Luxury Jewelry Market is estimated to be valued at USD 19.91 Billion in 2024 and is expected to exhibit a CAGR of 17.1% over the forecast period 2024-2031. Furthermore, growing millennials population coupled with rising disposable incomes especially in emerging economies of Asia Pacific is fueling the demand for luxury jewelry across the globe.
Rising disposable incomes:
Rapid economic development in major markets such as China, India, and Southeast Asia have increased disposable incomes of middle-class population significantly over the past decade. Higher disposable incomes have enabled customers to spend more on discretionary luxury products including jewelry. This rising affordability is driving the sales of luxury jewelry globally.
Growing millennial population
Millennials currently represent a sizable chunk of the global population and luxury purchases. The luxury jewelry brands are targeting this demographic segment aggressively through digital and social media marketing. Luxury jewelry products are emerging as a trend and status symbol among millennial groups across regions which is supporting the market growth.
Increasing disposable incomes and growing luxury spending drive demand
One of the major drivers of the global luxury jewelry market is the rising disposable incomes and growing spending power of consumers globally. As economies grow and people earn more, they are able to spend more on discretionary and luxury purchases. Countries like China, India and other emerging markets have seen a rapid growth of their middle and affluent classes in recent decades. This has translated into greater demand for luxury brands and products across categories including jewelry. High-end jewelers have capitalized on this driver by expanding into new markets and offering designs tailored to local tastes and budgets.
Growing influencer culture promotes luxury lifestyle
Another driver fueling the luxury jewelry industry growth is the proliferation of the influencer culture on social media platforms. Celebrities and social media influencers flaunting expensive watches, handbags and jewelry on Instagram and other apps has made luxury and branded goods highly aspirational for millions of everyday users. This has normalized the display of wealth and status through luxury consumption. Jewelry brands have embraced influencer marketing by sponsoring popular influencers, thereby gaining exposure to a new young clientele base. The 'FOMO' or fear of missing out factor driven by influencer culture persuades more consumers to purchase luxury jewelry and keep up with trends.
Economic uncertainties restrain spending
A major restraint for the luxury jewelry market is the uncertainty and volatility in global economic conditions. During periods of economic slowdown, recession or high inflation, discretionary spending on luxury and high-end products is often the first to be cut back. As jewelry constitutes non-essential spending, demand sees a dip when consumer confidence is low. The luxury sector is quite sensitive to macroeconomic swings. Recent uncertainties like Brexit and U.S.-China trade war have had negative impacts. Downturns force jewelry brands to scale back marketing spends, store expansion plans and introduce more affordable collections to beat the slowdown.
Rising costs of raw materials squeeze margins
Escalating prices of precious metals like gold and gemstones used in luxury jewelry making pose a challenge as well. Gold, being a globally traded commodity, sees price fluctuations depending on external macroeconomic and geopolitical factors. It becomes costlier to procure the raw materials during inflated markets. While brands try absorbing some increases, rising input costs eventually have to be passed on to customers to protect profits. This makes jewelry products more expensive and less affordable, reducing their competitiveness against other luxury goods. Tighter margins force some brands to switch to less expensive alternatives or introduce affordable product lines.
Growing demand from millennial consumers
A significant market opportunity for luxury jewellery manufacturers and retailers is the rising millennial generation of consumers born between 1981 and 1996. As they enter the prime spending years of their lives and careers, their consumption patterns will greatly influence luxury goods demand over the next decade. Research shows millennials allocate more spending on experiences and feel comfortable openly displaying wealth through luxury accessories and fashion. They also have an adventurous approach to jewelry wearing unconventional pieces. Luxury brands are catering designs, marketing and retail experiences specifically to draw this lucrative demographic group. Their focus on self-expression through unique pieces bodes well for jewelry industry growth.
Increasing popularity of lab-grown diamonds
Another potential opportunity is the emergence of lab-grown or cultured diamonds as a viable alternative to mined gems. While still only accounting for a small market share, lab-grown diamonds are gaining legitimacy fueled by ethical and environmental concerns around mining. They are often 50-70% cheaper than natural diamonds but have the same optical, physical and chemical attributes. Top jewelry brands are warming up to offering lab-grown options in their collections to appeal to eco-conscious and value-seeking buyers. Their growing acceptance as prestige products versus just simulants could open new customer segments and market potential up for capture in the coming years
*Link: https://www.coherentmarketinsights.com/market-insight/luxury-jewelry-market-2278
Key Developments
- In 2023, Byredo made an exciting expansion into the realm of fine jewelry, marking a significant milestone for the renowned brand. Byredo, known for its exceptional fragrances and luxury products, unveiled its highly anticipated Fine Jewelry collection, captivating the fashion and beauty industry with its exquisite designs.
- In 2023, Luxury Jewelry Brand, Aurate, Partners With Helzberg Diamonds to Launch Exclusive Collection
- In May 2023, Saint Laurent launched a jewellery line
- In 2020, Gucci joins Alibaba's luxury e-commerce site to woo Chinese consumers
Key Players
Guccio Gucci S.p.A., The Swatch Group Ltd., Richemont, Tiffany & Co., GRAFF, Louis Vuitton SE, Signet Jewelers Limited, Chopard International SA, MIKIMOTO, Pandora Jewelry, LLC, Variation, Gem Factory India, Fine Euro, Bvlgari Jewelry, De Beers, Pomellato, Damiani, Fabergé, Chopard, and Piaget
