A new report on ‘Retail Gold Insights: India Jewellery’ recently released by the World Gold Council (WGC) provides a comprehensive overview of consumer attitudes to gold jewellery in India and highlights some key issues for the industry to address if the popularity of the category has to be maintained going forward.

The report is based on a survey carried out across the globe, including in the three key markets of US, China and India, for WGC by global research agency, Hall & Partners in Q2 and Q3 2019.

The survey stresses that Indian women have a high affinity to gold jewellery -- 60% own it while 37% have not bought gold jewellery in the past but would consider buying it in the future, presenting a significant potential audience for retail jewellers to capture. Gold jewellery is the second most popular item among ‘fashion and lifestyle’ shoppers – preceded only by designer clothes/silk sarees, it states.

According to the findings of the survey, nearly 40% of those surveyed had bought gold jewellery in the preceding 12-month period, eclipsing purchases of diamond or platinum jewellery.

While urban women tend to focus on the sense of security that gold brings, highlighting its role as a display of wealth as well as a store of value, rural Indian women place greater emphasis on gold’s widespread acceptability and its aspirational qualities, viewing it as a means of commanding respect, the WGC said.

Thus, gold is seen as a purchase that has financial value and can be stored with ease, but it currently does not meet the significant needs for self-expression and prestige, key factors that motivate fashion and lifestyle buying.

Although many young women are active gold jewellery consumers (33% of Indian women aged 18-24 bought gold jewellery in the 12 months preceding the survey) their future purchase intent is low, particularly in the urban cohort. They are less emotionally connected to gold jewellery and this represents a potential future threat, the report points out.

Somasundaram PR, Managing Director, India, World Gold Council, commented, “India’s industry needs to be alert to the changing times. This research shows us that consumer tastes are evolving, and there is a risk of gold jewellery losing its connection with younger audiences as other brands vie for the attention of the millennial generation.”

WGC points out that gold jewellery is perceived as a traditional necessity and not versatile enough for the modern Indian women. This underlines the need to adapt, adjust and improve to meet the different needs of different groups of Indian women by establishing modern, relevant brands, that can resonate with consumers through compelling marketing campaigns.

Enhancing the purchase experience for consumers, incorporating a greater role for technology, should also be a focus for the industry, WGC said.

The report also highlighted some key barriers to future growth as market saturation: the perception that “we have enough of it”; lack of perceived fashionability: it does not “suit our style”; its close connect with traditional occasions that sometimes pushes women away from gold jewellery when they choose to shop for themselves; and the perceived difficulty in making a purchase.

Stressing that gold needs to diversify beyond its traditional stronghold and build fashion appeal, the WGC emphasises the need for innovation in design and in the buying experience. “The industry can learn to adapt to meet shoppers’ needs; it can modernise the ranges of gold jewellery it offers and fuse that offering with technology,” the report states.

Other important insights covered in the report are the profiles of jewellery buyers basis urban-rural divides, the sizeable gaps that exist, identification of demand moments, improvements and personalisation in purchase journeys, the potential of online channels, and other aspects crucial to lend a thrust to gold jewellery in India.

The study captured the opinions of more than 6,000 global high-end fashion and lifestyle consumers with at least 2,000 females aged 18 to 65 being surveyed in each of the largest gold jewellery markets: India, China and the US. All of them were ‘jewellery considerers’ – women who would consider buying jewellery and who had, during the 12 months preceding the survey, bought, gifted or received at least one from a defined list of high-end fashion and lifestyle products. In India, the respondents were drawn in almost equal proportion from urban and rural India.