Signet Jewelers, the world’s largest retailer of diamond jewelry, announced its acquisition of Rocksbox, a personalized jewelry rental subscription service, for an undisclosed sum last Tuesday. The acquisition is part of Signet’s Inspiring Brilliance business strategy, which focuses partly on accelerating the company’s growth in e-commerce and service revenues.
Signet is confident that this addition will boost its growth and help acquire new customers within the jewelry industry.
While Rocksbox started from humble beginnings, the company will be able to add $200 million in revenue to Signet’s traditional business model by leveraging subscription trends customers are craving.
Expanding Traditional Jewelry Sales into Subscription
Signet’s official debut into the subscription industry will create a new revenue stream while expanding its customer acquisition strategies.
The company is the parent of well-known banners like Zales, Jared, and Kay Jewelers. Its annual sales reached over $6 billion last year while overseeing close to 3,000 stores. With Rocksbox as the newest part of the organization, Signet anticipates $1.5 billion in revenue in Q1 2022 compared to the $850 million it generated in Q1 2020.
Signet has been monitoring the subscription space for some time now. Prior to the pandemic, the company surveyed 1,300 women and asked if they would consider subscribing to a jewelry rental service — and more than 80% said yes.
“We look forward to bringing Rocksbox’s outstanding services to more customers, and to introducing those new customers to the balance of Signet’s banners,” stated Signet CEO Virginia C. Drosos in a press release.
A Win-Win Acquisition
Signet, like many other traditional companies, had to adjust to an unprecedented year due to the coronavirus pandemic. Mall traffic took a hit in 2020, decreasing by close to 96% year-over-year last April.
However, Signet’s issues with mall customers began before Covid-19 appeared, with the company shutting down more than 500 stores in the last three years. Consumers began prioritizing online shopping and made fewer mall visits, according to the Wall Street Journal. With company sales declining due to the shift in consumership, Signet was forced to adapt and had to cut its losses.
The company’s pivot to subscription seemed like the next logical step, and Rocksbox could be the foundation of a bright future.
The subscription company was launched in 2012 by Meaghan Rose and aimed to simplify the jewelry purchasing experience. Before establishing herself within the subscription space, Rose lent her friends and family jewelry from her own personal collection, which sparked the idea for Rocksbox.
For $21/month, Rocksbox members receive a customized set of three pieces of designer jewelry and can decide to swap them out or purchase them at the end of the month.
Rocksbox raised $11.5 million — mostly in venture-capital funding — in 2017, according to JCK. Drosos expects the subscription company to be a strong contributor to Signet’s future success despite the unknown number of subscribers Rocksbox currently has, according to Forbes.
This acquisition offers Signet new customer outreach opportunities while enhancing Rocksbox’s own market and jewelry options. “We are excited to join Signet and to play an important role in its purpose-driven growth strategy – Inspiring Brilliance – while also taking the company we’ve so passionately grown to an entirely new level,” Rose stated in the press release.
Key Takeaways:
- Signet Jewelers acquired Rocksbox, the leading jewelry subscription service, this week.
- The acquisition is part of Signet’s Inspiring Brilliance business strategy, which is expected to generate an extra $175-$200 million in the next three years.
- Rocksbox will help Signet establish itself in the e-commerce space and the subscription industry.