Despite a challenging start to the year, global platinum authority Platinum Guild International (PGI) reports that there have been positive signs of recovery in platinum jewellery markets in the second quarter of this year.

The pandemic accelerated the need for change across an industry that has been slow to evolve; however, current metal prices continue to position platinum favourably, giving industry partners time to mobilise and innovate, the organisation says.

The latest 'Platinum Jewellery Business Review (PJBR)' for the second quarter indicates that industry players are seeing demand for platinum jewellery gradually return, while interest among consumers in new designs and collections is growing.

“The report shows that markets are starting to recover in mainland China and consumers may be willing to spend on jewellery post-Covid-19.

"With the restrictions on travelling and spending on experiences, this gives platinum jewellery an opportunity to gain a larger share of discretionary purchase if manufacturers and retailers continue to prioritise new collections and design directions to meet changing consumer needs for meaning and value,” says PGI CEO Huw Daniel.

CHINA

China's gross domestic product (GDP) expanded in the second quarter, showing a considerable post-Covid-19 recovery.

The decline in jewellery sales eased after lockdown measures were lifted in most cities and industry partners started reporting a platinum recovery driven by competitive pricing and the launch of new products that use new technologies and designs and that engage a new generation of consumers.

PGI’s initiatives in China to engage with both the jewellery trade and consumers were proven "extremely effective" in accelerating recovery during post-Covid-19 with a 1% year-on-year growth in platinum jewellery fabrication, the organisation notes.

US

In the US, GDP had the worst fall in modern history, caused by the sudden halt of economic activities.

Jewellers were struggling in the first half of the quarter, but business started to recover in June after lockdown measures were eased.

However, retailers have had to accelerate their omnichannel experience for their customers for their business to survive and for long-term success.

One of the consequences of the pandemic is consolidation - weaker stores will close, but the remaining retailers will be stronger, better managed businesses, says PGI.

While it will be a challenging road ahead until an effective Covid-19 vaccine is introduced, there could be a strong rebound in the fourth quarter with the industry benefiting from a strong bridal season if the pandemic remains under control.

JAPAN

Despite overall weak jewellery sales in Japan, platinum was the best performer, supported by competitive prices of high-end jewellery and bridal demand.

Seen as a metal that retains its value, sales of platinum jewellery in some contemporary chains picked up in June. Despite no tourists, non-store sales were taking share from overall jewellery sales during the national lockdown and the “New Me, Platinum” television shopping initiative targeting affluent, mature consumers achieved encouraging sales in spite of the pandemic, notes PGI.

INDIA

Store traffic and consumer demand dropped significantly as most jewellery businesses were closed in the majority of the second quarter.

However, the PJBR reveals that, once business resumes, platinum jewellery is likely to benefit from retailers’ focus on high-margin categories and conversion of gold customers to optimise return.

As consumers around the world are putting more importance on family and meaningful moments in their lives, PGI is focusing on initiatives involving digital marketing and sales conversion that focus on creating meaning to capture discretionary spending.