Jeweller - October 2023

Go Gold | PRECIOUS METALS
SOURCES OF GOLD DEMAND - WORLD GOLD COUNCIL
When is it a good time to buy gold in Australia?
There is often a misconception that positive economic growth
is bad for gold. The recent inflation figures from both the
RBA (4.9 per cent), and the Fed (3 per cent), as well as other
major economies has been encouraging.
Consumer Price Indices (CPI) appear to be moving in the
right direction. Should this continue, there may be talk
around the potential of rates decreasing to help kickstart
local economies, and thereby enhance consumer spending.
As almost half (44 per cent) of gold’s demand originates from
the jewellery and technology sectors, economic improvement
generally results in increased appetite for such items. This
is where regional demand tailwinds are relevant. Consumer
demand, while global, is heavily weighted towards China and
India who account for more than half of jewellery demand.
INVESTMENT
38%
Bundling?
Bundling is a method to direct attention to specific products within your
store. If your gold jewellery sales need to improve, consider bundling as
a strategy to boost performance.
A gold necklace, a pair of earrings, and a bracelet can be displayed
together as a set.
This encourages customers to visualise themselves wearing each
product together as part of a ‘complete’ look.
This is a powerful tool for upselling for jewellery retailers – encouraging
customers to purchase multiple items rather than a ‘one off’ piece.
Given recent changes in consumer patterns, this is an important
concept to consider. Romil Patel owns Fiji Jewels and oversees the
operations of four jewellery stores.
“We’ve seen a shift in consumer patterns in our stores. I think there’s
a new approach to fashion, particularly among younger women,”
he tells Jeweller.
“I think the younger generation is conscious of the ‘complete package’.
When it comes to outfits, they want every accessory to complement the
others. There’s also a strong desire to avoid repeating outfits.
“When you’re frequently purchasing an entirely new ‘look’, the costs can
quickly add up, and that’s why I think there’s a move away from precious
gemstones and precious metals towards fashion jewellery.”
"Gold jewellery is unique because of the warmth and richness
of colour it displays - and the lighting in your store should
capatilise on these characteristics. Don't hold your gold
jewellery in some dark corner! "
TECH
7%
JEWELLERY
37%
CENTRAL BANKS
18%
Based on 10-year average annual net demand estimates ending in 2022. Includes: Jewellery
and technology net recycling, in addition to bars and coins, ETFs and central bank demand
which are historically reported on a net basis. It excludes over-the-counter demand owing to
limitations in data availability. Net jewellery and technology demand computed assuming 90
per cent of annual recycling comes from jewellery and 10 per cent from technology.
Sources: Metals Focus, Refinitiv GFMS; World Gold Council; Gold Hub
Patel suggests that jewellers should be mindful of this new consumer
mindset and its impact on personal budgets when considering what
products they stock.
“A beautiful set of diamond studs can match any outfit, but I think
people are still looking for more flash and style,” he says.
“With metal prices the way they are, younger customers would instead
get multiple colourful items than purchase one exceptional piece of
fine jewellery.
“As a jeweller, that doesn’t mean you need to reduce yourself to selling
very cheap products; it’s about finding a healthy balance in the middle.”
Relationship building with education
Now more than ever, consumers are looking for an educational
experience when dealing with businesses and offering essential insights
is vital to exchanges with customers.
This phenomenon is not just limited to gold jewellery sales; even for
casual observers, jewellery and gemmology can be a fascinating field.
It’s important to remember that just because you may be knowledgeable
about the topic doesn’t mean your customers are.
While educating customers on topics like the state of the industry or
the history of jewellery can be a time-intensive investment, it’s a
valuable avenue for increasing rapport and improving the likelihood of
repeat business.
Recent research has suggested that consumers are more likely to
purchase from a business or brand if they engage with ‘early-stage’
educational content.
46 | October 2023