhua News Agency | Getty Images

After the benchmark 10-year Treasury yield hit a 16-year high in October, rates have come down as the Federal Reserve said it’s planning for multiple cuts to come in 2024 and beyond. The Fed’s overnight borrowing rate is at between 5.25% and 5.5% — significantly elevated from where rates had been since the financial crisis of 2008.
Rate cuts next year could push transformational deal-making to 2025. If media or technology companies want to acquire large assets and don’t have the cash on hand, they’ll want to wait for cheaper money.
“I had lunch in late November with the CEO of a major studio, and what he expressed is uncertainty around operating in this monetary policy environment,” said Martin. “What is the cost of capital? Am I better served punting until 2025 where I have more clarity when interest rates come down or remain static?” 
Still, major deals could be announced in 2024 with an assumption that the process of closing them will take 12 to 18 months. By that time, companies may bet on interest rates falling to levels more in line with the past 10 years.

Shari Redstone, chair of Paramount Global, attends the Allen & Co. Media and Technology Conference in Sun Valley, Idaho, on Tuesday, July 11, 2023.
David A. Grogan | CNBC

Shari Redstone has held talks for the last few months to potentially sell National Amusements, the controlling holding company of Paramount Global, according to people familiar with the matter who declined to be identified because the discussions are private. If that deal occurs in 2024, it could kick off a wave of strategic transactions, including selling dying cable networks to private equity firms, throughout the media and entertainment industry regardless of the macroeconomic environment.
National Amusements declined to comment.

Biden, Trump and regulatory frustration

Three CEOs of major media and telecommunications companies privately told CNBC they are hoping for new regulatory policy — perhaps in the form of a presidential administration change — to make needed consolidation easier. Existing rules that cap regional broadcast station ownership prevent or deter companies such as Sinclair, Tegna, Nexstar and Gray Television from merging.
There’s additional concern Federal Trade Commission Chair Lina Khan or any other regulatory leaders appointed by President Joe Biden in 2024 and beyond won’t look kindly on the combination of cable and wireless assets. While companies in Europe own both, cable ownership is still separate from wireless network operators in the U.S. Bringing companies such as Comcast and Charter together with either AT&T, Verizon or T-Mobile could increase corporate pricing power and eliminate competition, which Khan would likely see as anti-competitive.
There’s also the ongoing dance between NBCUniversal, Warner Bros. Discovery and Paramount Global. Many media watchers assume that two of those three companies could merge, leaving the third without a dance partner. How regulators would view a combination of those assets is still to be determined. A deal between NBCUniversal and Paramount Global, which would put together broadcast networks CBS and NBC under one corporate roof, seems like a regulatory nonstarter without divesting one of the networks.
“There will be a final round of consolidation in the industry,” said John Harrison, EY Americas media and entertainment leader. “Structurally, it’s not sound in terms of the economics for streaming. Companies need to get their cost structures right as linear TV winds down. But there’s a hesitancy to pull the trigger on anything massive when you know how fast the disruption is taking place, and you’re looking at an 18- to 24-month-long review process to get a deal approved.”

Brian Roberts, chief executive officer of Comcast, arrives for the annual Allen & Company Sun Valley Conference, July 9, 2019 in Sun Valley, Idaho.
Drew Angerer | Getty Images

If the two presidential nominees are Biden and former President Donald Trump, relief may not be coming. Trump’s Department of Justice blocked AT&T’s acquisition of Time Warner before a judge overturned the decision. Trump has also been publicly antagonistic toward NBC and parent company Comcast, calling CEO Brian Roberts a “slimeball” as recently as last month in a post on the ex-president’s social media platform Truth Social.
Ironically, that could make some companies less bothered by regulatory issues. If executives feel both Republican and Democratic administrations may be obstacles, corporate boards could decide to approve moving forward with transformational deals sooner rather than later. If a deal is blocked, they can try their luck in court.

Where’s the growth?

Since the “Great Netflix Correction” of 2022, there isn’t a unifying growth narrative for media and entertainment companies. Cable operator stocks continue to move up and down on home broadband additions or subtractions — a concerning trend with growth stalling in 2023. AT&T and Verizon shares have been stuck in neutral for more than a decade, even as they’ve gained fixed wireless customers this year and likely will add more next year.
Traditional TV subscribers again dropped by the millions this year. As eyeballs diminish, advertising dollars will also decline. Next year will also likely be another year of industry losses for most major streaming services. Disney, Paramount Global and NBCUniversal have all pegged 2025 as their flagship streaming services’ first full year of profitability.

President and C.E.O. of Warner Bros. Discovery David Zaslav speaks during the New York Times annual DealBook summit on November 29, 2023 in New York City.
Michael M. Santiago | Getty Images

Media executives have spent 2023 right-sizing their businesses and pulling back on content spending to accelerate profitability paths for their flagship streaming services. Warner Bros. Discovery Chief Executive David Zaslav had his pay package altered so that his bonus is tied to his company’s free cash flow generation and debt payback. Disney announced last month its cost savings for the year will be $7.5 billion — $2 billion more than its previous target of $5.5 billion.
But the industry remains stuck at depressed valuations relative to two or three years ago. Disney is preparing for a proxy battle with activist investor Nelson Peltz and former CFO Jay Rasulo, who plan to campaign for board seats based on Disney’s poor performance relative to the S&P 500.
“The [Disney] board and CEO [Bob Iger] appear to have no conviction that things will get better,” Peltz’s Trian Fund Management said in a statement Thursday.
Beyond financial metrics, several executives privately acknowledged morale has become an increasing concern at legacy media companies. When uncertainty is so high, with few clear growth prospects to generate excitement and layoffs rampant, it’s hard to generate cultures of prosperity and retain top talent. One executive noted he’s increasingly hearing from peers that running media and entertainment companies just isn’t as fun as it was five or 10 years ago.
2024 should be an inflection year for the industry. Either conditions will improve or they won’t. If they don’t, expect fireworks in 2025.
Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.
WATCH: It’s very hard to see any strategic buyers for Paramount, says LightShed’s Rich Greenfield More

State of Freight

There could be more trade disruptions to come as Iran-backed Houthi militants strike ships in the Red Sea.
Several major shipping lines have suspended their services through the Red Sea as more than a dozen vessels have been attacked since the start of the Israel-Hamas war.
The U.S. and other countries have banded together in an effort to protect the vessels.

A container ship sails through the new section of the Suez Canal in the Egyptian port city of Ismailia, 135 kms northeast of the capital Cairo on October 10, 2019.
Khaled Desouki | AFP | Getty Images

Attacks by Iran-backed Houthi militants on ships in the Red Sea have already rocked global trade. And there could be more disruptions and price increases to come for shipments of goods and fuel.
Several major shipping lines and oil transporters have suspended their services through the Red Sea as more than a dozen vessels have come under attack since the start of the Israel-Hamas war in early October.

Help appears to be on the way. U.S. Defense Secretary Lloyd Austin, who is visiting Bahrain, said American forces along with the United Kingdom, Bahrain, Canada, France, Italy, Netherlands, Norway, Seychelles and Spain would create a new force to protect ships in the region.
MSC, Maersk, Hapag Lloyd, CMA CGM, Yang Ming Marine Transport and Evergreen have all said they will be diverting all scheduled journeys immediately to secure the safety of their seafarers and vessels. Collectively, these ocean carriers represent around 60% of global trade.
Evergreen also said it would temporarily stop accepting any Israel-bound cargo, suspending its shipping service to Israel. Orient Overseas Container Line (OOCL), which is a part of Chinese-owned COSCO Shipping Group, has also stopped accepting Israeli cargo, citing operational issues.
“About 30% of Israeli imports come through the Red Sea on container vessels that are booked two to three months in advance for consumer or other products, meaning that if the voyage will now be extended, products with a shelf life of two to three months will not be worthwhile importing from the Far East,” said Yoni Essakov, who sits on the executive committee of the Israeli Chamber of Shipping.
“Importers will need to increase stock due to the uncertainty and pay much more and others will lose out on their markets as time to market is not competitive,” Essakov added.

On Monday, oil giant BP said it would also pause shipping activity in the Red Sea as the Yemen-based Houthis continue their attacks.

Cargo ships are seen at Israel’s Haifa commercial shipping port in the Mediterranean Sea on December 13, 2023.
Mati Milstein | Nurphoto | Getty Images

“The safety and security of our people and those working on our behalf is BP’s priority. In light of the deteriorating security situation for shipping in the Red Sea, BP has decided to temporarily pause all transits through the Red Sea,” the company said in a statement to CNBC. “We will keep this precautionary pause under ongoing review, subject to circumstances as they evolve in the region.”  
Oil tanker group Frontline also said it is avoiding the Red Sea.
The attacks have already pushed ocean freight costs higher. Since the beginning of the Israel-Hamas war, the Asia-U.S. East Coast prices climbed 5% to $2,497 per 40-foot container, according to the Freightos. It could get even more expensive as major companies avoid the Suez Canal, which feeds into the Red Sea, and opt instead to go around Africa to get to the Indian Ocean.
Doing so adds up to 14 days to a shipping route, incurring higher fuel costs. And since ships take a longer time to get to their destinations, the workaround results in a perceived “vessel capacity crunch.” Delays in container and commodity deliveries are inevitable.
Container shipping represents nearly a third of all global shipping, with the estimated value of goods transported amounting to $1 trillion, according to Michael Aldwell, executive vice president of sea logistics at Kuehne+Nagel.
“Approximately 19,000 ships navigate through the Suez Canal annually,” Aldwell said. “The extended time spent on the water is anticipated to absorb 20% of the global fleet capacity, leading to potential delays in the availability of shipping resources. 
There will also be delays in returning empty containers to Asia, which will only add to supply chain woes, he added.
Moody’s highlighted the delays in a note to clients.

A mock drone is displayed at a square on December 07, 2023 in Sana’a, Yemen.
Mohammed Hamoud | Getty Images

“This situation, if it extends beyond a few days, will have credit positive implications for both the container shipping industry and for tanker and dry bulk markets,” wrote Daniel Harlid, senior credit officer at Moody’s. “But it also raises the risk of further disruption to supply chains.”
Insurers are also shifting their stance, which could result in higher costs passed on to shippers and consumers. The Joint War Committee (JWC), which includes syndicate members from the Lloyd’s Market Association and representatives from the London insurance company market, said it is widening its high-risk zone to 18 degrees north from 15 degrees north.
“The Red Sea Listed Area has been extended by 3 degrees north to factor in missile range from Yemen, reflecting a dynamic and evolving situation where ship owners have already shown their awareness of developments with some significant re-routing announced,” Neil Roberts, head of marine and aviation at Lloyd’s Market Association, said in an email.
The Red Sea and the Gulf of Aden, to the south of Yemen, are already listed by the JWC, as both areas have required notification of voyages since 2009. The decision to expand the high-risk area influences underwriters’ considerations over insurance premiums. 
The route shifts will also likely hurt Egypt’s already-struggling economy, which has already suffered a hit to tourism due to the Israel-Hamas war. Egypt owns, operates and maintains the Suez Canal. The Suez Canal Authority said it had generated a record $9.4 billion during the 2022-23 fiscal year.
–CNBC’s Rebecca Picciotto contributed to this report. More

Shares of VF Corp. tumbled after the company said it suffered a cybersecurity breach.
The attack is expected to have a material effect on its business.
It’s a major hit as the company, which owns The North Face and Vans, gears up for the holiday rush.

A Vans store is seen in Hong Kong.
Budrul Chukrut | LightRocket | Getty Images

Shares of The North Face and Vans owner VF Corp. tumbled Monday after the company reported that a hack had affected its ability to fulfill some orders ahead of the holidays.
The company said hackers encrypted “some” systems and made off with personal data. Those are some hallmarks of ransomware, where attackers try to extort companies in exchange for hefty payment. VF Corp. declined to comment on whether the incident was a ransomware attack.

The stock closed down more than 7% Monday.
VF Corp. announced the incident on the same day that the U.S. Securities and Exchange Commission’s new cyber disclosure rules took effect. Those regulations mandate that companies report “material cybersecurity incidents” to their investors within four days of determining that a hack would have an effect on their bottom lines. VF Corp. first identified hackers in its system on Dec. 13, meaning it took relatively little time for the company to identify the threat as material.
The attack is expected to hit the company’s operations in the lead up to the critical holiday shopping period. The company said the breach has affected its ability to fulfill orders, but customers will still be able to place them online.
The full scope of the attack is still not known, and it will likely continue to have a material impact until recovery efforts are complete, the company said.
The new SEC rules are designed to give investors a clearer picture of how attacks can harm businesses. When casino firm Caesars Entertainment was breached earlier this year, for example, the company quietly paid a $15 million ransom, sources previously told CNBC. Only after MGM Resorts was hit by the same attacker did Caesars disclose that it had been affected.

Under the new disclosure obligations, Caesars likely would have had to report the hack and the payment much earlier. Regulators and law enforcement strongly discourage companies from paying ransoms. But given the debilitating effects that cyber disruptions can have, many companies do so anyway. 
VF Corp. is the latest major company to be hit a by cyberattack that disrupted company operations. In addition to Caesars and MGM, Clorox was hit by a breach that prevented the company from keeping its items on store shelves earlier this year. More

Nikola founder Trevor Milton was sentenced to four years in prison for defrauding investors of the electric- and hydrogen-powered truck maker.
Milton was found guilty in October 2022 on two counts of wire fraud and one count of securities fraud.
Milton became an overnight billionaire when he took Nikola public through a deal with a special purpose acquisition company in June 2020.

Nikola founder Trevor Milton was sentenced Monday to four years in prison in connection to defrauding investors of the embattled electric- and hydrogen-powered truck maker.
Milton also was fined $1 million and could later be forced to forfeit property as part of his sentence.

The punishment was far lower than the 11 years prosecutors had requested at Milton’s sentencing in U.S. District Court in Manhattan.
But it was substantially more than the non-jail sentence of probation sought by Milton’s attorneys.
“I did not intend to harm anyone and I did not commit those crimes levied against me,” Milton told Judge Edgar Ramos before being sentenced, Reuters reported.
Milton has shown little to no remorse for his actions, prosecutors said. In a letter to Ramos on Sunday, prosecutors wrote that the judge should take into account Milton’s “profound denial of accountability and insistence on blaming others.”
The judge allowed Milton to remain free on bail while he appeals his conviction, according to Reuters.

Trevor Milton, founder of Nikola Corp., exits court in New York, US, on Monday, Dec. 18, 2023.
Yuki Iwamura | Bloomberg | Getty Images

Milton was convicted in October 2022 on two counts of wire fraud and one count of securities fraud. He had faced a recommended sentence of 60 years in prison under federal sentencing guidelines for those crimes.
Restitution will be determined at a future proceeding, according to the U.S. Attorney’s Office for the Southern District of New York
“Trevor Milton lied to investors again and again — on social media, on television, on podcasts, and in print. But today’s sentence should be a warning to start-up founders and corporate executives everywhere — ‘fake it till you make it’ is not an excuse for fraud, and if you mislead your investors, you will pay a stiff price,” Damian Williams, U.S. attorney for the Southern District of New York, said in a statement.
Nikola in 2021 agreed to pay $125 million to settle civil charges brought by the U.S. Securities and Exchange Commission.
Milton became an overnight billionaire when he took Nikola public through a deal with a special purpose acquisition company in June 2020. The company was quickly considered to be one of the most promising EV startups – valued at its peak at more than $30 billion – until allegations regarding false and misleading statements were uncovered by short-seller Hindenburg Research.
Prosecutors compared Milton to disgraced Theranos founder Elizabeth Holmes, who was sentenced to more than 11 years in prison last year for defrauding investors in her blood-testing startup.
“Just as Holmes lied about Theranos-manufactured blood analyzers, Milton lied about the operability of the Nikola One semitruck,” prosecutors wrote to Ramos ahead of the sentencing.

CEO and founder of U.S. Nikola, Trevor Milton speaks during presentation of its new full-electric and hydrogen fuel-cell battery trucks in partnership with CNH Industrial, at an event in Turin, Italy December 2, 2019.
Massimo Pinca | Reuters

Milton has attempted to distinguish himself from Holmes, whose company was private. His lawyers argued “that Nikola is still a real business, while Theranos is not,” according to court documents.
Milton, who was the company’s largest shareholder, stepped down as executive chairman of Nikola in September 2020. He did so amid an internal probe after the Hindenburg report, which characterized the company as a house of cards built by Milton.
Since Milton’s resignation, shares of Nikola have cratered and the company has failed to retain executives. Nikola Chairman Stephen Girsky, whose SPAC brought the company public, was named CEO in August.
Shares of Nikola have recently traded under $1, with a market value of about $296 million. The stock fell more than 9% on Monday.
Nikola was among the first heavily publicized companies to go public through a SPAC. It inspired hundreds of other startups to do the same before the SEC cracked down on the practice.
Prosecutors said the SPAC process, rather than a traditional IPO, allowed Milton to make many of the misleading or fraudulent statements. Under the IPO process, he would have not been allowed to make public statements during the time around the company going public.
SPACs are publicly traded companies that don’t have any real assets other than cash. They are formed as investment vehicles with the sole purpose of raising funds and then finding and merging with a privately held company. More

Walmart is adding increasingly popular lab-grown diamonds to its lineup.
The discounter sees an opportunity to sell more fine jewelry during the holidays, the peak season for engagement rings.
Other retailers have also catered to value-driven jewelry customers. Signet Jewelers’ Jared just introduced gold ingot charms, which can be worn on a necklace or stored in a safe.

SECAUCUS, N.J. — Here, shoppers can browse engagement rings, tennis bracelets and pendant necklaces displayed behind glass. Then, they can walk a few yards to grab milk, cereal or socks.
Welcome to Walmart.

During recent inflation, the world’s largest retailer attracted new and higher-income shoppers with cheaper groceries. Now, it’s trying to cater to that shopper with more fine jewelry at lower price points.
Ahead of the holiday season, the company introduced more styles of lab-grown diamond jewelry. It just started to test its largest lab-grown diamond offering yet — a 1.5 carat engagement ring that retails for $698. A mined diamond of that size can sell for a retail price of $6,000, said Walmart, which cited industry data and the typical markup.
Global sales for lab-grown diamonds grew to nearly $12 billion in 2022, a 38% year-over-year jump, according to an analysis by New York-based Paul Zimnisky, a financial and diamond industry analyst. That’s a sharp increase from under $1 billion in 2016, the analysis found.
The rise of lab-grown diamonds — which are made by people rather than mined from the ground — have made it possible for Walmart to carry a wider range of items that fit customers’ budgets, said Michelle Gill, the company’s vice president of jewelry and accessories.
And, she added, the company wants to test other statement pieces and bigger stones.

Walmart isn’t the only company looking for ways to serve shoppers seeking affordable jewelry. Signet Jewelers-owned chain Jared is testing a new product: a 24-karat gold ingot that is set in a charm and can be personalized, and then can be worn on a necklace or locked in a safe. The charm, which comes in different weights, arrived to about 60 of its stores ahead of the holiday shopping season.

Signet Jewelers-owned Jared started selling ingot charms at select stores. The circular or rectangular charms are made of pure gold and can be personalized.

So far, the charms have been a hit, said Claudia Cividino, president of Jared. Customers can personalize them or even inscribe them with a message in the gift-givers’ handwriting.
In times of uncertainty, people “look for stability,” she said. “Gold has always been a stored value. There’s something in the zeitgeist around gold and its properties.”

A high-stakes holiday season

Jewelry is a popular gift during the holidays. The period from October through February, including Valentine’s Day, is also the peak time for engagement ring purchases, Signet CEO Gina Drosos said in early December on an earnings call. Signet also owns Kay Jewelers, Zales and Diamonds Direct.
It could be tougher this season, though. Jewelry sales rose as consumers had extra money to spend on luxury goods during the pandemic and then sprang for extra sparkle as they booked vacations and went to parties. Social distancing during Covid also dampened the dating scene, which has translated to slower sales of engagement rings three or four years later. Signet and Brilliant Earth, a direct-to-consumer jewelry company, both cited this challenge on earnings calls.
Total jewelry sales were $73.08 billion in the U.S. in 2019, according to Euromonitor, a London-based market research company that tracks sales across a variety of retailers. That total is expected to hit $73.8 billion in 2023, Euromonitor estimates.

Fine jewelry has held up better than costume jewelry, however, though both have declined year over year. Sales in the fine jewelry category are expected to grow by nearly 4% compared with pre-pandemic 2019 to a total $62.85 billion in the U.S., according to Euromonitor. Costume jewelry is expected to drop by about 12% to $10.95 billion during the same period.

More sparkle for less

Walmart has carried jewelry since the 1990s, but it’s made a bigger play recently. It started carrying lab-grown diamonds last year in select stores. Now, it has expanded that to nearly 90 items that range from $78 to $498 available at the majority of its stores. In the past, many of Walmart’s items were made from a cluster of diamonds arranged to look like a single diamond, since mined diamonds cost much more, Gill said.
Gill, who worked for more than two decades at high-end department store chain Neiman Marcus, said Walmart also saw an opportunity to sell more fine jewelry, particularly in rural markets and parts of the U.S. dotted with struggling and shuttered malls.

Ahead of the holiday season, Walmart introduced its largest diamond yet — a 1.5 carat lab-grown diamond engagement ring that retails for $698.
Mike Calia | CNBC

Walmart does not break out category revenue, but it said lab-grown diamond sales have increased approximately 600% year over year. That reflects the addition of many more items to the category.
Yet for some shoppers, the idea of buying an engagement ring, anniversary present or other special purchase from the no-frills discounter is out of the question.
Gill acknowledged that Walmart will have to overcome that stigma. The retailer has had a similar uphill climb when trying to establish a reputation for carrying more stylish clothing by developing exclusive brands and teaming up with designers and celebrities. Plus, its stores don’t have dedicated jewelry specialists — something that Gill would like to change.
She said fine jewelry sold by Walmart comes in an elegant wooden box that isn’t marked with the Walmart name or logo.

“We’re elevating our experience in fashion,” she said. “We’ll continue to elevate our experience in fine jewelry.”
Yet she said younger shoppers, especially Gen Z, care less about brand and more about having the style or price they want. She saw that when her daughter, who is 22, recently got engaged and decided on a ring with a lab-grown emerald and lab-grown diamonds.
“This age group, they also love to go thrifting and they like to do secondhand and they rent their clothes online, so they can have new whether it’s for sustainability reasons or whether it’s for ‘I can do more with less,'” she said.

A new golden age

Other retailers, including Pandora and Brilliant Earth, have capitalized on the growth of lab-grown diamonds, too. Pandora introduced lab-grown diamond jewelry in the U.S. after it stopped using mined diamonds in 2021. The company has a growing presence inside Macy’s stores and on the department store’s website.
Brilliant Earth CEO Beth Gerstein said the company serves a different customer base than Walmart or Costco, which saw hot demand when it sold gold bars this fall, selling more than $100 million of them in the last quarter.
Gerstein said the direct-to-consumer jewelry company’s core shoppers are between age 25 and 40, have a household income of $75,000 or more, and tend to be more brand-focused.
Yet she said Brilliant Earth is offering prices and unique designs for shoppers on a budget this holiday season, along with those who are more willing to splurge. For example, she said, it introduced a lab-diamond bezel solitaire pendant necklace that costs less than $500.
She said the company’s holiday giveaways have drawn a stronger-than-usual response this year, too, as shoppers crave freebies. “The customer is looking for value wherever they can find it,” she said.
At Jared, Cividino said the average value of customers’ orders has risen slightly year over year, despite higher costs of many everyday expenses. Yet she said the jeweler has noticed customers visiting more or waiting longer before making a big purchase.
“People think harder before they make a decision,” she said. “That’s what we’re experiencing.” More