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Demand for silver jewellery is expected to return to respectable levels following a year of pandemic-related disruptions that caused production to slide by 26 per cent to 148.6 million ounces (Moz) compared to 200.3 Moz in 2019, according to the World Silver Survey 2021.
The Silver Institute-commissioned report by Metals Focus foresees a 24 per cent increase in silver demand for jewellery manufacturing this year. Retailer restocking, easing Covid restrictions and an economic recovery were cited as the main factors driving growth in 2021.
The trade generally concurs, as export demand for silver jewellery rebounds and digital initiatives present new channels for sales and distribution. It helps too that silver lends itself well to current market trends such as online shopping, mask-friendly accessories and personalised, meaningful pieces as consumers rethink priorities amid the coronavirus crisis.
Silver jewellery exports are already up for Thailand, which registered a 6.7 per cent year-on-year jump in export value in the first quarter of 2021, according to Kittisak Udomdangaram, president of the Thai Silver Exporters Association.“
The value of Thai silver jewellery exports was already on the rise in the second half of 2020, on the back of stronger demand from the US and Europe,” he said. “Should global vaccination programmes progress smoothly, we can expect silver jewellery exports to increase even more this year.”
The US market is likewise delivering now for Indian silver jewellery manufacturer ACPL Exports.“
Similar to other major players in the silver jewellery industry, we were adversely affected by falling demand and uncertain economic conditions brought about by the Covid-19 pandemic. We tried to counter the slump by turning to the domestic market and focusing on digital marketing and online sales,” explained Abhishek Gupta, managing director of ACPL Exports.
PJ Design Ltd witnessed a slowdown in orders from chain stores in Europe, its main clients, from March to April 2020. Business returned to normal soon after when its customers shifted to online stores and e-commerce platforms, revealed Penniff Tso, managing director of the Hong Kong-based company.
US-based silver jewellery brand, Samuel B. Collection even managed to grow its business during the pandemic. Stimulus cheques boosted disposable incomes, which were diverted from travel to other luxury purchases such as jewellery, said brand founder and designer Samuel Behnam. The family-owned business also relied heavily on online and TV sales to sustain business momentum.“
In fact, we did amazingly well in several US states such as Texas and Florida that did not enforce lockdowns and allowed retail stores to continue to operate,” Behnam disclosed.
The Covid-19 pandemic underscored the need for businesses to respond quickly and smartly to changing market conditions. Digital adoption sped up in many sectors, silver jewellery included.
In export-oriented Thailand, online platforms allowed silver jewellery manufacturers to tap the domestic market during the pandemic and glean valuable insights on consumers' purchasing habits."
Social media and online channels threw silver jewellery manufacturers and exporters a lifeline during the pandemic-induced downturn,” remarked Udomdangaram, who is also managing director of Silver Bar Co Ltd. “Digital initiatives provide vast opportunities that we can harness in the new normal. Companies that can integrate online retail initiatives into their regular manufacturing and export business will be able to reduce cash-flow pressures and thrive during difficult times.”
Tso of PJ Design shared the sentiment, noting that the trend towards online stores and e-commerce is definitely here to stay."
Since the global economic and international travel situation remains uncertain, our business strategy will focus on further developing and expanding our online business. To help us achieve this objective, our latest collections are fancy, trendy jewellery pieces in lower price points. Enamel and fashionable silver items are our current bestsellers. We are seeing robust demand from Eastern Europe at present,” Tso said.
Samuel B. Collection's online sales has grown by 15 per cent on average during the pandemic. Aside from retail on its own platforms, the brand got a solid sales boost from third-party sites, said Behnam. Moving forward, he expects digital initiatives to contribute at least 25 per cent of the business.“
E-commerce, which gained traction during lockdowns, has become an important channel in the new normal. More consumers will shop online, expanding the market for silver jewellery,” added ACPL Exports’ Gupta.
Fundamental shifts in consumer demographics and priorities also work in silver’s favour. Gen Z consumers’ passion for sustainability, self-expression and values-based consumption bode well for the product category.“
Silver jewellery's designs, price points and versatility align with the priorities of this promising market segment, which already has a penchant for the white metal,” said Udomdangaram. The silver jewellery sector has a wide range of personalised and meaningful designs that would appeal to the values and sensibilities of the Gen Z market, he added.
ACPL Exports is training its sights on the younger generation of consumers as well.
According to Gupta, the company sees opportunities for growth in lightweight, slick and versatile designs that cater to this growing market force that has substantial disposable income to spare.“
Younger consumers, who have a greater affinity with sustainability and personalised products, will play a more significant role in shaping demand and jewellery design trends because of their growing importance in the e-commerce sphere,” Gupta noted.
The business outlook is relatively bright for the silver jewellery sector, despite current market conditions, according to Udomdangaram.“
Unlike other precious metals, silver allows for fashionable, trendy and affordable jewellery. It covers a wide range of prices, designs and occasions, from everyday wear to statement pieces. With its core competencies in craftsmanship, service and infrastructure, the Thai silver jewellery industry is well positioned to grow from strength to strength and meet the requirements of the ever-changing market in the new normal," he remarked.
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Source: JNA. This story originally appeared on JewelleryNet. Click here for more industry updates.