Connect with us
RJI

RJ Market Watch

Phased in-store relaxations impact jewellery sale with phenomenal contrast countrywide

As FMCG and related sectors remain open at only a particular time of the day, jewellery being luxurious products has just seen some relaxation in terms of in-store activity.

Published

on

The adage ‘different strokes for different folks’ rings true for the statewide anomaly in lockdown restrictions in India and jewellers are of no exception. As FMCG and related sectors remain open at only a particular time of the day, jewellery being luxurious products has just seen some relaxation in terms of in-store activity. But the rule changes statewise and thus, there is a huge disparity in the customer response jewellers have been getting.

It’s a mixed market down South now

Let’ start with the south. There has been no relaxation in Karnataka. Since the lockdown on April 24, the state government has restricted opening of jewellery showrooms there and this will extent till June 14.

“The request from the association for relaxation on the occasion of Akshay Tritiya had also been rejected by the chief secretary. However, 9 out of 10 enquiries on information about our jewellery on websites and social media. People are asking about gold prices and thus we have contact details of our sales staff circulated on social media for any sort of enquiries,” said Pratap Kamath, director, Abaran Timeless Jewellery. 

However, the director boasts of enquiries of solitaires and bridal categories as well. “We are observing the latent demand, thanks to lockdown, through such enquiries. People are willing to get back to jewellery and I believe that the second quarter will have a bit of a rocky start, with the third quarter of 2021 seeming fantastic for jewellery sale,” said Kamath.

This is not just wishful thinking as the brand is working on the blueprint of their third showroom. “Planning for the showroom started with the lockdown immediately after the second wave. We are hopeful that the store will be active by the end of 2021,” maintained Kamath.

For Telangana and Andhra Pradesh though, one can open showrooms from 8am to 12 noon, as the curfew begins and continues till 6am. While that has allowed Vaibhav Jewellers to reopen stores, the response has not been overwhelming. Regardless, says brand director Keerthana, one can avail video shopping facility for safety and convenience. “Promoting offers on gold, diamond and fine jewellery has brought good response during lockdown,” she said.

Offline, plain gold jewellery is having a steeper demand curve than fine jewellery in-store. Operating stores at this delicate a time requires paramount importance to safety, which the brand is following.

“Besides allowing people with masks on, we have thermal screening, sanitization on doorstep and even provide gloves to people walking in who would want to touch and feel jewellery. Our staff handles jewellery with gloves and sanitization of exhibited jewellery, counters and swipe machines is mandatory post transaction. We are also sanitizing the showrooms every day,” said the director.

Despite building such a safety net for customers and sales team, the bleak customer sentiment has been yielding limited sales predominantly in gold and negligibly in precious and semi-precious categories. Jewellery buying is seasonal in these states, explained Keerthana, for which there was a big blow when Ugadi and Akshay Tritiya in 2021 didn’t turn out to be profitable at all. Keerthana believes that there will be negative impact in the first two quarters of 221 if brands are forced to operate for marginal hours of the day.

PMJ Jewels presents a different picture with 90% of its showrooms active in these two states. Managing director Dinesh Jain said, “In Andhra, showrooms were open from 7am-12noon, and for Telangana, they were open from 7am to 10am. After 31 May, showrooms in Telangana got a 1-hour-extension. Families who had wedding ceremonies postponed are showing great interest to complete necessary shopping chores. Some are even walking in at 7am!”

Jain attributes this unusual buying frenzy to the fear psychosis of Indian families who are stretching themselves to fulfil desires of elderlies, who are fatally prone to the virus unfortunately. Contrary to competitors, the brand has used e-commerce platforms aggressively to make up for the loss in in-store conversion because of lockdown. Also, the buying percentage among potential customers have gone up from 50-70% to 95-100% in both retail and online platforms. Online jewellery purchase continues unabated even in Karnataka and Tamil Nadu, where the brand has had its stores shut since lockdown.

Good times are ahead for progressive retailers, feels Jain, who has stopped promotionally campaigns at this time and is witnessing organic sale. According to him, there will be a lot of gold jewellery purchase because of chances of price rise, pre-poned bridal jewellery purchase and everyday jewellery sale for gifting. “August has a lot of occasions for wedding and so, we’ll see an uptick in bridal jewellery sale around that corner,” said Jain.

Central Indian retail paints a bleak picture

Lucknow, Gorakhpur and Varanasi are still under lockdown, although certain districts in Uttar Pradesh have earned their relaxation for having average infection rates lower than 600 per district. Raghav Rastogi, partner, Jugal Kishore Jewellers said that executing the format of an e-commerce platform through their website before the current lockdown has generated impressive sales enquiries and bookings.

“Sales all in all has taken a massive blow but we had predicted the second lockdown and so had made e-catalogues of our jewellery in store. Once lockdown began, we promoted those catalogues on social media and have since been accepting bookings whose delivery will be done once lockdown is lifted,” he said.

Catering to a predominantly rural economy, Rastogi said that customers have basically been inquiring about bridal jewellery only. A lot of weddings have been postponed to June, and that is what the brand is eyeing at for business revival. “There has been no leisure buying, but everything from necklaces to the gold silai are being inquired for in bridal category. People are also zeroing in on one brand that caters to all their demands,” he said. Although June-August has been the leanest for the industry, the retailer expressed concern over the shockingly slow inventory movement since this Akshay Tritiya and talks of the third wave incoming, which makes market prediction for future very hazy.

Madhya Pradesh too has variations in norms applicable. Vikas Kataria, chairman and MD, DP Abhushan Ltd., says that showrooms in Ujjain are enjoying more relaxations than in Ratlam. “No stores have been opened in Indore and Bhopal but we are allowed to operate our Rajasthan stores from 8am-10am. Within such a small frame, we are witnessing bridal jewellery sale mainly for those families who are holding their ceremonies with a strength of 25 guests or so,” said Kataria.

Wedding jewellery sale has taken precedence as buyers for everyday jewellery are holding back, waiting for the market to improve, said the retailer. Wedding dates are there till July, and couples whose marriage were postponed due to pandemic are buying now to get their ceremonies done without glitches.

Giving an interesting insight about how jewellery will return in demand, Kataria said, “The economy has seen a capital flow from basic necessities and lifestyle to healthcare and pharmaceutical industries. This money has to return to lifestyle, and fine jewellery takes centre stage in that demand curve. That is why the next two quarters will be very promising for the jewellery industry.” 

East India monitors slow market revival

Sawansukha JewellersPvt Ltd., Kolkata, West Bengal, is responding promptly to the slow but promising reopening of the market in this part of the country. “The current market response has been slow, as the showrooms are open for a shorter time span,” said managing director Siddarth Rupchand Sawansukha.

The entire economy was justrecovering from the first wave itself, with markets gradually opening up when the second wave kicked in. But people haven’t lost faith in jewellery in this part of the country as buyers are keeping purchases restricted to requirements such as bridal jewellery for the brand. This is why the brand has witnessed a surge in luxury jewellery sale.

“Consumers are very much inclined towards precious jewellery as they have halted small purchases,” said Sawansukha, adding that the impact of the second wave will be felt the most in the first two quarters of 2021. To make the purchasing experience safe and smooth, the brand is sanitizing the showrooms in every 2 hours. It is providing fresh caps, shoe covers, gloves and mandatory sanitization after each customer gets their temperatures checked before walking in. The brand has also launched the Sawansukha Virtual Store which allows buyers to browse jewellery from home and buy with the added facility of video call with brand executives.

North Indian jewellers adapting to tougher trade window

Managing partner of Bholasons Jewellers, Subhash Bhola underlined how the priorities of investment have changed with severe harm on the income of an average Indian professional. “With income severely reduced, wedding related expenses get the most attention. There are three types of Indian jewellery buyers, one being those who have gold to be gifted for upcoming weddings, the second being those wanting to buy wedding jewellery with existing bank balance and the third being the ones who depend on a steady income source to buy wedding jewellery. Those with the wherewithal are showing highest conversion, while for the rest are enquiring about wedding jewellery, lockdown relaxations across the country and purchasing thereafter,” he said.

All of this could happen only because of e-commerce platforms. Be it enquiry or sale, everybody is relying on those platforms to spot jewellery. Consumers in metropolitan cities, where the cases are high, are abiding by the law and waiting for the lockdown to cease. “Some restrictions have been lifted in Gurugram and we in New Delhi are hopeful about that in the next week,” said Bhola, adding that the situation is different in tier 2,3 cities where infection is lesser. “There, people are selecting jewellery online and even using influence to bring collections from the store to the potential customer’s place for sale. People are finding their ways to buy jewellery,” he maintained.

Buyers’ priorities have changed with options narrowing from all angles, as evident from the surprising in-store footfall Bhola witnessed a month or so back before the lockdown was to be imposed in Gurugram. At that time, buyers used to leave the showroom only after buying jewellery. This, Bhola said, was the result of the wedding expenditure plan Indian parents have been known for. “When they spotted an opportunity, they came only to close a transaction and not look for options elsewhere. Thus, I think that with varying safety rules, jewellery will find a way back to buyers in any format,” the retailer concluded his statement.

There will be teething issues across the country as state governments undertake trial and error tests to monitor the infection rates. Just as people prefer safety, they also want to get back to normalcy and the planned demand surge in wedding jewellery attests the fact. With the most progressive brands staying low on promotional campaigns, the stage is being set for a demand u-turn.

Written by Shubham Dasgupta

Latest News