Zale is multifaceted. One of North America's largest specialty jewelry retailers, Zale sells diamond, colored stone, and gold jewelry (diamond fashion rings, semi-precious stones, earrings, gold chains); watches; and gifts at some 1,580 stores and kiosks, mostly in malls, throughout the US, Canada, and Puerto Rico. The firm has a trio of large chains aimed at different jewelry markets: Gordon's Jewelers, flagship chain Zales Jewelers, and Piercing Pagoda. Zale also operates about 125 outlet stores, runs more than 200 stores in Canada under the Peoples Jewellers and Mappins names, sells online, and offers jewelry insurance. Zale was acquired by Signet Jewelers in mid-2014.
Change in Company Type
Bermuda-based Signet Jewelers, the operator of the Kay Jewelers and Jared the Galleria of Jewelry chains in the US, in May 2014 acquired Zale for $21 per share, a significant premium to its stock price. The $1.4 billion deal followed a strong holiday season (and year) for US jewelry sales and is a further step in the consolidation of the jewelry industry. Signet retained Zale's CEO Theo Killion to run the company.
The Zale division consists of two reportable segments: Zale Jewelry (972 jewelry stores in shopping malls under the national brands Zales Jewelers, Zales Outlet, and Peoples Jewellers, along with regional brands Gordon's Jewelers and Mappins Jewellers); and Piercing Pagoda, which operated 605 mall-based kiosks in early 2015.
Zale operates in the US, Canada, and Puerto Rico.
Sales and Marketing
Zale spent $83.6 million on advertising in fiscal 2013, compared with $94.5 million on advertising in fiscal 2012, and $76.5 million in 2011.
Zales Jewelry accounted for 18.6% of its parent's fiscal 2014 sales and 0.3% of operating income; Piercing Pagoda, 2.6% of sales and 1.1% of operating income. Zales accounted for 14% of Signet's sales in fiscal 2015.
Signet plans to improve its results through harnessing the synergies associated with the Zale acquisition and other initiatives around merchandising, real estate optimization, channel expansion and cost control.
Zale is positioned as "The Diamond Store" (diamond jewelry, especially in bridal and fashion). The Zales brand complements Signet's merchandise assortments with promotional strategies to increase sales during traditional gift-giving periods and throughout the year.