Consumer sentiments towards gold purchases during the festive period were muted for the last two years due to the pandemic, which had an adverse effect on the entire industry. The impact on discretionary spending was perhaps more pronounced than in other categories.
As the consumer economy shows glimpses of normalcy, jewellery brands in the country are very optimistic about the ongoing festive season.
“Consumer demand and sales were somehow muted during the festive seasons both in 2020 and 2021 due to the impact of the pandemic waves on consumer sentiment, economic activities and overall buying power. Cautious approach led to subdued festive demand and postponed weddings during 2020. However, consumer sentiment looked up during Dussehra and Diwali in 2021 on the back of relaxation in Covid restrictions, vaccination drive and the gradual revival of the economy,” says MP Ahammed, Chairman, Malabar Gold & Diamonds.
Therefore, Ahammed expects a robust consumer demand in the upcoming festive season driven by positive consumer sentiment and pent-up demand.
“A softened gold price is likely to act as a potent trigger to drive sales in the upcoming festive season. We are bullish on the upcoming wedding season as well,” he adds.
Parag Shah, Director, HK Jewels, echoes a similar opinion.
“Consumer sentiments this festive season have picked up in a big way. Compared to the 2020 and 2021 festive seasons, the big public celebrations are back. Consumers’ mood has picked up and they are eager to celebrate. We are already seeing an increase in consumer spending,” he says.
Shah further adds, “During the pandemic, we saw a shift towards customers using e-commerce and digital platforms to discover and interact with the brand. As we normalise again, we foresee a shift back to the in-store retail experience. However, online channels and e-commerce will continue to be an integral part for consumer awareness and a medium to tap into the younger generation.”
As the festive demand kicks in, Amit Pratihari, General Manager, De Beers Forevermark, is optimistic that this year’s festivity will be strong since all markets are completely operational after two years.
Speaking on the products that tend to see a spike in sales during the festive season, Ahammed says, “The consumer choice spectrum is increasingly becoming more diverse. From the category perspective, although gold jewellery is set to dominate the festive demand dynamics due to its investment value and socio-cultural affinity, diamond, colour gemstones and even platinum will strengthen their market share banking on new-age sensibilities.”
“As far as designs are concerned, Malabar Gold’s both traditional and new-age designs, fusion as well as evolved design innovations will find takers in the upcoming festive season. We have all the elements in our product portfolio to appeal to a broader range of consumers,” he adds.
According to Shah, heavier festive jewellery will always be in demand.
“There has been a spike in diamond jewellery because it complements traditional, western, and indo-western festive wear. We have seen consumers shifting to wearable diamond jewellery pieces across categories of rings, pendants, necklaces, and earrings that can be worn every day and for smaller occasions and festivals,” he adds.
“No doubt, the jewellery industry is witnessing a tremendous demand and in recent times, we have noticed a shift in consumer buying patterns too as they are now more inclined to purchase items that hold meaning and value,” says Pratihari.
According to Pratihari, owing to their inherent preciousness, diamonds are more sought after and have seen a rise in demand.
“While the year 2020 was a setback due to the pandemic, the industry made an enormous comeback last year. There is still a pent-up demand for jewellery and hence we foresee that this festive season will be extremely strong, accelerating the momentum of diamond jewellery sales. We are already seeing a huge demand for all our designs, especially everyday classic jewellery like the Forevermark Avaanti Collection for which we are also launching an extension line this season which will be the focus of our festive campaigns,” he adds.
Harvesting the Festive Spirit
Speaking on the marketing spends during the festive season, Ahammed says, “It’s obvious that jewellers earmark the major share of their annual advertising and marketing budget for the festive season to create the maximum buzz. Given the steady revival of the consumer sentiment, jewellers will surely scale up their festive marketing budget to capture the attention of their target consumer segments.”
“For us, planning an advertising budget is a strategic decision based on the consumer outreach strategy of a particular campaign. The budget is decided on the basis of demographic spread, media mix, media consumption habits of the target consumer segments, etc.” he further adds.
“As consumer spend is picking up and the big celebrations are back, we are expecting to see a definite increase in marketing spend,” says Shah.
“With the festivities in full swing, we are expecting a double-digit growth this festive season. With this growth outlook and strong demand, we continue to strengthen our brand through our authorised partners, our e-commerce platform, and our exclusive boutiques across the country,” concludes Pratihari.