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DAVID YURMAN OPENS HIS OWN JEWELRY STORES

By Maura K. Ammenheuser

Those who know can spot David Yurman’s jewelry without being told. “It has a very, very specific image,” said Candace Corlett, a principal at WSL Strategic Retail, a New York City-based consulting firm. “You can spot David Yurman jewelry on someone.”

Modern yet timeless, Yurman’s styles offer intricate detail without sacrificing clean, sleek lines. A cable pattern used especially in bracelets is the brand’s hallmark. Those unfamiliar with Yurman’s look will probably come across it soon. The iconic jeweler, in business since 1979, has sold his wares at department stores such as Saks and Neiman Marcus for many years but has recently begun opening boutiques under his own banner. Independent David Yurman shops can now be found in several high-end American malls, including Bal Harbour (Fla.) Shops, King of Prussia (Pa.) Mall and South Coast Plaza, Costa Mesa, Calif.

Yurman started using distinctive black-and-white print ads featuring such supermodels as Kate Moss and Naomi Watts around 2001. Between the ads and the growing chain of stores, Yurman is enjoying increasingly broad name recognition. And luxury malls are reaping some of the benefits.

Yurman still sells through department stores. Mall at Millenia, Orlando, Fla., has a Yurman boutique, and that mall’s Neiman Marcus and Park Promenade Jewellers carry the line too, says Brenda Lounsberry, the mall’s marketing director. But the Yurman boutiques carry couture items that shoppers will not find in the more limited department store collections, she says.

And yet David Yurman is not necessarily just for the super-rich. Sure, if one’s taste runs to, say, the Jewel Bead 18-karat yellow gold, box-chain earrings with pavé diamonds and faceted madera citrine, one’s price tag will run to $3,050. But one could also catch one’s breath and turn instead to a pair of sterling silver and 14-karat yellow gold Thoroughbred earrings for a mere $245. In between are a pair of diamond crossover earrings from the Silver Ice collection, in sterling silver and 14-karat white gold, for $990. “It’s approachable at all economic levels,” Lounsberry said. Yurman opened its 1,000-square-foot shop at Mall at Millenia in late 2005. Many of the company’s designs have add-on elements, Lounsberry says, meaning that a customer can buy a chain and add charms to it later, say.

Yurman is not as recognizable as Cartier, Van Cleef & Arpels and similar high-end labels among Americans with annual income of at least $200,000 and $5 million minimum net worth, according to a survey by The Luxury Institute, which tracks the habits of the wealthiest 10 percent of Americans. “Most consumers see it as a good buy,” said Milton Pedraza, the institute’s CEO. They do not necessarily consider it a super-luxury brand, he says. The survey shows that those familiar with David Yurman merchandise praise its quality. And it’s not about exclusivity, Pedraza says. “It’s about the uniqueness of the design.”

Yurman initially worked with silver and then branched into gold, gemstones, and now minerals and such unusual materials as dinosaur bone, says Helena Krodel, media manager for the Jewelry Information Center, a New York City-based trade association. “Especially for men, there’s a whole science side of it — a cool factor,” Krodel said.

A spokeswoman for David Yurman declined requests for an interview, saying the private company does not want to discuss its expansion plans. Other sources describe an established business controlled by its founding family. Yurman’s wife, Sybil, also designs jewelry, and so does their son, Evan, according to press reports that credit him with building the company’s men’s line.

David Yurman annual revenue is an estimated $450 million, according to Krodel — a drop in the ocean compared to Zales, the top American jeweler, which operates 2,230 stores and posts some $2 billion in yearly revenue. Krodel cites an annual ranking in the National Jeweler trade magazine. Sterling Jewelers’ 1,307 stores post revenues of $1.8 billion annually, according to the Sterling Web site. But Yurman comes in close behind the No. 3 Friedman’s, which posts yearly sales of $468 million.

Patricia Pao, founder of Pao Principle, a New York City-based retail consulting firm, estimates that Yurman’s sales per square foot are roughly triple the average for department stores. “There is a universality to the design and also a range of price points that make it very accessible,” said Deirdre Costa Major, president of Americana Manhasset (N.Y.), where Yurman has a 900-square-foot boutique within a London Jeweler store.

Besides the traditional women’s pieces, Yurman offers charm bracelets for children, watches and the men’s line. The styles appeal to both the fashion-forward and those preferring conservative classics, says Costa Major. Yurman’s boutiques also sell limited-edition items aimed at the wealthiest customers. Costa Major herself buys Yurman jewelry as gifts, especially diamond earrings.

Interestingly, several sources compare Yurman more often to handbag giant Coach than to other jewelers. Pedraza says Yurman’s “affordable luxury” brand image is more akin to Coach than to the pricy Louis Vuitton or Gucci. “Yurman is going to follow the Coach model, using freestanding stores to brand-build, create awareness and excitement and leverage into other product lines while keeping his wholesale business (e.g., department stores, specialty stores) to his core line,” Pao wrote in an e-mail.

Wholesalers open their own stores to better control their image and because they know that a great many shoppers do not venture into a department store, says Corlett. Clothing designers frequently shift from selling through department stores to opening their own shops, but this strategy is less typical for jewelry manufacturers, at least in part because jewelry is expensive and time-consuming to produce, says Krodel. Yurman is among the few manufacturers that rise from the wholesale world into retail, and De Beers is another, she says. The fact is, you need a pretty big following to open your own chain, and that is hard for designers of fine jewelry, experts say. “Fine-jewelry designers do struggle to get brand awareness,” said Krodel. They have no runway shows or similar vehicles to win them notice to the degree that fashion designers enjoy.

But becoming a retail chain is a good move for Yurman, sources say. “They have maxed out their growth in existing U.S. distribution,” Pao wrote in her e-mail. “Basically, their price points dictate that they have a maximum of 150 doors. Their desire to control their in-store image and branding prohibits them from partnering with mom-and-pop jewelry stores, and large chains such as Tiffany’s are more interested in developing and promoting their own private label brands.”

Pedraza says Yurman is going more upscale with its own chain of boutiques. “The brand has great potential to go from premium to true high-end luxury,” he said. As Yurman grows as a retailer, however, it will have to sharpen its skills, Pedraza says. Like any wholesaler moving into a retail arena, Yurman must develop or hire people with the appropriate real estate, marketing and other abilities. But Yurman is familiar with the upscale market, Pedraza says. “They’re up to the task. The most important [thing] is customer service, relating to the customer.” And Yurman has the corporate culture to nurture that, he says.

It’s unclear who Yurman’s competitors are. Pedraza says Yurman customers shop a variety of upscale jewelry brands, but other than Mikimoto, which is known for pearls, there are few other high-end chains offering a distinctive jewelry collection from a single design house.

The Yurman customer is “someone who likes classics with a twist,” according to Krodel. And Pao admires the way Yurman has made the metal rope cable style its signature. “While many designers have tried to mimic this look, they have not been successful, as David Yurman has staked out this look as their own,” wrote Pao.

There’s plenty of room for David Yurman to boost sales and open stores, Pedraza says. Only 36 percent of Americans with a net worth of at least $5 million are aware of the Yurman name, according to the Luxury Institute survey, as opposed to the 80 percent familiar with Tiffany. “Because of the nature of his designs,” Lounsberry said, “he stands on his own.”