Market Situation and Consumer Trends for 2024

Global Economy – Towards Stability

The world economy is moving towards stabilization after a turbulent 2023, which was significantly better than 2022. Although good sales at the end of 2022 put us in a positive mood for 2023, mid-year saw a slowdown, causing concern among entrepreneurs. Given the overall situation, the future is still uncertain, requiring producers to plan cautiously to avoid the swings experienced in 2023. Despite decreasing inflation, retail prices will continue to rise. On the positive side, cost stabilization is anticipated, signalling a favourable outlook for our industry with projected sales growth in 2024.

Tourism – Record Year

For the first time since Covid-19, 2024 is estimated to surpass the 2019 level in terms of travel. The return to travel signifies a shift back to traditional in-store shopping. Pre-pandemic, 30% of all jewellery purchases occurred during travel, impacting tourist-dependent stores more than those in shopping malls.

Not only will people travel more in 2024, but they are also more willing to spend during their journeys. 80% of consumers express a desire to make purchases while travelling, with 28% planning to spend more than in 2023.

Tourism – New Needs

Over half of consumers are seeking new and less popular destinations, beyond iconic shopping destinations like Paris or London. Less traditional locations such as Edinburgh or Lisbon are gaining popularity. In response to the post-pandemic need for freedom and escapism, consumers will not only travel more but seek new, deeper experiences. For stores, this means ensuring a rich assortment, quality, closer interaction with products, and knowledgeable staff.

Jewellery, as a durable product retaining value in uncertain times, will experience increased sales, becoming a sought-after memento from travels.

Tourism – China

For nearly two decades, travellers from central China have driven global tourism, constituting 1/5 of worldwide tourism spending. In 2024, Chinese travellers will resume pre-pandemic travel frequency, but their purchasing trends will change. Extended closures boosted local tourism, a trend expected to continue in 2024. Local destinations like Hainan, now a top location for tax-free shopping, are gaining attractiveness. It’s anticipated that 60-70% of purchases will occur domestically, reversing the pre-pandemic ratio.

For us, this means Chinese travellers will return to European cities, but in smaller numbers. Therefore, offering a unique assortment and experiences not found locally in China are crucial.

Advertising – New Era of Influencers

68% of consumers feel overwhelmed by the quantity of social media ads. Reliance on influencers has dropped by 65%, causing a drastic decline in advertising effectiveness. Consumers seek authenticity and personalities they can identify with, shifting away from celebrity endorsements. Authenticity and a sense of humor now take precedence.

A notable example is Khaby Lame, followed by over 162 million people. A former factory worker who lost his job during the pandemic, he started a TikTok account in June 2022. Through his silent sketches, commenting on life scenes, he earned $16.5 million.

We do not recommend this type of a promotion for jewellery but this is a trend that cannot be ignored.

Bullwhip Effect

The bullwhip effect explains why delivery times vary, sometimes being lengthy, and why we request that you send your orders as early as possible. A mere 5% increase in retail sales results in a 20% rise in demand for the manufacturer, escalating along the supply chain. This phenomenon affected the industry in 2020 when production was abruptly halted, and in 2023 when delayed deliveries and reduced order quantities occurred due to increased demand. Such fluctuations may persist until the market stabilizes. We appreciate your understanding during both extended delivery times and when eagerly awaiting your orders.