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<ul><li>Gold prices are falling for the third consecutive week as the Indian economy recovers and the number of COVID-19 cases decline.</li><li>The diminishing value of the yellow metal is good news for customers looking to buy up gold ahead of the summer wedding season and <keyword id="126295" type="ORGANIZATION" weightage="20" keywordseo="Akshaya-Tritiya">Akshaya Tritiya</keyword>.</li><li>Jewellers are optimistic that the fall in the price of gold and the upcoming festival season will drum up demand for the physical product.</li></ul>Gold prices are finally falling after a year of being on the rise. And, people in the world’s biggest market for gold, India, are taking advantage of the opportunity. Benchmark gold futures in the country have dropped 20% from a record high in August last year of ₹56,200. They are basically a deal to trade gold at terms decided now but with a settlement date in the future. Moreover, as compared to the beginning of 2021, gold prices are down by over ₹5,000 from highs of ₹48,500. This means the precious metal has technically entered bear territory. “Gold prices fell for the third consecutive week as risk on sentiments kept investors away from precious metals,” said HDFC Securities in its report dated March 8. For consumers, there couldn’t be better news with the summer wedding season just around the corner and Akshaya Tritiya — pegged as an auspicious day to buy gold — falling on May 14. Why is the price of gold falling? Simply put, consumers are no longer looking for a safe haven store of currency. During the coronavirus pandemic, the markets were volatile and rates offered by banks were sub par, giving gold the edge over others as a store of value. Now that the number of COVID-19 cases are slowing down and the economy is on the track to recovery, gold prices are coming back down. Investors are instead putting money into US government gold yields to earn higher returns. “Gold prices declined on a stronger dollar as traders and investors switched to the best alternative to gold.” noted HDFC Securities. As a result, the dollar index rose by 1.2%. Government officials told <a href="https://www.bloombergquint.com/global-economics/gold-s-slump-boosts-indian-buying-ahead-of-wedding-season">Bloomberg</a> that imports have jumped 41% in February to the highest that they’ve been since November 2019, which is another indicator of demand coming back. It’s time to buy up gold Last year may have been stellar to buy gold on the commodity exchange, but physical consumption was in the pits. According to the World Gold Council (WGC), the demand for jewellery plunged by 34% in 2020 as compared to the year before. Now, the demand for physical gold is seeing an uptick as prices dip to a near one-year low. It also helps that the Modi administration reduced import duty on the yellow metal from 12.5% to 7.5%. "GJC had been representing this concern for many years and we are glad that the government has acknowledged it and reduced the import duty," said chairman of All India Gem and Jewellery Domestic Council (GJC) in a statement. Lower prices, however, are only one part of the picture. In India, gold holds an important place in Indian weddings and the summer wedding season is set to occur between mid-April to May. Jewellers are also hoping that Akshaya Tritiya — the second-most auspicious day to buy gold for Hindus after Dhanteras — will also lead to a surge in demand. “The festival and wedding looks good. The investment demand has come back, and the jewelry demand will come in after the rates stabilize,” said Ashish Pethe, chairman of the All India Gem and Jewellery Domestic Council in a <a href="https://www.bloombergquint.com/global-economics/gold-s-slump-boosts-indian-buying-ahead-of-wedding-season">statement</a>. He believes that the demand will also see a boost since a lot of weddings that were postponed in 2020 due to the coronavirus pandemic will be scheduled for 2021. Brokerage HDFC Securities expects gold prices to remain low in the coming week, unlikely to dip below ₹44,000 per 10 grams. Analysts believe the rates of precious metal may continue to fall given the sharp recovery in economic activity and a slowdown in COVID-19 infections. However, gold could turn bullish again if central banks choose to step in. Sovereign debt for all countries has increased during the pandemic and the balance sheets are bloated in the face of public expenditure. “We do not think yield will sustainably rise given the fact that governments do not favour higher yields on their accumulated gigantic debt,” said the lead analyst of institutional equities at YES Securities, Hitesh Jain. Rising rates of yields — the interest rate that the government has to pay out for borrowing money from the market — is not favourable with high debt. SEE ALSO: <a href="https://www.businessinsider.in/tech/news/india-blockchain-tech-to-make-sms-more-secure-is-leaving-users-locked-out-of-their-account/articleshow/81409145.cms">India’s blockchain tech to make SMS more secure is leaving users locked out of their accounts — and potentially more at risk</a> <a href="https://www.businessinsider.in/india/news/india-is-using-the-quad-alliance-to-get-help-from-the-us-japan-and-australia-to-match-chinas-covid-19-vaccine-push/articleshow/81408044.cms">India is asking the QUAD for money to boost vaccine production and counter China’s moves on the global stage</a> <a href="https://www.businessinsider.in/business/corporates/news/elon-musks-net-worth-has-eroded-60-billion-in-just-two-months-as-teslas-market-cap-falls-35/articleshow/81407453.cms">Elon Musk’s wealth has eroded $60 billion in just two months as Tesla's market cap falls 35%</a>

Gold prices are falling and the world’s biggest market for the yellow metal is hoping for more shoppers

<ul><li><keyword id="31174" type="PERSON" weightage="20" keywordseo="brands">Brands</keyword> have seen early signs of recovery during <keyword id="126295" type="ORGANIZATION" weightage="20" keywordseo="Akshaya-Tritiya">Akshaya Tritiya</keyword> and <keyword id="6385850" type="UNKNOWN" weightage="20" keywordseo="Raksha-Bandhan">Raksha Bandhan</keyword> and their businesses are approaching normalcy. </li><li>After surviving the storm during the lockdown, brands have a lot of hope resting on the festive season to bring in cheer and profitability in their businesses. </li><li>With Ganesh Chaturthi around the corner, we decided to speak to a few brands across categories on how they are preparing for the festive season and what kind of expectations they have pinned on the latter half of the year for recovery. </li></ul>Brands are pinning a lot of hopes on the festive season this year to help them bounce back. They have started working on their advertising campaigns in full swing to win back consumer trust and help shape the <keyword id="29547" type="PERSON" weightage="20" keywordseo="Market">market</keyword> sentiment. The festive season, which begins in August and continues till January, often results in a disproportionate increase in demand of goods and services, marking an important period for most consumer brands. However, the pandemic this year has made consumers frugal and the current market unrest has taken a sharp toll on the total spends. As per Madison’s report, AdEx collapsed by as much as 65% because of COVID-19 in Q2, indicating how badly the economy has been performing so far. Last year for Television, the Indian Premier League (IPL), ICC World Cup and Elections in Q2’19 contributed around Rs 3,000 crore (34% to the TV AdEx in Q2’19). However, the pandemic removed both these money-spinners from the AMJ quarter this year, which has added to the decline. This year, brands are trying to come up with innovative solutions to reach out to their consumers at their door steps and are optimistic about seeing a stable growth in the next few months. Fashion e-commerce giant Myntra has seen early signs of recovery and <keyword id="1549018" type="PERSON" weightage="20" keywordseo="consumer-sentiments">consumer sentiments</keyword> picking up during Raksha Bandhan as it witnessed a surge in demand for women's ethnic wear, men’s occasion wear, kids wear, and accessories such as watches, handbags. It also saw 3.5 million customers shopping during the June edition of EORS, a testimony of how consumer sentiments are getting back on track. “The festive season, followed by winter, is the most exciting quarter for Myntra. This year we are expecting a massive scale and growth in festive buying as consumer sentiment continues to be strong. Myntra is already operating at a pre-lockdown scale, and this upcoming festive season will definitely help us in boosting our growth further. Our focus will continue to be on enhancing customer experience by providing high-quality merchandise in a curated and personalized store, along with safe and fast delivery. Our new customer acquisition is at an all-time high and we are ensuring we help them in all their lifestyle needs. We are witnessing a spike in our Tier II and Tier III customers and orders as well,” said Ayyappan Rajagopal, Head of Business, Myntra. Another new-age brand Melorra that specializes in modern jewellery, has managed to avoid the losses incurred by various other businesses during the pandemic months. It saw a 400% growth in the last financial year, and is confident of matching that level of growth with a strong performance in the upcoming festive season. “The festive season this year is expected to be even more impactful than the past for Melorra. Firstly, the lockdown that started in March slowed down the jewellery purchase due to disruption in the delivery logistics, and most of the people are looking to buy jewellery now that the deliveries have resumed. Given the pandemic, all festivities in the first 2 quarters of the FY was a washout, hence there could be a trend reversal during festive season – but not at the previous levels. Since the prices are also at an all-time high, customers would opt for lightweight and trendy gold jewellery that is not only stylish but also easy on the pocket. Melorra caters to women who live in the moment and do not keep gold stacked away in lockers like before. Hence, it is definitely a key period for the brand and the jewellery industry at large,” said Sharat Krishnan, Head of Marketing, Melorra. The festive season has always been the most important part of the year for the jewellery business. Titan has already seen 80% recovery because people are celebrating their milestones with their families at home. It has a campaign and launch of a new collection lined up for October. Ajoy Chawla, CEO Jewellery Division, Titan Company Ltd sees no reason why the festive season shouldn’t be as good as last year. “It would be as good as last year or slightly lesser. The most optimistic expectation is that it should be as good as last year. Even if it is 90% or 80% close to last year’s performance, that’s good. We’re currently seeing 80% recovery and this is my best estimate. We’ve seen this recovery because people are still celebrating milestones like anniversary, birthdays, etc. They understand that the reality is grim but how long can you keep your life on hold? They want to feel good. Also, Q3 is wedding season but the festive season is delayed this year so the season may start a little slower unless there are massive rebound cases. Some markets also take two steps forward and three steps back, there is always some fluctuation. However, after October, we are hoping to see more stability. We will also launch a new collection and campaign around October,” shared Ajoy Chawla, CEO Jewellery Division, Titan Company Ltd. On what the consumer sentiment would likely be this festive season, Nidhi Sinha, Head of Content, Mintel India said, "One of the most important things people are looking forward to once the restrictions of the pandemic are lifted is meeting friends and family. However, according to research from Mintel’s Global COVID-19 Tracker in August, 42% of Indian consumers are looking forward to meeting family and friends in person compared to 34% of consumers in early July. This desire has accelerated due to the onset of the festive season." Mintel's research data indicates that consumer sentiment is improving and there is more willingness to spend on luxury items and good brands in the market. Sinha added, "Ganesh Chaturthi, which is round the corner, would be one such important festival that would entail celebrations in a different way so as to be in line with the pandemic protocols. As people continue to be under restrictions due to the pandemic, this festival is expected to be low key compared to regular times. However, Mintel research highlights that 30% of Indian consumers are planning to spend more on clothes and accessories, presenting an opportunity for brands. This is indicative that people are planning to spend on indulgences despite a negative economic outlook. Brands like Gemini oil, Ferns and Petals and Cadbury have been very agile in talking about the changing face of the festivities and how it is an opportunity for people to spend such festivals at home with their loved ones.” Festive season is an important period for the retail industry. It is a time when consumer spending is at an all-time high. One of the leading sportswear brands PUMA has multiple new launches planned throughout the season to cater to increasing demand. Telling us how the consumer sentiment changed in retail, Abhishek Ganguly, General Manager, PUMA India and Southeast Asia said, “As we’re witnessing right now, online channels will continue to be a convenient option for consumers to shop. Given the precautions around health and safety, we are seeing people shop online or go to a store where they are confident about the hygiene measures being implemented. Having said that, as lockdown continues to be relaxed across the country, we are seeing a steady week-on-week increase in footfalls with consumers visiting our stores to buy fashion essentials.” On festive expectations, Ganguly added, “Over the last 3-4 months, we have been seeing steady growth across both our offline and online channels. The conversions have increased substantially from pre-Covid times as people exactly know what they want to buy and are shopping with a clear intent. Given the trend of how things are continuing to improve compared to the previous months, we are very hopeful of a strong September and October. We hope this trend continues through the festive season and beyond.” Electronics giant Philips has launched a few new products like Smart Hair Dryer, Eyebrows Trimmer this month to ride on the improving consumer sentiment due to the festive season. Gulbahar Taurani, Vice-President, Personal Health, Philips Indian Subcontinent, Philips India, said, “The trends indicate that this is going to be a good season. We will have our challenges in terms of supply chain, partial lockdown, movement of products because the number of COVID cases are going up. From a demand standpoint, we see a very positive sentiment. I believe that this is going to stay, which will drive the festive season. As a part of the festive season, we had a couple of new launches last month itself.” The furniture segment, which was on complete halt during the lockdown as it did not fall under essentials, is also gearing up for the festive months. Given that individuals are spending more time at home due to the lockdown, home-grown brand Pepperfry witnessed an uptick in demand for WFH furniture and décor. In fact, Pepperfry is already at 100% of its pre-lockdown sales volumes. Kashyap Vadapalli, Chief Marketing Officer &amp; Business Head, Pepperfry is now anticipating to see this trend boost their sales further as people continue to focus on making their home spaces better equipped for everything. The brand is upping its digital media game and has launched a new campaign called ‘Swadeshi is Great’. “Given that household products and celebrations at home play such an important role during the festive season, consumers are constantly looking to revamp/renovate the space such that the home category witnesses a natural upswing in demand during festivals. With this combination of consumer adaptation and brand innovation, we are positive about the consumers’ outlook and demand for categories like home décor and furniture. As consumers have become apprehensive with regards to shopping offline or even stepping outside, they are increasingly adapting to buying online. Our online business is already at 120% of pre-COVID levels. As we move along, we plan to keep innovating with digital tools to enhance our consumers’ buying experiences,” said Vadapalli. The sudden outbreak of the pandemic brought a lot of businesses to a standstill. However, one of the few sectors that have seen an upturn amid the nationwide lockdown is EdTech. Now, to evolve with changing times and to prepare for the upcoming festive season, upGrad is looking at altering its marketing strategy. It is shifting its spends towards TV as consumers would want to spend more time together, while supplementing it with digital. Telling us what kind of changes EdTech has gone through lately, Arjun Mohan, CEO-India, upGrad said, “Given the current scenario, consumer priorities are being re-calibrated. They are now undergoing a behavioral shift which is directly reflecting on their spends. Unlike earlier, individuals today have ample time and money to spend on upskilling options, which otherwise, was parked for a later date. upGrad has seen a big behavioral shift in the mindset of parents too towards learning online, as they have seen their kids benefiting from it in real-time. This is one of the major drivers that has created a massive demand for our specialised online programs, which not only enhances the domain knowledge, revise skill sets, etc. but also help professionals achieve desired career outcomes.” All brands voiced their confidence that the worst has passed, and the markets will only move towards normalcy hereon.

Festive Marketing: Brands are optimistic that improving consumer sentiments will help them bounce back and bring in profitability

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Gold prices are falling and the world’s biggest market for the yellow metal is hoping for more shoppers

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Festive Marketing: Brands are optimistic that improving consumer sentiments will help them bounce back and bring in profitability

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