Q: With gold prices reaching record highs, how are consumer preferences evolving in terms of jewellery design, caratage, and purchasing behaviour?

A: The momentum of gold has been exceptionally strong in 2025, with prices repeatedly hitting new highs, 13 so far this year (and 40 highs in 2024), including crossing the psychological threshold of $3,000/oz and Rs 90,000/10grams. This performance has been replicated across major currencies, and is driven by economic trends and sustained investment demand. 

Geopolitical and economic uncertainty, a weaker US dollar, lowering of interest rates across economies, and inflation concerns are fuelling investment demand, and influencing prices. Record high prices have dented jewellery demand, with buying being restricted to need-based purchases, primarily for weddings. 

Additionally, the financial year-end dynamics, which include statutory payments and tax-saving investments, are also curtailing discretionary spending, further weighing on demand. This slowdown is broad-based across regions – urban and rural areas. Market reports indicate that consumers continue to wait on the sidelines for a correction in prices, or at least signs of price stability. 

On the other hand, notwithstanding an easing in momentum, investment demand, that is, for bars and coins, remains relatively healthy, driven by bullish sentiments regarding the future trajectory of gold prices. 

In addition, the surge in gold prices has been prompting the sale of old gold jewellery. Retailers have reported a significant uptick in scrap or old gold sales, with some attributing up to a third of their sales to the exchange of old jewellery for newer, lighter pieces. Furthermore, there has been a rise in loans against gold jewellery. Retail gold loans by commercial banks have risen by 77% y/y, as of January 2025. This indicates the consumers are increasingly leveraging gold for liquidity and financial gains. 

 There is a growing expectation that seasonal factors (auspicious days and festivals) and wedding-related purchases could lend support to gold demand in the next couple of months, including investment demand. This, however, may not fully compensate for the price-driven constraints in overall demand. 

Q: The Indian gold jewellery market has seen a shift towards more organized retail, with chain stores increasing their market share to 35% in recent years.  What factors do you believe have contributed to this trend, and how is it impacting traditional independent jewellers?

A: The transformation of the Indian gold jewellery market to an organized retail market is majorly fuelled by new-gen buyers, as they favour the entire buying experience that branded retail channels offer for purchasing jewellery. This inclination is majorly influenced by the fact that there is an assurance of purity and quality that the retail chain stores offer. While organized retail share has grown, traditional independent jewellers have also attempted to match the high standards and experience offered by the organized market. 

Q: Given the increasing interest in digital gold investments and gold-backed financial products, what strategies should traditional jewellers adopt to integrate these trends so as to appeal to tech-savvy consumers?

A: Digital gold has become quite popular with young tech-savvy Indian consumers. It has given the most reliable access to over 80 million small and micro investors in India (especially from rural and semi-urban areas) to invest in gold. Traditional jewellers can capitalize on this, and attract these tech-savvy consumers by embracing digital gold in exchange for gold jewellery. This increases fungibility, and will allow jewellers to embrace digital gold-buying consumers. Some players in the industry have adopted this practice.  

Q: The introduction of mandatory hallmarking in 2021 aimed to ensure the purity and quality of gold jewellery. How has this regulation affected consumer trust, and the overall dynamics of the retail jewellery market in India?

A: Mandatory hallmarking has strengthened consumer trust in gold jewellery by ensuring every piece meets strict purity standards. This move has helped develop a market built on transparency and quality. Additionally, it has also set a new benchmark across the industry, driving a collective move towards greater accountability and consistency that benefit all stakeholders. Overall, this regulatory framework reinforces gold as a safe-haven asset, establishing India as a global leader in trusted gold jewellery.

Q: Considering India's diverse regional preferences in gold jewellery, how can retailers tailor their offerings to cater to these varied tastes, while maintaining a cohesive brand identity?

A: India is celebrated for its cultural and regional diversity, with people across the country following unique customs and traditions. These are factors that also impact the jewellery preferences of buyers, as every state has its own distinctive style, influencing the varied preferences of its people. To be able to capture the larger chunk of customers, and to stay relevant in the market, retailers can develop collections that respect local traditions, while maintaining a brand identity when it comes to quality and authenticity. 

In addition, today's buyers are increasingly opting for daily-wear, lighter pieces, and modern contemporary pieces that offer both genuine craftsmanship and affordability. Retailers must keep such buying patterns and customer behaviour in mind when curating fresh designs. This will not only enhance customer loyalty across age groups, but also strengthen the brand's position in a highly competitive market.