India’s Jewelry Market Shifts Online: E-commerce Set to Reach $22 Billion by 2028

In India, where purchasing gold jewelry has traditionally meant a visit to the trusted family jeweler, the rise of e-commerce is challenging this time-honored practice. The online jewelry market, projected to grow to $22 billion in the next three years, is fast becoming a key player in the Indian retail space.

Gitanjali Gems Ltd, the country’s largest diamond and gold jewelry retailer, is at the forefront of this shift. The company expects its online sales to increase significantly, with projections indicating that online channels will account for up to 20% of its total sales in the next two to three years, up from a mere 1% currently. This promising growth potential has even caught the attention of influential figures, including Ratan Tata, the former chairman of the Tata Group, who invested in Bangalore-based online jewelry store BlueStone last year.

To capitalize on this trend, many established jewelers are forging partnerships with global e-commerce giants such as Amazon, Flipkart, and eBay, following the Indian government's easing of gold import restrictions. Gartner Inc. estimates the total online retail market in India will reach $6 billion this year, with projections suggesting it could grow to $22 billion by 2018, according to CLSA Asia Pacific Markets.

While traditionally, Indian consumers have preferred to physically touch and feel jewelry before making a purchase, Gitanjali’s chairman, Mehul Choksi, believes that changing consumer behavior will lead to swift adoption of online jewelry shopping. “We have tied up with all the major online platforms and are always looking for more tie-ups,” he said. Gitanjali, which operates more than 4,000 sales points globally, has teamed up with platforms such as Amazon, Flipkart, eBay, and Jewelsouk to expand its online presence.

Online retailing offers numerous advantages, including convenience and the ability to browse at leisure without the pressure of an immediate purchase. According to Gaurav Singh Kushwaha, founder and CEO of BlueStone, “It allows consumers to take their time, evaluate their choices, and not feel obligated to buy immediately.” This is a major draw for young, tech-savvy consumers, particularly women, who are increasingly shopping online and are exposed to global jewelry trends.

BlueStone estimates that the online jewelry market could be worth up to $2.5 billion over the next 5 to 10 years, although it currently accounts for less than 0.1% of India’s $55 billion jewelry market. Last year, Indians purchased 662 metric tonnes of gold jewelry valued at $26.9 billion, surpassing China as the world’s largest consumer of gold, according to the World Gold Council.

With the government's relaxation of gold import restrictions, the market for both jewelry and bullion is expected to continue expanding. Shares of leading Indian jewelers, such as Titan Co., have risen significantly, reflecting growing optimism in the sector.

As established retailers move online, they are looking to expand their offerings without the need to keep physical stocks, said Rajeev Sheth, chairman of Tara Jewels Ltd. The company began selling its products on Amazon in December. “The changing behavior of consumers, especially young Indian women, is driving the shift to online,” Sheth noted.

To further tap into the growing online jewelry market, New Delhi-based PC Jeweller has tied up with U.S.-based online jewelry retailer Blue Nile to explore long-term sales potential. The company also plans to create its own website to provide the same comfort and luxury of shopping in its physical showrooms.

Titan, the largest player in India’s jewelry market, has also ventured into online retail. The company, which already sells jewelry through its website and nationwide network of retail outlets, is rumored to be considering a stake in the online jewelry retailer Caratlane.

BlueStone’s Kushwaha acknowledged that building trust with customers, particularly in a market dominated by traditional jewelry retailers, has been a challenge. However, the company’s "Home Try-on" service, which allows customers to receive jewelry at home for a trial period, is designed to ease concerns for first-time online jewelry buyers.