Luxury Jewellery in Thailand

2020 IMPACT

The COVID-19 pandemic places pressure on the retail distribution of luxury jewellery

Luxury jewellery faced a very unfavourable scenario during 2020 as the COVID-19 pandemic led to sales dropping substantially over the course of the year. The main negative influence on category sales was the unavailability of the leading store-based retail channels for luxury jewellery during the quarantine lockdown that was in place between the middle of March and the middle of May.

No major stock shortages or interruptions to the supply of luxury jewellery are seen

Despite the issues seen in the retailing of luxury jewellery over the course of 2020, the category faced no major product shortages during the year as the COVID-19 pandemic did not result in any major interruptions to the supply chains of the category’s leading players. However, declining demand did force the category’s leading brands to review their pricing policies and marketing campaigns so as to maintain profitability at a time of flagging demand.

Purchases of luxury jewellery tied to brand privileges as a way of boosting demand

Another important strategy that emerged over the course of 2020 as luxury jewellery brands sought to boost sales in the face of falling demand due to the COVID-19 pandemic was to link sales of products in the category to various brand -related privileges. These privileges generally consisted in access to exclusive, often limited edition products sold in various other categories of luxury goods under the same brand.

RECOVERY AND OPPORTUNITIES

Sales expected to shift towards e-commerce despite challenges

At the end of the review period, many Thai consumers remained extremely reluctant to purchase luxury jewellery via e-commerce. This was mainly due to the risk of unwittingly purchasing fake and counterfeit items, but also due to the perceived risk of online payment fraud and the lack of confidence in delivery services.

Price promotions and sales events likely to emerge strongly to spur sales

Faced with a bleak year for sales of luxury jewellery during 2020, many of the category’s leading brands sought to rely on aggressive price promotions to attract the attention of consumers and support flagging sales. For those brands operating retail outlets in shopping centres, a popular option was to align themselves with the promotional activity of the shopping centres that host their mono-brand boutiques.

Social media expected to become increasingly crucial for sales and marketing

The unique exigencies of the COVID-19 pandemic led many of the leading players in luxury goods to focus more on their online operations during 2020. Consumers meanwhile became less reluctant to purchase luxury jewellery online over the course of the year.