Getting creative to move merchandise

April 6, 2009 4:32:56 PM PDT
Our economic recession has forced many Americans to drastically reduce their spending, and for businesses, putting up a sale sign doesn't necessarily work anymore. [CHECK THE MARKETS: Get the latest numbers from Wall Street]
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So a Houston jeweler has come up with an eye catching promotion tied to the Dow.

For the first time since he opened the Diamond Jewelry Factory in 1975, Phil Finnerman is having a sale. But now he has little choice.

"The retail jewelry industry is not in good shape," he told us.

Actually it's in terrible shape with retail jewelry sales off by 50 percent across the country, about the same drop as the Dow. And that gave Finnerman an idea for a sale tied to the stock market.

The day before our interview, the Dow closed at 7,924, 44 percent lower than the Dow's all time high of 14,164. The next day, Finnerman was selling his jewelry and everything else in the store at a 44 percent discount.

"This is a 14 carat yellow gold ruby and diamond ring with three-quarter carat gold with half carat ruby," said Finnerman. "It's normally $1,400 dollars and today, it's $784, 44 percent, and I can promise you it's below cost."

At these prices, he's losing money on many pieces and could lose even more if the Dow drops say 55 percent and he must discount his jewelry 55 percent. But desperate times are forcing businesses to get creative.

Hyundai and Ford are selling more cars by offering to buy back your car if you lose your job. Walgreens is offering free health care services to people who lose their jobs and have no health insurance benefits. And Toys 'R Us has set up special displays of toys under $3 in an effort to woo thrifty shoppers.

Experts say those promotions and Finnerman's will appeal to consumers emotions.

"He's looking genuinely empathetic when times are tough," said Betsy Gelb with the University of Houston marketing department. "He's making it easier for you to buy."

"It would inspire me to buy a piece of jewelry that I would not normally buy," said customer Donna Kouwe. "Forty-four percent off would definitely inspire me."

"You can't do things the same old way," said Finnerman. "The same old 1,2,3,4 is not going to work."

To Finnerman, it's just a sign of the times.

"We have posted out on our marquis the Dow Jones close yesterday and our discount, and we hope to get it to the point where they drive on Westheimer, they look for that number," said Finnerman.

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