Sales of luxury jewellery declined significantly during 2020 as the social distancing protocols that were enacted in response to the COVID-19 pandemic encouraged many people to postpone weddings and various other celebrations that are often associated with gifts of jewellery until the COVID-19 situation is resolved to the extent that they can safely host a large celebration for their friends and family. This has had a particularly strong negative impact on demand for luxury jewellery, which is more likely to be purchased as gifts for major celebrations such as engagements, weddings, wedding anniversaries and milestone birthdays.
Traditionally, sales of luxury jewellery in Indonesia have tended to spike in the run-up to major religious festivals such as Eid Al Fitr and Hari Raya. This is because many of Indonesia’s more affluent people choose to purchase expensive items of jewellery before returning to their home towns and villages, a tradition known as Mudik, either as gifts for friends and family or in many cases to flaunt their wealth and signify their elevated social economic status to their proud family and friends back home.
2020 saw a significant increase in the price of gold at global level. This is because gold was increasingly regarded as a safe investment at a time of considerable uncertainty in currency and capital markets.
While the forecast period is expected to see sales of luxury jewellery recover robustly from the pressures created by the COVID-19 pandemic during 2020, sales growth is not expected to be as high as in other categories of luxury goods. This is set to be due mainly to the consistent increases that are expected to be seen in the price of gold at global level as gold becomes a more attractive investment.
The popularity of luxury costume jewellery is expected to increase over the forecast period as consumers priced out of luxury fine jewellery due to the rising price of gold turn to less expensive but equally elegant items categorised under luxury costume jewellery. As mentioned above, the rising price of luxury fine jewellery is largely tied to the increasing price of gold at global level, with many of those unable to afford luxury fine jewellery expected to turn to jewellery made from gold-plated steel rather than solid gold, with luxury costume jewellery expected to come to the fore, partially at the expense of luxury fine jewellery.
The forecast period is expected to witness the increasing importance of collaborations between jewellery brands and popular celebrities and social media influencers for the marketing of luxury jewellery. Many luxury fine jewellery brands have sought to take advantage of the strong public profiles of numerous notable Indonesians in their marketing campaigns, launching their fine jewellery collections in collaboration with notable public figures and, increasingly, social media influencers as well.
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Understand the latest market trends and future growth opportunities for the Luxury Jewellery industry in Indonesia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Luxury Jewellery research and analysis database.
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