Jewellery brands have high hopes from festive season, to spend big on digital

The slowing economy, higher gold prices and low consumer sentiment are not dashing the high hopes of jewellery brands from the upcoming festive and wedding seasons.

To attract consumers, brands are lining up major ad campaigns with special focus on digital and TV. The campaign budgets have also been increased, as compared to last year.

The next four months constitute of major chunk of sales for jewellery brands and the organised sector hopes that despite a downturn in the economy, growth will continue in the sector this season. 

MP Ahammed

“The jewellery demand usually strengthens in the last quarter of a calendar year due to festivals such as Dussehra, Diwali and wedding season. In the run-up to the most anticipated phase, the gradual increase in demand at the consumer end is quite encouraging for us,” said MP Ahammed, Chairman, Malabar Gold & Diamonds.

“The consumer sentiment might have been taken a hit slightly because of higher gold prices. I think people are slowing getting used to the new price points of the yellow metal. As we go forward, demand for jewellery will surely increase,” he added.

Shrenik Gandhi

According to Shrenik Gandhi, CEO, White Rivers Media, some of the leading brands in the industry are keeping aside almost 40% of their total adex of next four months for digital.

"In three months of the festive season, 40% spends of jewellery brands go to digital. In the jewellery segment, the festive season is followed by the marriage season. In the next four months, the jewellery brands will spend 45-50% on digital medium. The focus on digital marketing will only be for brand awareness," Gandhi said.

White Rivers Media manages three leading jewellery brands.

Ahammed of Malabar also believes digital and social media will play a major role in getting consumers to buy. 

“Jewellery as a product category will continue to face competition from other categories such as consumer durables, luxury categories and curated travel plans. So, how competitive the edge of the jewellery category would be over other categories will depend on how intelligently, innovatively and strategically jewellers leverage the power of the digital medium and social media to capture consumers early in their purchase journey,” he added.

Ahammed said the brand, at the same time, will keep its focus on TV advertising as it is the largest medium in the country. Malabar has celebrities such as Kareena Kapoor, Manushi Chillar, Tamannaah Bhatia and Anil Kapoor as its brand ambassadors.

“In my view, India’s never ending love for gold would always keep the demand up. No matter what the price or economic condition is,” Ahammed added.

A CXO from another leading jewellery brand told BestMediaInfo.com that the auspiciousness attached to buying of gold, the cultural roots of India and the increasing trust in the organised sector would never let the gold demand fall. At the same time, lightweight jewellery and other products such as diamonds and platinum would also see growth.  

However, the optimism does not mean brands aren’t launching attractive schemes to lure consumers.

Discounts will attract price-sensitive customers whereas the old jewellery exchange scheme will keep the consumer purchase cycle going, said another brand.

Malabar to open 750 stores, eyes Rs 50,000 crore revenue

Ahammed said Malabar is embarking on an expansion-spree and will open 750 outlets in the next five years with an annual turnover exceeding $6.16 billion (Rs 45,000 crore) and the group turnover at $6.85 billion (Rs 50,000 crore) by 2023.

The brand’s ad-spend should commensurate with such massive vision as well, he said.  He said jewellery players will invest more on research and analysis in the next few years.  

“From the category point of view, competition is always a key growth driver of ad-spend. As jewellery will vie for the consumer wallet along with other product categories in the upcoming festive season, the overall ad-spend will witness an uptick. Having said that, I think progressive jewellery retail players will invest more in research and analysis to unearth new consumer insights to add value to their marketing and promotional campaigns,” Ahammed said.

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