(PRESS RELEASE) HONG KONG – Despite a challenging start to the year, Platinum Guild International (PGI) reports positive signs of recovery in platinum jewelry markets in Q2. The pandemic accelerated the need for change across an industry that has been slow to evolve, however current metal prices continue to position platinum favorably giving industry partners time to mobilize and innovate. The latest Platinum Jewellery Business Review (PJBR) Q2 2020 indicates that industry players are seeing demand for platinum jewelry gradually return and growing interests of consumers in new designs and collections.
“The report shows that markets are starting to recover in mainland China and consumers may be willing to spend on jewelry post-COVID-19. With the restrictions on traveling and spending on experiences, this gives platinum jewelry an opportunity to gain a larger share of discretionary purchase if manufacturers and retailers continue to prioritize new collections and design directions to meet changing consumer needs for meaning and value,” says Huw Daniel, CEO of PGI.
USA
The gross domestic product had the worst fall in modern history caused by the sudden halt of economic activities. Jewellers were struggling in the first half of Q2, but business started to recover in June after lockdown measures were eased.
However, retailers have had to accelerate their omni-channel experience for their customers in order for their business to survive and for long-term success. One of the consequences of the pandemic is consolidation, weaker stores will close, but the remaining retailers will be stronger, better-managed businesses. While it will be a challenging road ahead until an effective COVID-19 vaccine is introduced, there could be a strong rebound in Q4 with the industry benefiting from a strong bridal season if the pandemic remains under control.
China
In Q2, the gross domestic product grew, showing an impressive post-COVID-19 recovery. The decline of jewelry sales eased after lockdown measures were lifted in most cities and industry partners started reporting a platinum recovery driven by competitive pricing and the launch of new products which utilize innovative new technologies and designs that engage a new generation of consumers. PGI’s initiatives in China to engage with both the jewelry trade and consumers were proven extremely effective in accelerating recovery during post-COVID-19 with a +1% year-on-year growth in platinum jewelry fabrication.
Japan
Despite overall weak jewelry sales in Japan, platinum was the best performer, supported by competitive prices of high-end jewelry and bridal demand. Seen as a metal that retains its value, sales of platinum jewelry in some contemporary chains picked up in June despite no tourists, non-store sales were taking share from overall jewelry sales during the national lockdown and the “New Me, Platinum” TV shopping initiative targeting affluent, mature consumers achieved encouraging sales in spite of the pandemic.
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India
Store traffic and consumer demand dropped significantly as most of the jewelry business were closed in the majority of Q2. However, the PJBR reveals that once business resumes, platinum jewelry is likely to benefit from retailers’ focus on high margin categories and conversion of gold customers to optimize return.
As consumers around the world are putting more importance on family and meaningful moments in their lives, PGI is focusing on initiatives involving digital marketing and sales conversion that focus on creating meaning in order to capture discretionary spending.
“In an unexpected turn of events, the high price of gold has made platinum more attractive for jewelers. We see partners seizing this opportunity through restocking and increasing platinum fabrication to launch meaningful collections. However, jewelers also need support by upgrading omni-channel strategies to better meet the consumers desire to see products inside the store while continuing to engage customers proactively through digital channels to enhance consumer identification and conversion,” says Zhenzhen Liu, director of global corporate marketing, PGI.
