Slump-hit Valentine Day: Young hearts prefer chocolates and flowers over jewellery
Valentine’s Day (V-Day) is one of the largest jewellery purchasing holidays of the year. According to the National Retail Federation, nearly 20 per cent of Valentine’s gift givers will buy jewellery.
According to a 2013 V-Day spending survey by the National Retail Federation, 19.7 per cent of consumers plan to buy jewellery on February 14. It also found that, jewellery ranks fifth behind regular staples like greeting cards, candy, flowers and an evening out.
Lovers go for gold on V-Day
10-years-ago, the only festivity that the jewellery brands were associated with was Dhanteras. However, the western trend of associating diamond and gold with the expression of love along with roses and cards was adopted all-over India by the youth.
While diamonds remain a girl’s ‘best friend’, the gold-loving country doesn’t mind giving the yellow metal a fair chance on the lovers’ day as well. Right from heart-shaped diamonds that can be fitted into a ring or a locket to light-weight pendants in geometric or floral patterns or delicate chains and bracelets – one is spoilt for choice. And then there are some traditional jewellers who have also designed special Valentine items in silver and costume jewellery for those who cannot afford gold but would still like to gift a special piece of jewellery to his Valentine.
“We have noticed a huge demand for gold jewellery during Valentine’s Day, albeit lightweight jewellery because the buyers are mostly young customers. So we have created a line of chains and bangles,” said Subir Sen of BC Sen.
The fact that A Sirkar has publicized its heart-shaped diamond on Facebook has naturally created a hype among young buyers and sales people are having a trying time managing the crowd. “We have a wide range of these diamonds from 14 cents to half carat to suit all pockets,” said an official of A Sirkar.
According to a survey by Associated Chambers of Commerce (ASSOCHAM), V-Day sales account for nearly 25% of business share for a luxury brand. It is a heavy buying festival that has seen significant jump over the past 5 years. They pointed that flowers, platinum or diamond jewellery and branded apparel were the most preferred gift items on V-Day.
Jewellery takes a backseat in 2014
However, due to economic downturn, the attitude of youth towards celebrating Valentine’s Day has changed. The economy seems to have taken its toll on love. Many young hearts are shying away from purchasing jewellery this Valentine’s season and instead are going for old favourites like chocolates and flowers.
Unlike last Valentine season growth in jewellery demand has plummeted to 5%-10%. On the contrary, florists are expecting a 50-60% growth in demand this Valentine’s season even though prices of roses have almost doubled. Even chocolate makers are expecting a 20% y-o-y growth.
Jewellery as a gift to the loved one is more of a recent trend. Generally, the young hearts favour diamond studded jewellery over plain gold jewellery to celebrate Valentine’s Day (V-Day).
This year, the overall jewellery demand growth has plummeted to anywhere between 5% and 10%. The jewellery market in India has been hit hard due to unavailability of the gold. The large-scale imports of finished jewellery pose threat to local jewellery manufacturing units.
According to the jewellers, there is hardly any demand for gold jewellery at the retail level. In fact, many gold jewellers had launched a wide range of new products at lower price bands to entice the customers. Delhi-based PC Jewellers has launched a new line of jewellery for V-Day. Balram Garg, managing director, PC Jewellers said: “We have launched a new range of product in the price range of as low as 3,000. Last quarter has been not encouraging for diamond jewellery. But we are hoping that during this Valentine’s season the demand will grow by 10% over last V-Day.”
But not many are as optimistic as Garg. Jewellers like Mehul Choksi, chairman of Gitanjali Group said that there is hardly any demand at the retail level. “Last year the V-Day period was very important for us. There was no supply crunch in the yellow metal. But this year the market is flat. The growth may be 5% or even less.
The reports suggest that retail jewellers are crucified on this V-Day unlike previous years as price rise whip the precious metal sector and cudgel hits young Indian’s income.
The demand for diamond studded jewellery too is not encouraging. Many jewellers fear the growth to fall to less than 5% this year. The market continued to remain flat on V-Day too.