New ways for old treasures - Eppli relies on artificial intelligence for jewelry valuation

200, 15,000 or 400,000 euros? If you want to know what your ring, necklace or watch is worth, you need the advice and assessment of experts. The Stuttgart auction house Eppli deals in luxury vintage pieces and, with the help of DDG AG, is currently developing artificial intelligence technology that will make jewelry valuation faster and more transparent. It does not replace the human expertise that has grown over decades - it complements the valuation of Eppli's experts. By taking the step to develop and deploy AI technology, Eppli and DDG are pioneers in the industry.

Face recognition, chess games, voice assistants, autonomous vehicles - artificial intelligence has arrived in many areas of our lives. It is supposed to support us, relieve us of tasks and optimize processes. In short, it makes life and work easier. This advantage has also been recognized by the Stuttgart-based company Eppli, the largest auction house in southern Germany and a dealer in luxury vintage pieces. In the future, it will incorporate artificial intelligence in the evaluation and appraisal of offered valuables. With the use of AI technology, Eppli and DDG are breaking new ground as pioneers in the industry.

Customers can present their treasures to the Eppli experts at nine locations. The art historians, watch experts, gemologists, numismatists, fashion experts, estate consultants and generalists examine the items - from artwork to jewelry to designer clothing - and advise customers, provide an initial assessment of value and also prepare appraisals and valuations on pieces. "Sifting through and evaluating data in particular often takes a lot of effort; it's time-consuming and costly," says Ferdinand Eppli, managing director of the auction house and family-owned business. This is often opaque to the owners of the jewelry who want to sell their pieces, he adds.

Sales of pre-owned jewelry are growing - and so is the demand for appraisals

Technology for automated appraisals of vintage luxury pieces already exists, but it is not yet efficient. And efficiency is not only beneficial for customers, but also for experts and the company. After all, the market volume for second-hand jewelry and watches was 21 billion euros worldwide in 2020 and is developing faster than the primary market for these luxury goods, with eight percent sales growth per year. As a result, the demand for professional valuations, appraisals and expert opinions is also increasing.

Eppli has DDG AG at its side as a partner for the completely new AI technology, which works with various medium-sized companies to solve industry-specific problems with new technologies. DDG supports Eppli in the development of a working prototype and later in a meaningful commercialization and go-to-market strategy for the jointly created solution. Eppli's decades of expertise in jewelry valuation will continue - but the AI-based solution can speed up, make more transparent and optimize manual processes.

But how does AI work in jewelry valuation? Based on a lot of data that Artificial Intelligence and self-learning algorithms evaluate and assign. Patterns are recognized and corresponding rules and regularities are derived. Philipp Schramm, Chief Operations Officer (COO) of DDG AG, explains, "In the case of Eppli, the artificial intelligence matches the piece of jewelry to be valued with two data sets: visual data on the one hand, and text and other unstructured data, such as expert opinions and supporting documents, on the other." The current value of the raw materials used in a piece of jewelry, such as gold or gemstones, is also included.

AI incorporates sales and auction data, age, style and fashion trends

"By incorporating current and historical sales and auction data from various web stores and auction platforms, the AI is able to match prices achieved to comparable pieces based on the age, style and make or brand of the manufacturer's brand into the valuation," adds Alexander Fridhi, CEO of DDG AG. "Factors such as fashion trends or collector values can also be taken into account in this way." In the end, the AI gives a price range for the piece of jewelry.

Sifting through and evaluating such data has also been the responsibility of Eppli's experts in the past - and they will continue to keep this in mind. "AI can support our experts in their work because, for example, large amounts of data can be evaluated in a very short time," says Ferdinand Eppli. The evaluation of jewelry should thus become more efficient, more convenient and faster.

Faster - what does that mean? For simpler pieces of jewelry, such as plain gold rings without gemstones, an evaluation could be done in real time, so to speak, as DDG CEO Alexander Fridhi estimates. For more elaborate jewelry, more complex processes and multiple AI models might have to be added. "But even in these cases, the automated evaluation of the AI takes only a few minutes," Fridhi said.

Multiple models and methods: Object recognition in images, text mining, NLP.

Regarding the keywords procedures and AI models: DDG AG makes use of various technologies - for example, "Object Detection", the automatic recognition of objects in images. "This has already been successfully used by partner companies of ours in the construction sector to locate objects," explains Philipp Redlinger, Head of Innovation at DDG AG.

Natural Language Processing (NLP) is also a component of the AI used at Eppli, as is text mining - the processing of human written language. Philipp Redlinger adds, "This plays a role especially in searching for transactions with comparable valuables based on the descriptive texts in various web portals." DDG AG has already successfully applied this technology to the automated classification and keywording of business emails based on their content.

But the technology also has its limitations. AI models, Philipp Redlinger explains, can usually only recognize patterns and signals in the data if they are also part of the data sets used for training. It is difficult for an AI to work with signals that were missing from the training data or with patterns that change over time. But, "They can be included via re-learning the model, called retraining."

Limitations of AI: sentimental value and celebrity bonus

There's another kind of limit, too: AI doesn't have sentience or empathy. While artificial intelligence may be free of its own likes and dislikes, unlike human experts; even the best algorithm can never match the sentiment of a human. In particular, jewelry from celebrities that is to be auctioned or sold often has an individual, sentimental value for someone. Reference values from other transactions where items from celebrities have been offered can serve as a guide for the AI. And the better known a celebrity is or was, the higher the chance for the technology to find comparative values on the web and to take the "celebrity bonus" into account, at least roughly.

Nevertheless, Ferdinand Eppli makes it clear: AI will support and supplement jewelry valuation by his experts - but by no means replace it. support and complement - but by no means replace. "We have a very large proportion of customers in the 65+ age group in jewelry valuation, and for these people, personal advice will continue to be very important." However, Eppli also wants to use AI to respond to the younger target group that the auction and trading house has been able to attract in recent years. In addition, with AI, Eppli can address a larger customer base, far beyond the borders of Stuttgart or southern Germany - digitization makes it possible.

AI could also determine the authenticity and quality of gemstones in the future

However, Ferdinand Eppli is already thinking ahead and sees a lot of potential for artificial intelligence in the field of jewelry and gemstones: "I assume that with the use of AI, a lot will be possible that we can't even imagine at the moment." One example? "It may also be possible to determine the authenticity or quality of gemstones, such as color, purity or cut, via AI."

The CEO of Eppli is thinking about the development of an AI for jewelry valuation naturally also thinks about the family business: "I'm counting on it helping the Eppli brand to develop further as a result and to maintain and expand its character as an innovative, dynamic brand in the 'Pre-Owned Luxury Goods' sector."

Contact Press

Auktionshaus Eppli
Alina Romann
Marktplatz 6
70173 Stuttgart
0711 997 008 100 141