Covid: Weren’t diamonds forever?

Analysis of how the pandemic is transforming the luxury space

The only positive thing about pandemic is that it affects everyone indiscriminately and spares no one. A lot has been said and discussed about how the bottom of the pyramid gets affected the most by pandemic given the smaller discretionary spend percentage that they enjoy compared to the mighty rich. We’ll look at some of the long time bastions that were guarded by the prosperous for far too long. Lets start analyzing each of them one by one.

Shopping malls:

Shopping malls that were always crowded are seeing little to no crowd due credit to restricted statutory timings and movements. The public has become more conscious as well as cautious. They come to the mall only when they have a clear idea of what they want from the mall. Therefore, you will see only dedicated shoppers in the mall nowadays. Consumers are no longer in a mood of experimentation and generally opt for products that they have already tried in the past.

Paintings:

Expensive paintings are not considered as an impulse purchase. A person tries to comprehend the meaning of every stroke of the brush before making a decision. Veracity of authentic author is also a cause of concern that most like to disspell. With the advent of pandemic, people have more time to spare and a lot many of them have invested their time in learning more about art. As a result a surge in number of online auctions is observed since the second half of 2020. The first half of pandemic affected the sector as a lot many live auctions had to be cancelled or postponed indesfinitely. Christie’s and Sotheby are the two biggest auction houses in this space. Christie’s reported 25% decline in their 2020 sales when compared with 2019. But the trend is reversed when 2020’s second half figures are compared. Digital art and NFTs are also on the rise. Private sales, third party guarantee and online auctions have been the key drivers of growth for the auction houses in difficult times.

Luxury cars:

Need to establish a personal connect. Customers especially luxury car buyers see their car/bike as their own child. What can be done to build a personal connect with them is when a car is in manufacturing stage, at that time the different processes that a car is going through those moments can be captured. It would be more like a customer is seeing their baby grow. People will be emotional about their cars then and would show it to others also which would help in word-of-mouth marketing which is the most fundamental and authentic way of establishing trust.

Luxury real estate:

The industry saw a massive technology push that was already progressing with a sluggish pace in last one decade. 3D virtual tours of the houses using Virtual reality have become a new norm during the pandemic. Potential buyers can take the first look of each corner of their new home and even virtually walk to the glass window and enjoy the scenic beauty that is there outside. In this way, customer gets an idea before scheduling the site visit and it eventually helps in bringing the average number of meetings required before making an actual sale down. It also helps the clients in utilizing their time in more efficient way, allocating it only where it is needed the most. In India, the luxury real estate market was hit because of the fall in dispensable income. Also investors were hesitant to make a big investment at such risky and unpredictable timing. Once the dust settled, a recovery is being observed due credit to NRIs who flew to India during the pandemic and are now planning to settle here on temporary or permanent basis. Bangalore and Pune, known as India’s IT hubs, have bagged most of the NRI investment. As per a survey conducted, 75% of the NRIs looked for properties in the 90 lakh to 2.5 crore range which led to 50,000 properties being sold in the two aforementioned cities.

Diamonds:

If there is anything that the customer wants to touch and feel before making a purchase, then it is diamonds. It is often said that a diamond is what it means to you. For some it could mean the time when they turn 18 , for some it could be the time they got married while for some it could be the time when for the first time they had the financial ability to make an expensive purchase. Alternatives such as artificial diamonds have made diamonds very affordable to the millennials.

Restaurants:

The menus are becoming more diverse in modern times. People want right from Tacos to Thukpas. The focus I believe should be to look into our own backyard for the local hidden cuisines we have in India rather than madly run behind foreign cuisines. Because if one part of India already likes it, someone in the other part of India might also develop taste buds for it.