Gold and jewellery shoppers in the UAE are utilizing various strategies, including monthly savings plans, loyalty and reward programs, trading in old gold, flexible payment options, and credit card promotions, to counteract the effects of soaring gold prices. With gold prices in Dubai remaining above Dh300 per gram, local gold jewelers report a surge in demand for these programs as consumers seek to navigate future purchases of precious metal jewelry amid high prices. The yellow metal hit a record high earlier this month, reaching $2,550 an ounce globally and Dh306.75 per gram in Dubai, before settling at $2,512.18 per ounce globally and Dh304.25 per gram in Dubai, surpassing key psychological thresholds.
Experts and gold jewelers anticipate further price hikes due to the escalating Middle East conflict and expectations surrounding the US Federal Reserve's decision to cut interest rates. Anuraag Sinha, managing director of Liali Jewellery, noted that more people are enrolling in monthly savings plans and loyalty programs to better manage their finances, mitigate gold price volatility, maximize purchase value, and achieve long-term goals. "Loyalty programs and savings schemes offer significant benefits for shoppers looking to buy gold jewelry during high price periods. They provide ways to earn rewards, access discounts, and manage spending more effectively, helping to offset the financial impact of rising gold costs. As a result, many are increasingly turning to these programs to handle the financial challenges posed by record gold prices," Sinha explained to Khaleej Times.
He further detailed that gold and jewelry buyers are adapting to record-high prices by opting for lightweight designs, utilizing savings plans and loyalty programs, waiting for sales, or trading in old gold. Liali Jewellery offers various loyalty programs and savings schemes, including Club Liali, partnerships with Emirates airline for Emirates Skywards, and rewards programs with different retailers. Ramesh Kalyanaraman, executive director at Kalyan Jewellers, stated that with gold prices at record highs, customers are engaging in strategic purchasing.
"Our loyalty points program has gained significant traction among customers, aiding them in managing their finances while enjoying exclusive benefits. Customers use their accumulated loyalty points from previous purchases to offset part of their gold purchase, effectively reducing the overall expenditure. Through our loyalty program, higher-tier members often receive additional perks such as discounts or exclusive offers, providing further savings," he noted. "We've observed that buyers are also becoming more selective and deliberate with their purchases. They are choosing timeless pieces that allow them to maximize the value of their investment. We also offer flexible payment options and credit card promotions to enhance their purchasing power," he added.
UAE jewelers provide various schemes and loyalty programs to reward customers with flexible payment solutions, additional discounts, exclusive offers, and credit card promotions to support buying power. Shamlal Ahamed, managing director for international operations at Malabar Gold and Diamonds, mentioned they offer two plans – the Jewellery Purchase Programme and Gold Rate Protection – to help customers navigate the latest surge in gold prices. The Jewellery Purchase Programme allows customers to invest in their desired jewelry through manageable monthly payments, starting from as low as Dh200. This program enables customers to plan and budget their jewelry purchases over time, rather than making a large, one-time expenditure.
Gold Rate Protection allows customers to lock in the current gold price by making an advance payment on their purchase. With an advance payment of 50% of the gold's value, the price can be secured for three months, while a 100% advance allows customers to fix the price for six months. "The added advantage of this facility is that customers always benefit, regardless of the direction in which prices fluctuate. If the gold price rises during the purchase period, customers can buy their jewelry at the booked rate, and if the price drops, customers can take advantage of the lower rate," said Ahamed. "Together, these programs provide a robust safety net against fluctuating gold prices," he added.
Shamlal Ahamed further explained that despite the steady increase in gold rates over the past few months, customers remain largely unaffected by the current market hike. "The consistent appreciation in gold's value has strengthened confidence in it as a reliable asset, reaching an all-time high. This growing trust explains why, despite elevated prices, customers continue to purchase gold," he concluded.
