Precious stones and metals have always been status symbols. Over time, styles and trends have changed but the value of fine jewellery has increased. The emergence of e-retail has proved to be a game changer for traditional retail stores. Online shopping is now an everyday norm and is used by approximately 1.66 billion people. According to Bain & Company’s global luxury study, luxury goods alone accounted for US$1.2 trillion of sales, with shoes, bags and jewellery listed as areas with the fastest growth.
News that both Net-a-Porter and Farfetch have launched dedicated fine-jewellery sections means a major shift in buying behaviour of fine jewellery is expected in the future. This means that customers can browse for luxury jewellery brands as easily as a pair of shoes or new handbags and with a few clicks, these precious pieces can be purchased. While the apparel retail industry has made a shift to e-commerce platforms, individuals still contemplate purchasing fine jewellery online. In recent times, some jewellers have made the move to online platforms as part of their business expansion. Prerna Rajpal Founder of Amaris Jewels told LuxeBook, “I believe that using an e-commerce platform is an excellent opportunity for any emerging brand. It not only enables the brand to expand its reach to different regions but also provides valuable feedback on customer preferences. By leveraging this feedback, the brand can adjust its offerings in response to market dynamics.” However, a considerable section of the general population is still not open to normalising buying jewellery online. But what is the root cause of the issue? Is it the apprehension of quality or is it simply too expensive to purchase online?
*Fine jewellery denotes items made from metals such as gold, silver and platinum, and precious or semi-precious stones. Made in limited quantities, these often sell with a hefty price tag.
The challenge of buying fine jewellery online
As a category, fine jewellery is the opposite of fast fashion. Being considered an emotional purchase tied to a loved one or significant milestone, we hold it close with the intention of wearing it forever. It has however lagged behind other fashion retail categories in the digital space. According to reports, currently, the purchase of fine jewellery online is less than one per cent in the country and the advantages of purchasing jewellery from physical stores continue to lure customers.
Traditionally, people buy jewellery items from offline stores where they can touch, feel and try the jewellery before making any purchasing decisions. Seeing the design, touching the material, and feeling the item on your skin are inseparable components of jewellery shopping and people cherish these experiences associated with offline jewellery shopping. Agreeing with this, Rohan Sharma Managing Director at RK Jewellers, in Delhi highlighted the importance of tactile senses in encouraging sales. ” People typically purchase jewellery from offline stores where they can touch, feel, and try the jewellery on before deciding on a sale. People treasure the experiences connected with offline jewellery purchases since they involve seeing the design, feeling material, and experiencing the piece on their skin. A jeweller gives their customers the opportunity to try on the jewellery in person, giving them the confidence to buy from them or from anyone else they may choose from.”
A tactile sensation
However, websites and platforms don’t allow for such interaction with the product before purchase. The user is unable to try the product to see how it looks or feel it to assess the quality and hence the customer may feel unsafe and unsure about what they are buying. Even though modern online jewellery sellers are trying to bridge this gap through virtual routes, it isn’t the same. The touch of reality is still at a distance from online jewellery shopping. Of all items, jewellery is perhaps the most emotionally charged. It is also loaded with meaning and linked to relationships – through engagement and wedding jewellery, or heirloom pieces passed over generations, jewellery is purchased as a custom during significant moments in one’s life. It is a marker of financial independence, such as investing in gold, or a woman buying her first serious diamond, and is more likely to be handed down as a family heirloom, compared to clothing or bags. The crux remains that buying ornaments offline involves prolonged customer engagement, which online platforms don’t allow. “In our industry, customers who have the option to visit a physical store still prefer to do so, as they value the opportunity to personally examine and experience the products before making a purchase,” feels Rajpal. It is safe to say then that brands need to come up with a mechanism -blending technology in the procedure to allow people to interact with the product in a better way through online mediums.
The online fine jewellery industry in India
With the pace of digital transformation, there is no way we can avoid jewellery e-commerce. The Indian jewellery industry has witnessed immense growth in the online retail jewellery business. Many big players in the industry introduced their online business models during the pandemic and onwards. They adopted digitalization through a multi–channel approach. According to a recent report by My Wisdom Lane, the Indian online jewellery market is projected to grow to $3.7 Billion by 2025, at a CAGR of 28%. The report also said the Indian online Jewellery market has the potential to reach up to 10% of the overall Indian Jewellery market. According to Rajpal, there is a growing trend of consumers embracing online purchases of high-end jewellery, especially internationally, which has been accelerated by the COVID-19 pandemic. She says, “People appreciate the ease and comfort of shopping from home, and they are becoming more confident in buying luxury items online from trusted brands. For instance, our website has enabled us to establish a loyal customer base across various regions, including the US, Canada, UK, UAE, and Australia.”
Augmented and virtual reality
With the digital world gaining prominence, jewellers are also ready to take on a new challenge. Sharma believes online platforms can provide a wider range of products and it also utilises time in an efficient manner. “The internet has completely transformed how we shop and reduced everything to a simple search-and-click. When purchasing jewellery online, you have access to a wealth of expertise, professional insight, consumer testimonials, store ratings, and more. You no longer have to rely on salespeople and attention-grabbing billboards that merchants post in-store.”
Few Indian startups and many big retail players have started using new-age technologies such as augmented reality and virtual reality to create the best user experience. Milind Mathur Creative Director & Partner, Kohinoor Jewellers points out the use of 3D models for online purchases as well. He highlights that many a time, customers can view a digital 3D model before purchasing the piece. That brings them context, and an experience closer to an offline purchase experience But he also believes that “When it comes to buying jewellery, a product that is precious by nature and typically has intricate design features, the online influence on offline retail becomes even more substantial and decisive. Because of this, individuals continue to purchase jewellery from their preferred jewellery retail store relying on the touch-and-feel factor.” E-catalogues, 360-degree views of products and virtual try-on have made a huge impact on the Indian online jewellery market because it is very important for a brand with an online presence to create the trust factor. While adequate knowledge about jewellery and certification has helped consumers, Sharma shares an insightful perspective, “Online jewellers are aware of the value of clarity. You can learn more about craftsmanship, metal purity, carat weight, gem quality, and other topics. Genuine grading certifications from reputable gemmology labs like GIA, AGL, and others are readily available from online vendors. In order to aid their clients in selecting the ideal product, sellers offer a wealth of information.”
Are prices getting more competitive?
A key point that deserves conversation is the price points involved in online sales. One is aware of the benefits of an e-commerce marketplace when it comes to cutting costs as opposed to a retail store. So, does that mean prices ought to be more competitive? “I don’t believe that an emerging brand should resort to aggressive pricing just because the e-commerce space is crowded. It’s crucial to set reasonable prices for your products. Nowadays, customers are knowledgeable and have access to numerous alternatives. In order to attract and maintain customers, it’s essential to establish trust, and fair pricing plays a crucial role in achieving this goal,” believes Rajpal. Adding further Harshad R Ajoomal, Creative Director and Founder of House of Ajoomal said, “I feel one can still compete in the market if they don’t deteriorate the quality of their product for which the client is ready to pay a slightly higher price if they feel your design and quality standards are better than the competition. Therefore, one must continuously upgrade their styles to ensure they are relevant for today’s modern women.”
On the contrary, Sharma is of the opinion that given the price difference between online and in-person rates, it is inevitable that some customers will inquire about the web price when they visit a store. Hence, given the emergence of Internet businesses, there is a demand for competitive prices. Pawan Gupta, Director, PP Jewellers by Pawan Gupta says, “There is certainly pressure for competitive prices in the retail industry, particularly in light of the rise in online stores. Online retailers often have lower overhead costs compared to brick-and-mortar stores, which can allow them to offer lower prices and discounts to consumers.” Gupta also points out that online stores have made it easier for consumers to compare prices across different retailers, which can further drive competition and pressure retailers to offer competitive pricing. “However, it’s worth noting that not all consumers prioritize price above all else when making purchasing decisions. Many consumers are willing to pay a premium for high-quality, unique, or personalized products, even if they could find similar items at lower prices elsewhere.”
While the online industry is booming and seems to have its perks, it’s still a territory majority are not completely comfortable with. Despite the convenience and seamless buying experience, there are certain categories of people who hesitate to buy online. Precious jewellery falls in a tactile category which means people prefer to touch and try on them before making a purchase. However, the idea of using technology in the distribution of jewellery is in the early stages, and there will be lots of innovative products in this space that may eventually lead to a boom in online sales. But the bottom line remains that offline and online retail go hand-in-hand. While the former boosts sales, the latter garners a new audience. Many a times customers visit stores to get a feel of the product only to purchase it online.
Gupta says the rise of online stores has had an impact on brick-and-mortar retail stores, but the extent to which retail stores are suffering varies depending on several factors. “On one hand, the convenience and ease of online shopping have led to a decline in foot traffic to physical stores, particularly in certain categories like electronics, clothing, and home goods. In addition, the COVID-19 pandemic has accelerated the shift towards online shopping, as consumers have been hesitant to visit physical stores in person. However, brick-and-mortar stores still play an important role in the retail industry.” To conclude he is of the opinion that while traditional brick-and-mortar stores still play an important role in the retail industry, online shopping can provide an extra consumer conversion and has become an increasingly important channel for retailers to reach consumers.
Hence, it wouldn’t be incorrect to say that the future belongs to omnichannel jewellers who can provide a seamless shopping experience across multiple channels. Jewellers need to gradually build their omnichannel capabilities by leveraging the reach, flexibility, and scalability of online retail along with the personalized customer relationship and profitability of offline retail.