How Pandora Jewellery grew to become a mega global brand

How Pandora Jewellery grew to become a mega global brand

Mary Teresa Bitti | January 22, 2014 | Last Updated: Feb 24 9:35 AM ET

Reg Shah has seen his share of jewellery fads come and go during his decades-long career in the industry. So when Pandora jewellery first entered Canada in 2004, he wasn’t sure how it would be received. Still, when a good friend told him about its long history and success in Europe, he decided to take a chance and sell it at his own store, Michael Anthony Jewellers, in Edmonton.

“It took off immediately. I had never seen anything like it,” he said. “It surprised me because in North America not many people had heard about it but its concept of affordable, personal luxury really resonated with buyers.” When the brand started selling franchises in Canada in 2011, he was among the first to put his name forward. He now owns four Pandora franchises with two more coming online in 2014.

Founded in Copenhagen in 1982 by a Danish goldsmith, Pandora is now a global brand with some 10,000 retailers in 70 countries around the world. In 2011, more than one piece of Pandora jewellery was sold every second. Vertically integrated with inhouse design, manufacturing, global marketing and direct distribution, Pandora spent the first two-thirds of 30-plus years honing its business model, brand and mission: to make high quality, personalized jewellery accessible.

Global growth did not begin until 2003 when the brand entered the U.S. with its highly popular signature charm bracelet. “It started small in Maryland, selling on a wholesale basis to gift stores and then jewellers,” said David Lamb, manager of franchise development.

“As it began to catch on, we started selling more to branded jewellery stores and within those environments we had different levels of participation based on how much product a customer bought and how much space they devoted to selling Pandora products. In this wholesale model, the highest level branded environment was a shop in a shop. It’s a decidedly slower growth model but one that has been successful in most parts of the world.”

In 2008, Pandora opened its first U.S. retail store in Mall of America in Bloomington, Minn. (the first Canadian store opened in the Shops on Steeles in Thornhill, Ont. in late 2009). It launched its franchise model in 2009 in Australia, and the first U.S. franchise store opened in 2010.

Now, there are 332 Pandora franchise stores in North America, the Caribbean and Central America, with 55 spread across Canada.  “We were a product that became popular during the market crash and I think the timing had a lot to do with the franchise success,”  Mr. Lamb said.

“Jewellers weren’t selling as many high ticket items then our product came along. It was a new look, affordable, interchangeable and it’s all about life memories and unforgettable moments. Consumers love it.”

Mr. Shah agreed: “As a traditional jeweller, I can tell you this brand has saved a lot of jewellery businesses throughout the U.S. and Canada. That’s how strong it is. Pandora helped the jewellery industry come out the other side of the recession.”

As for consumers, they love it so much that Pandora is now in most of the major, high-traffic retail centres across Canada. “This concept was created for regional shopping malls with a lot of women’s fashion brands and that’s the model we’re staying with,” Mr. Lamb said. “Our strategy was to pick the best mall in each market to start, see how the stores performed and go from there. Most of the franchisees came from the dealer base of jewellers we had already established and the majority own multiple locations.”

The total investment required to set up a franchise sits at $800,000 to $1-million a store.

As a franchisee, Mr. Shah says he receives tremendous support from Pandora in all areas of the business: operational, merchandising, product development, performance metrics, real estate, training.

“They are a true partner. The regional operating managers are attuned to my staff in every location. They pay a lot of attention to what’s happening in the store and are always looking for feedback on how how to improve and keep moving forward.  They are willing to roll up their sleeves to make sure the business is pointed in the right direction.”

Pandora’s winning marketing strategy

As a company, Pandora is extremely strong when it comes to establishing effective marketing strategies. Keshia Holland, marketing manager, PR and online, shares Pandora’s approach to marketing:

Q Where do you focus your efforts, traditional media or social media or both? 

A We spread our efforts across all media channels: traditional media (print, broadcast, online) and social. The beauty of the brand is that we encourage our consumers to share the personal stories and unforgettable moments that make life extraordinary. Our jewellery is designed to encourage the sharing of those stories with others, and social media is organically a perfect fit.

Q How do you decide where to direct your efforts? 

A It depends on the message we are trying to communicate. We still use traditional media to push our key messages across because reach and frequency is extremely important but social media gives us an opportunity to engage with our consumers directly in a way that is impossible with print and broadcast.

Q Who is your target market? 

A While we believe there is something in the collection for every woman, our sweet spot is women ages 25 to 49. In recent years we have expanded our key demographic to include a younger audience.

Q How important is event sponsorship? 

A Our sponsorship efforts go beyond events. We want to be sure that we do our part to encourage women to embrace their individuality. Pandora prides itself on being an organization that encourages and supports organizations that work to improve the lives of women and children. What we try to do on a local level is allow our retail partners to sponsor events so both the store and the organization has a local contact. It creates foot traffic for the store and gives the organization someone to go to in the future.