Mintel last examined the retailing of jewellery and watches two years ago. Since then consumers have been on a roller coaster of emotions. The possibility of terrorist action following 11 September 2001, and the subsequent war in Iraq created a mood of uncertainty among some. Stock markets fell sharply with the result that savers and investors lost out. In the meantime, interest rates have been cut to the lowest level in years, making the cost of borrowing very cheap. Their confidence buoyed up by rising house prices, consumers continued to borrow and this has fuelled a 'spending party'. It remains to be seen when the long-awaited lull will set in, as the realisation dawns that loans must be paid for.

The jewellery and watches market is polarising, with more volume being sold at lower prices, and increased demand in the premium sector. This has had a knock-on effect to jewellery retailing, with the retailers doing best in the everyday low-price segment of the market, and the premium sector. The market for jewellery is more innovative, fresher and with a greater fashion input than previously. Women, especially those at work, are beginning to spend more liberally on themselves, treating themselves to new things, including jewellery and watches. Men are also being inspired to wear more jewellery, following trends set by fashion icons like David Beckham.

This report looks at the key retailers in jewellery and examines the factors that are creating new opportunities in the market. It provides a major overview of the developments that have shaped the market over the last two years, examining its sector trends in huge detail. In addition, this report also contains exclusive insight into the consumer needs that underpin and determine the market dynamics.. It also incorporates a series of trade interviews, further bolstering your understanding of this retail market.

Providing new analysis of:

Retail sales/ Sector structure/ Consumer expenditure/ Market factors/ The consumer - trends and attitudes/ Retailer market shares/ Major retailers/ Retail practices and operational issues/ Future trends/

Sales forecast

Precious jewellery includes all jewellery fashioned from precious metals including gold and silver, precious gems and semi-precious stones, and natural and cultured pearls.

Costume (or fashion) jewellery comprises all jewellery made from non-precious materials including some gold- and silver-plated items, resin, plastic, wood and leather.

Watches include quartz analogue watches, quartz digital watches and mechanical watches.

The market values do not include duty-free, antique and second-hand items, although these outlets and market segments are covered in The Consumer section of the report.

The terms 'costume' and 'fashion' jewellery are often used interchangeably by consumers, and Mintel's consumer research takes account of this. However, 'costume' is the term more generally used within the trade.

Other recent reports of interest include:

- Costume Jewellery - UK, Market Intelligence, September 2003

- Luxury Watches - UK, Market Intelligence, July 2003

- Fashion Accessories Retailing - UK, Retail Intelligence, July 2002

- Clocks and Clock Radios - UK, Market Intelligence, June 2002.