If you are planning to start an online jewelry business, here are the common mistakes to avoid to prevent losses.
Even with the health crisis, the sales of jewelry remain strong. The global revenue may have lowered in 2020, but the online jewelry sales statistics in the US forecast that consumers will spend $7.6 billion buying jewelry online in 2021. That is a 0.72 percent increase from 2020!
Statista also found that the US jewelry market size is expected to keep expanding at an annual growth rate of 0.8% in the next few years. With those statistics in mind, starting an online jewelry business is still a profitable move.
However, just like with any business, there might be inevitable setbacks that can lead to losses. That is why it is crucial to learn the common mistakes online jewelry businesses make. It will definitely not all be rainbows and unicorns, even if you have already built a solid online presence and a steady customer base.
So without further ado, here are the six common mistakes of online jewelry businesses to avoid:
- Not researching your supplier.
- Not spending enough time on market research and target audience.
- Not having a consistent and clear plan.
- Ignoring customer queries.
- Running too many promotional campaigns.
- Investing too much in online and social media ads.
#1 Not researching your supplier.
First off, you would need to find a supplier that will provide you with your inventory. If you do not research your wholesale fashion jewelry supplier well, you might end up losing your investment. Important things to check before negotiating with a wholesaler includes:
- Reviews: First off, check for reviews. If the company has a lot of bad feedback, time to look for a more reliable one. Having none may also be a red flag.
- Legitimacy: Is the company legit? Or is it just a fly-by-night business? Check if they have a physical address and social media accounts.
- The jewelry pieces they offer: Are the pieces trendy? Are they really made from the material the company claims to be?
- Reliability and dependability. A good jewelry wholesaler is one that is reliable when it comes to shipping your orders and return issues.
#2 Not spending enough time on market research and target audience.
Aside from your supplier, researching the market and your target customers are very important. You have to determine what type of jewelry sells best online, what the trendy styles are, and also your main competitors. Do not order designs because you personally think they are pretty. Remember that it is not you who will wear them, but your target customers.
If your target market is the Gen Zers and millennials, make sure to offer pieces that will appeal to these age brackets. To find this out, you can conduct surveys among your friends or people from these age brackets.
#3 Not having a consistent and clear plan.
Online shops, just like physical stores, need a formal business plan to operate smoothly. However, it does not need to be complicated; just focus on your goals, your budget, what jewelry type you want to sell, your price range, and your target market.
All these things must be planned out so business operations remain consistent and organized. You don't necessarily need to hire someone for this. Just as long as you keep priorities straight, you are sure to achieve your business goals.
#4 Ignoring customer queries.
Running a business can be very hectic. Too hectic that you might forget to answer questions from your people. Ignoring their messages is a big no-no, as these potential customers will lose interest in your business as a whole.
Remember that you don't just sell jewelry; you sell service too. Make it your goal to provide shoppers with a great online shopping experience to increase the chances of them turning into loyal customers.
#5 Running too many promotional campaigns.
Running too many promotions is a classic case of giving too much but receiving nothing in return. Freebies and exclusive discounts help really well with building online exposure but overdoing it may be detrimental to your business.
Make sure to review your promotions before going ahead with them. Consider your return on investment. You can focus on providing free guides that will be of great use to your customers. For example, an extensive cleaning guide is a great idea, as well as exclusive access to an online community that focuses on the latest jewelry fashion trends.
#6 Investing too much in online and social media ads.
Just like promotions, you should also avoid spending too much on online ads. Once you've built brand awareness and credibility with a few ads, pause your campaigns for a while. Use the time to focus on orders and other exciting things you can bring to the table for your customers.
The holiday season is a big exception, as this is the best time to run ads. Many businesses will be spending on ads to cut through the noise, so you should do the same. Studies also found that the return on advertising during holidays is relatively high, so it's worth the investment. Even if your target customers aren't actively shopping, a targeted and well-placed ad can lure them to your e-commerce site.
Another reason to run ads is to promote a new jewelry collection or if you have clearance sales. Just remember to correctly target the right demographics to avoid putting the funds on these ads to waste.
Running your own online jewelry business is fun, especially if you love wearing fashion jewelry yourself. But as mentioned above, it's not all rainbows and unicorns, so you should be mindful of making business decisions. Sometimes, a risk may not be worth it.
Market and target audience research helps a lot, and so does listening and acknowledging your customers. Building genuine relationships with them also is a plus, as this increases the chances of word-of-mouth advertising.