Akshay Tritiya 2021, a washout due to Covid-19 second wave; consumer sentiment hits a new low

Akshay Tritiya 2021 has put the resilience of Indian jewellery industry to one of the toughest tests so far. The overall consumer sentiment is aligned more towards healthcare due to a high mortality rate in the second wave of Covid-19. Still, the deep trust on the fundamental notion of Akshay Tritiya gave some relief to jewellers in parts of the country.  

Obviously, the scale of business is nowhere near comparison with pre-pandemic times. But the new normal has trained many brands to appeal to the customers in ways earlier uncommon, even as different states struggle with various degrees of lockdown stricture.

 Online eases immediate demand woes 

Brands ranging from chain stores to family jewellers used omni-commerce to book sales on this auspicious occasion. GJC chairman and Director, WHP jewellers, Ashish Pethe said that there has been a 25-50% increase in overall sale through e-commerce.

“Since e-commerce platforms still comprise a very small share of the overall gem and jewellery industry, it has a small base and thus registered higher growth than last year,” Pethe added.

According to business strategy director Suraj Shantakumar from Kirtilal, Coimbatore, “Backed by e-commerce, we recorded slightly better sales than 2020. The customers were more acquainted with the modes of online transaction.” The retail chain with over 12 showrooms across south did intense social media promotion.

Kanpur-based Vivek Kumar Gupta, Director, Lala Purshottam Das Jewellers said, “Unlike last year, this time we were ready with our e-commerce platform and I think it helped us immensely during Akshaya Tritiya. The overall sale is 10% more as compared to last year. He claimed to have also made several home deliveries as many customers had asked for urgent and same-day delivery.

CKC Jewellers from Banglore has appealed to the tradition of Akshay Tritiya with a unique artefact called Akshay Patra. The item consists of a golden bowl having a mixture of golden and silver rice, costing around Rs 1 lakh. That has struck a chord with buyers having firm belief on the occasion.  Vinod Hayagriv, MD and Director, CKC Jewellers, said that combined  effort of omnichannel systems on WhatsApp, phone calls, and the brand’s web platform ‘CKC Live’ have helped accrue only 10% of the pre-pandemic business during Akshay Tritiya.

According Shantakumar, “Akshaya Tritiya is about bringing home prosperity. Since that was not possible because all the showrooms were shut, only a limited section of people showed interest in online booking during Akshaya Tritiya.”  Milin Shah from Kalamandir Jewellers, Surat, echoes the same opinion, “The telephonic enquiries surpassed that on e-commerce. We could satiate customer enquiries via video calls with sales staff. We did better than last year, although it is dismal in comparison to pre-pandemic sales.”

For TBZ, Binaisha Zaveri said that their online gold savings plan was active from 2020, which helped customers book their gold on this occasion. For Kalyan Jewellers, only 20% of their Indian showrooms are in function subject to regional time restrictions. While that doesn’t paint a good picture of the business health, executive director Ramesh Kalyanaraman said claimed that,” The Kalyan Jewellers Gold Ownership Certificate, launched during last year’s lockdown continued to see traction this Akshay Tritiya,” he added.

Nitin Bardiya of Anopchand Tilokchand Jewellers, Raipur, said, “The enquiries and conversion for high-value and price-point jewellery have been promising considering the scenario today and buyers will have their good delivered after lockdown ends.” Comparing with pre-pandemic year, we managed to get only 5% of business on Akshay Tritiya, he added.

Most brands came out better prepared for the second lockdown with e-commerce and online purchase plans even as they seamlessly transferred the burden of physical interactions with customers to strong back-end team attending customer queries via social media, telephone, WhatsApp and focused on prompt deliveries.

Rural weddings saved the day

Jewellers operating in tier cities benefited from nearby rural belts that did not see slowdown in wedding plans.

Gupta from Kanpur booked almost only 40 percent of the sales in gold jewellery. “Thankfully marriages are still happening in the villages. There was a good demand for wedding jewellery between Rs 3-5 lacs.” Due to the current situation, customers are looking to spend a limited amount on jewellery. 

“Ninety percent of the bookings we got this year were in the mid-ranged bridal gold jewellery between Rs 4-5 lacs,” says Abhishek Bafna, sales and marketing manager of Ratanlal C Bafna Jewellers from Jalgaon in Maharashtra.

Raman Jethi, director, Krishna Krishna Jewellers from Panipat said, “Although customer enquiries have reduced by 80%,  jewellery sale was possible because marriages were still happening in villages.”

The situation, however, is different for TBZ, which has witnessed a dip in bridal jewellery sale because of marriage cancellations due to lockdown. “There has been a small portion of customers from towns and villages who are buying high-ticket items, but the mood in metros is really somber,” said Zaveri.

Bullion Nosedives  

Many jewellers observed that last year there was mixed response in bullion and jewellery buying. However, this year the demand for bullion was relatively low.

One of the reasons is the fluctuation of gold rates, opines Bafna. “Last year, the gold rates soared to an all-time high during the lockdown driving customers to buy gold from an investment point of view.” 

However, the gold rates are much stable this year and with an increase in fatalities, customers are not currently looking to invest in gold. Bafna accepts having done much worse business than last year, “Bullion was only around 10% of the total sales this time.”

Kumar from Kirtilals echoes a similar opinion. “Bullion contributed to only 20-25 percent of the overall sales. We registered a spike in sale of small-ticket and non-bridal jewellery items.” Pethe witnessed an increase in the ticket size of price-point jewellery sold online from Rs 5,000-10,000 last year to about Rs. 25,000-30,000 this year.

On the flip side, jewellers are seeing an unprecedented dip in demand of high-value jewellery. “The buyers for high-value jewellery have decreased by 75-80 percent and more buyers are looking towards price-point jewellery as they want to hold on to the cash to meet the medical emergencies,” says Jethi. ‘The mid-segment customers who use to enquire about the gold are completely silent this time,’ he adds.

Message supporting healthcare

Jewellery is not on people’s priority list today as they are more invested in healthcare. “There are transactions happening in the Rs 5 lakh- 20 lakh range,’ said Hayagriv, adding that such figures don’t reflect the current customer sentiment for the occasion.

The purchasing intent is almost negligible in states with extremely high mortality rate such as Rajasthan and Madhya Pradesh. This grim scenario presents sensitive brands such as DP Jewellers with an opportunity to focus on the message of healthcare and keep revenue expectations from Akshay Tritiya in the back burner.

Amit Bandi, CEO, DP Abhushan said that the brand has refrained from promoting jewellery collections this time. To show to its existing and expanding customer base that the brand cares, there has been mindful social media promotion of messages asking people to stay safe at home. “As a legacy brand, DP Abhushan wants its buyers to realize how optimum health is the biggest wealth one can hope to have now. Why not celebrate this Akshay Tritiya safely with your loved ones at home?” said Bandi.

Dire appeal for relief

The second wave has struck India worse, said GJC chairman Ashish Pethe. The Gem and Jewellery Council has had a support system in place since last year. The association had created a fund for needy karigars affiliated to associations or independent. “In that system, we confirmed the bona fide Aadhaar numbers of respective karigar and transfer an amount as donation directly to their account numbers for monthly sustenance of their families,” said Pethe. He added that initiative has been expanded in light of the second wave, as the fund is also used to avail medical needs such as procuring oxygen cylinders this year.

However, the chairman has also appealed to the government to exercise trade lenience for small retailers who have exhausted their working capital. He reasoned that 2020 had a nationwide lockdown, for which the RBI granted relaxations to everyone, but 2021 has different conditions across lockdowns in different states.

“I ask the government to help such small retailers with deferment or waiver of interest rates. It would be beneficial if they are not brought under the Non-performing Assets ambit, as that would cause them to shut their business down,” said Pethe.

By Shubham Dasgupta/Manoj Chakraborty