E-commerce Strategies for the Jewellery Industry

Marketing and Advertising in E-commerce

“Time travels faster as you get older”. This has never been more true than in the past 30 years- since the boom of the IT industry. Technology has so drastically changed our world that it is now virtually unrecognisable from a quarter decade ago. Technology literacy is at an all-time high across all age groups. People are becoming lazier and lazier. Some might argue or even blame technology for this laziness pandemic. This as a result has made people demand better, faster and more efficient service from businesses. As industry flourishes, demand for quality and competition for pricing has also been increasing. So, how do old-school retailers keep up with this current flow? It’s not about stocking and selling a set number of products to the same customers over and over again. Expansion is of paramount importance, even for survival. The singular, value-for-money, most sought-after mantra for retail expansion is through e-commerce. Back in the olden days, expansion meant putting up another shop or store in a different area- now things have changed. You can target different areas and different cadres of people by leveraging the e-commerce card.

How would e-commerce play out in the jewellery industry? Would it offer any advantages to the seller over other sellers? Is it necessary even for survival in the long term? That is what we are here to discuss in this study. Extrinsic market research and analysis have been conducted to draw upcoming inferences and conclusions. Let’s dive in!

The Jewellery market in India targets two industries in specific- the commodities industry and the fashion industry. Ownership of gold in our country is also often considered a parameter for social status- therefore making branding necessary as that contributes to status as well. It is imperative that we do not underestimate the role of branding in the jewellery industry. This involves a bit of understanding of human psychology at the macro level, and how our collective societal minds work. As we saw before, gold or any jewellery for that matter is a symbol of social status. We can see this phenomenon all around us. There’s a status difference when driving an Audi and an Alto. The name we give this supposed difference in status and quality is ‘brand’. The ‘brand’ is very important as we go higher and higher up the luxury ladder. Within the fashion industry itself, jewellery is something that branches into the luxury sector. And as explained earlier, branding is very important when it comes to luxury products, and as an extension, very important to the jewellery industry as well. In the current retail industry, the most effective way to brand yourself is through an e-commerce platform. Let us further look into how the industry works and how deep people’s minds go when buying jewellery.

One thing we need to understand is, this industry as a whole does not have to sell itself to its potential customers- people will keep buying jewellery. People who buy will buy- the only variable is from who. It’s important to understand how their minds work when they do this. Most people often think that they’re actually investing their money and also getting a high-end status control product in return. This makes jewellery a high-margin product in an expanding market.

To understand the need for an e-commerce wing for your jewellery store- you must first understand the advantages of having an e-commerce presence. Of all the advantages, two are the most relevant to our conundrum. Firstly, an e-commerce presence acts as a form of advertisement that can draw more customers to your store. Secondly, and this is the most important, you can collect data! Data collection is very essential as you better understand what the market wants. When you refine your products to the market’s needs you increase the brand and quality value of your firm- this will give you an edge over your competitors.

Data collection and using that data to better refine and adjust your products to the market’s needs seem to be the key to getting a bigger portion of the market- both domestic and international. Now let us break this down systematically and connect the dots:

          1. Focusing on data collection enables you to understand the market's needs.

      2. Customising your collection using the collected data helps with your brand image to new potential customers and helps showcase your premium skill in designer jewellery.

         3. This as a result draws more customers into the store.

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. Footfall is also another important factor to consider. The most fundamental law of B2C businesses that we all need to understand is “The first step to selling a product is to first get the customer inside the store”. This quote underlines the importance of marketing and advertising. What does e-commerce have to do with advertising?

Advertising has been changing so dynamically in the past 70 years- ranging from people spinning name boards outside stores to offering services and products with zero profits. An e-commerce website does precisely that- it shows prospective customers what the store is offering in a detailed product-oriented fashion. This way the viewers are not only tempted to pay a visit to the store, but they will also know what they want. This triggers a flywheel effect. If customers know what it is they want, they communicate better and to the point to stores and companies, this in effect helps stores better understand what the customer is looking for and what the market wants.Therefore this goes hand-in-hand with data collection- except this data is direct feedback from customers themselves. This also helps with inventory management. A store can throw in way more options and products on its e-commerce platform but does not necessarily have to stock them. Based on the orders they receive they can produce it concurrently.

Another thing the Indian jewellery industry has a spotlight on is the International market. You do not necessarily have to have a physical international presence for overseas market share- thanks to the all-new fast fashion and online fashion industry, people have gotten into the habit of ordering clothes online and just returning them if they do not like them. The same goes with jewellery, it’s about getting orders and getting your name out there. If people don’t like what they ordered, they are just going to return it. Online fashion is no longer just about fashion and offering the best style- it’s about offering more selections and having strong logistical support. The big players in the jewellery industry understand this very well- they all have top-of-the-line website applications that are data-centric and are also working on their logistical base for their international share of the market.

Now before we delve into the international market directly, let us first see if there is an international market for Indian jewellery and if there is, how big it is. Is it worth investing a hefty amount and pouring efforts into logistics? What are the different types of markets in different countries for Indian jewellery?

One must first understand the macroeconomic standpoint of our country in terms of opportunities and graduation rates. India, at the moment, does not have a huge technology or IT industry like the west does, but at the same time, it has been producing graduates at an unprecedented rate for the past 20-25 years. This means there is a supply-demand disparity in IT and other high-paying jobs. Naturally, Indian degree holders have nowhere to go but abroad where the disparity is the other way around. Therefore, immigration rates are extremely high in our country. Almost every second or third household in metropolitan cities has people in the States or the United Kingdom working an IT or a finance job. India had the largest diaspora population in the world with 18 million people from the country living outside their homeland in 2020, according to a report by the United Nations.

As you can see, the number of Indians in the United States has doubled in the past 20 years. And we’re not talking about Indians who need to make ends meet, we’re talking about ones that have money to burn. And the most important point to note is that, until an immigrant obtains a green card, he/she cannot own properties or run businesses in the country - this essentially means immigrant Indians have money sitting around looking for investments. Can we tap this opportunity? Is it possible to make this target population buy jewellery in the name of investing? To answer that we first need to understand the amount of importance and emphasis Indians give precious metals in their investment portfolio. Let’s look at some statistics.

Indian women alone own an estimated 11% of all the gold in the world. Now, it’s like putting two and two together. A huge number of well-earning Indians immigrate. Indians like gold- be it for investing or social status. The singular inference you can draw from the above two statistical facts is that there is a huge foreign market for Indian jewellery.

An e-commerce presence will take the geography parameter out of the equation. A store with an e-commerce platform will make it omnipresent all over the world. As mentioned earlier, export has to be the next step in the grand scheme of expansion. It might sound like a big deal but we need to understand, technology has changed, and transportation isn’t as difficult as it once used to be. Even small-time jewellery stores have either started or begun planning their export campaign.

Even the small players in the industry are starting to understand this. Many small-time jewellery stores are starting to invest heavily on e-commerce and digital marketing. There are several hallmark examples who’ve seen great success through their e-commerce platform. Time and time again, e-commerce has been capturing different segments in the retail industry. It’s only a matter of time before jewellery becomes another one of the dominoes to fall.