Jewellers push promotions as tourist buying declines
RETAILERS TURN ATTENTION TO DOMESTIC SHOPPERS WITH CAMPAIGNS AND DEALS
The UAE’s jewellery chains are pulling out all stops to get hesitant shoppers back into their outlets during a crucial sales period for them, including offering free home delivery on diamond purchases and the waiver of making charges. Some of the retailers have also been able to seal alliances with local banks under which jewellery purchases made through credit card transactions can be paid off via extended monthly payments.
In many ways, jewellers are resorting to tactics that have already been deployed by retailers in other sectors, and even those in the virtual selling space. Also, their other source of sales — those generated from tourists — have been on the slide.
From the start of the month, the jewellery sector has been running campaigns centred around “Akshaya Trithiya”, a day on which Indians believe it is particularly “auspicious” to buy up on gold and precious accessories. This year, the event is marked for April 21.
“Since January, sales in the local gold and jewellery sector have been dropping short of expectations — there are fewer tourists and of the ones that are here, they are not spending as much,” said Abdul Salam K.P., Executive Director at Malabar Gold & Diamonds, which will home deliver diamond purchases made earlier on April 21. “That’s the reason why promotions are being tweaked almost exclusively to target the domestic shopper.”
Traditionally, Akshaya Trithiya sales account for between 1.5-2 tonnes of gold and jewellery sales, according to Salam.
Making charges
Retailers have responded by dropping making charges on 22K gold jewellery — such as the one from Pure Gold — which translates into a few percentage points of savings for buyers. Then there are the extended payment plans and free gold coins on purchases over and above certain levels, as given by Joyalukkas.
Jewellers are hoping that if they can offer enough incentives, they would get the local shoppers to come into their outlets. And once they do, they invariably buy something.
So, to get shoppers in through the door, jewellers are rolling out more than the proverbial red carpet.
“We need to, because local jewellery consumers are becoming intensely price sensitive — they have now reached a point where only a significant downward movement on pricing gets them back into buying,” said Cyriac Varghese, General Manager at Sky Jewellery, which is allowing potential shoppers to make a pre-order during the campaign period and thus ensure price protection if prices were to shoot up before April 21. And for those making the pre-bookings, they will have fast-track clearances at the stores once they come to collect.
“For the past few weeks, the shift in pricing has been limited to a dollar or two on either side, and not enough to convince buyers.
“This is why the promotions for this year’s Akshaya Trithiya are so important — we need more shoppers to come through, because the next big buying activity only comes up during DSS, That is, unless gold drops all of a sudden — then it’s a different story altogether.”