Platinum sustains momentum for industry recovery and growth
Platinum jewellery has created a strong platform for continued growth in the post-pandemic era by focusing on meaningful relationships and significant moments, according to the Platinum Guild International (PGI).
PGI’s Platinum Jewellery Business Review (PJBR) 2021 found that jewellery retailers and manufacturers in key markets deployed platinum in their recovery efforts last year, deftly expanding platinum’s customer base to increase margins and profitability.
"At PGI, the challenger mindset is central to an approach that has enabled platinum to punch above its weight in a jewellery category dominated by gold and diamonds. From the outset, we approached the pandemic as an opportunity for platinum to be a key driver of the industry’s recovery efforts. Platinum’s unique story and contribution to industry margins and profitability made it a natural to lead industry recovery as consumers returned to stores," said Huw Daniel, CEO of PGI.
PGI predicts platinum will have a K-shaped outlook this year. Active players who invest now will be able to gain market share rather inexpensively, it noted.
Platinum jewellery retail sales in the US rose 3.4 per cent year on year in 2020. PGI received a significant increase in requests for support from retailers pivoting to platinum from white gold to capitalise on the more accessible platinum price. Bridal and diamond fashion jewellery set in platinum performed well in the market.
In Japan, the world’s most mature platinum jewellery market, business was relatively sustained with platinum jewellery retail sales dipping just 10 per cent year on year.
PGI and its industry partners tapped younger Japanese consumers with the Platinum Woman collection-based marketing initiative, which positions platinum as the metal that reflects their lives and aspirations.
In China, PGI retail partner sales declined by 11 per cent year on year. Leading retail chains drove growth in the second half of 2020, shifting their focus to platinum while expanding into lower-tier cities.
PGI launched “Reboot,” a province-by-province initiative to drive re-stocking of new products accompanied by large-scale sales activation. The programme fast-tracked the distribution of more contemporary designs curated by PGI coupled with omnichannel sales events to increase store traffic and conversion. It covered 1,277 retail stores and reached 13 million consumers, delivering positive results with year-on-year sales increasing over 40 per cent.
Meanwhile, PGI retail partners in India saw an overall year-on-year contraction of 36 per cent in 2020. PGI strove to maintain platinum’s top of mind awareness, empathy and relevance leading up to a full-blown recovery programme in Q4, the PJBR noted.
PGI India initiated the "Season of Hope" programme to encourage consumers to return to stores. Participating retail partners across 300 cities reported a staggering 33 per cent year-on-year increase in platinum jewellery sales during the promotional period.
Consumer demand has however since stalled as India battles a severe second wave of Covid-19.