Effect Of E-Commerce On Jewellery Industry
Retailers who wish to stay competitive in this vibrant market will need to step up their game to sell their inventory online and also increase footfalls to physical stores with the use of e-commerce and technology.
Photo Credit : Reuters
E-commerce is a huge platform which is growing at an unprecedented rate all over the world. People from every age whether they are children, millennials or old, love to shop from different e-stores. E-Commerce has become India’s fastest-growing and most exciting channel for commercial transactions. The Indian e-commerce market is expected to grow to $200 billion by 2026 from US$ 48.5billion as of 2018. This growth has been triggered as a result of increasing internet and smartphone penetration. The remarkable growth of Indian e-commerce has undeniably aided several industries. There is a growing appetite for international brands and better-quality products amongst digitally connected Indian shoppers due to rising income levels and increased awareness. Several categories such as lifestyle products, consumer electronics, clothing, footwear, jewellery and accessories, health and beauty, household goods, art and collectables, event tickets and online music are flourishing.
E-commerce has benefited the jewellery industry. Jewellery business which was once restricted to family-owned or proprietor-run entities is transforming by leaps and bounds and aligning itself with the advancing corporate culture and technology. There is a proliferation in the retail outlets and franchisee stores along with an increase in the presence of online players thanks to e-commerce websites and applications. Customers were buying a small ticket size of jewellery online. With the proliferation of e-commerce this ticket size has increased in the last 2 - 3 years and is expected to grow as the customer’s journey matures.
According to a study by McKinsey and Company, the share of the online jewellery market in Asia is set to double, from 6% to 12% by 2020. About 18% of the sales are expected to be made online by 2025 taking its worth to about $79 billion annually. Estimates indicate that this would make e-commerce the world’s third-largest luxury market, after China and the United States. This tremendous growth opportunity has led jewellery retailers rushing to establish a presence online and several newcomers flooding the space as well.
Emerging online jewellery businesses have empowered people in Tier II and Tier III cities to shop for a variety of jewellery like; gold, silver, diamond and platinum etc. at the click of a button. Convenient delivery options supported by a variety of payment options like cash on delivery and other advantages such as easy instalments and discounts have made jewellery shopping stress-free and enjoyable. Online jewellery platforms play a crucial role in influencing offline sales. Large ticket size jewellery above Rs. 1 Lakh is still sold in stores but customers first conduct thorough research before buying the jewellery online.
As more retailers in the jewellery segment realise the huge opportunity in the e-commerce sector, the market is set to become increasingly competitive. Consumer expectations are rising and they are not just looking for the best options but also a great shopping experience. Retailers who wish to stay competitive in this vibrant market will need to step up their game to sell their inventory online and also increase footfalls to physical stores with the use of e-commerce and technology.
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