Over the last decade there has been a steady increase in demand for silver and platinum jewellery, driven by the rising gold price as well as changes in consumer behaviour and product innovation. For instance, gold-plated silver jewellery has emerged as one of the fastest growing segments in recent years. As a result, silver jewellery fabrication has increased from 700t in 2010 to 1,800t in 2021.
Meanwhile, platinum jewellery demand has risen from 0.8t in 2010 to 3.9t in 2021. This has led to a debate across the trade as to whether the growth in silver and platinum jewellery is hurting the gold market. While silver and platinum jewellery have made inroads, they have yet to pose a significant threat to gold jewellery consumption.
Most silver jewellery in India consists of traditional pieces, such as anklets, toe and nose rings. The only silver segment that overlaps with gold is gold-plated silver jewellery and modern daily wear, in particular sterling silver pieces that are attractive to the younger consumer.
The growth in the silver jewellery segment has largely been a function of the rising gold price; most modern silver jewellery features rose or yellow gold-plating, which suggests that it is being promoted as a low-cost alternative to gold for daily and occasion wear.
Over the last five years, traditional designs, such as temple and bridal jewellery, have also been made in gold-plated silver. Given the fact that many large independent and chain stores are now offering this jewellery in the silver section of their displays, this may have the potential to cannibalise gold jewellery sales.
Gold-plated silver jewellery closely resembles real gold jewellery, especially as manufacturers are improving both the design and finish of these items. We believe, however, that this is unlikely to emerge as an outright competitor to gold jewellery; it is more probable that it will gain only a small percentage of gold jewellery sales in the daily and occasion wear market, particularly if gold prices continue to outpace silver.
In terms of platinum, while this is a fast-growing market, in absolute terms it is extremely small. A consumer who buys platinum rarely does so as an alternative to gold. Platinum jewellery does, however, compete with gold in certain areas: most notable are products for men, such as bracelets, chains and love bands, which make up the fastest growth segment.
It is also worth noting that platinum sales are driven by the younger generation, especially the middle and upper middle classes, as it has always been marketed as a premium product aimed at evolved and aspirational consumers rather than targeted towards a mass market. However, Metals Focus believes that there is little understanding of platinum jewellery outside the young urban demographic and so gold comfortably retains its standing as the most popular aspirational purchase.
Heera Zhaveraat (HZ International) A Diamond, Watch and Jewellery Trade Promotion Magazine provide dealers and manufactures with the key analytical information they need to succeed in the luxury industry. Pricing, availability and market information in the Magazine provides a critical edge.
