Jewellery segment in India post Covid-19
Before going to the future forecasts of the jewellery industry let us all know the current scenario of the jewellery market for both precious and non-precious industries.
How big is the current precious jewellery industry and how fast they are growing?
Currently, the market size of the precious jewellery industry stood at 80bn USD in the year 2020 and is expected to grow to 110bn USD by 2022.
To understand the numbers better let us compare them with the GDP of our country India.
The market size of Gems and Jewellery in India contributes to about 7% of the country’s GDP.
India’s total merchandise exports of these metals are equivalent to 16% of the total exports.
The compound annual growth rate of this industry stood at 14.8%.
Image Source: Investindia
How big is the current Non-precious jewellery industry and how fast it is growing?
From the past data that is available with the GOI market size of the non-precious jewellery industry is 4bn USD in 2019 and is expected to grow to 9bn USD by 2023 at a compound annual growth rate of 23.5%. (This is when COVID crisis is not taken into consideration).
The imitation Jewellery/ Non-precious Jewellery market is expected to grow further with soaring gold and silver prices, rising consumer preference, availability of more innovative designs and variety etc.
What are the main factors that are driving the growth in this Non-precious jewellery industry?
1) Drastic hike in the gold and silver prices is expected to be one of the major factors.
2) Consumer preferences are changing regarding jewellery as a daily wear commodity rather than an asset.
3) Affordability and availability of more designs are the other major factors that are driving the growth, as modern women prefer to change the jewellery based on their outfit.
4) Security is one of the biggest concerns for women when it comes to gold and diamonds. With low priced jewellery the risk of theft and robbery is minimal.
5) Change in trends and the affordability is the other factor which is not available with precious jewellery.
With the above factors taken into consideration, the current Non-precious Jewellery industry is growing at a rate of 85% year on year in India.
As researchers analysed the previous data of the industries and human behavior they found an interesting shift to the user behavior towards their buying pattern.
Customers will likely start spending less on the precious metals and will move towards the designer non-precious Jewellery. (There are various factors for the change in customers behavior)
From the existing data even if there is a 2% shift in the users buying pattern it will result in a 2bn increase in the Non-precious Jewellery industry market value, which will increase the current prediction from 9bn to 14bn industry in less than 3 years with the same YOY growth rate.