Largest Jewellery Trade
INTRODUCTION TO THE INDUSTRY
EVOLUTION OF JEWELLERY INDUSRTY IN INDIA
The Indian subcontinent has the longest continuous legacy of jewellery making anywhere since Ramayana and Mahabharata times. While Western traditions were heavily influenced by waxing and waning empires, India enjoyed a continuous development of art forms for some 5000 years. One of the first to start jewellery making were the peoples of the Indus Valley Civilization. By 1,500 BC the peoples of the Indus Valley were creating gold earrings and necklaces, bead necklaces and metallic bangles. Before 2,100 BC, prior to the period when metals were widely used, the largest jewellery trade in the Indus Valley region was the bead trade. Beads in the Indus Valley were made using simple techniques. First, a bead maker would need a rough stone, which would be bought from an eastern stone trader. The stone would then be placed into a hot oven where it would be heated until it turned deep red, a colour highly prized by people of the Indus Valley. The red stone would then be chipped to the right size and a hole drilled through it with primitive drills. The beads were then polished. Some beads were also painted with designs. This art form was often passed down through family; children of bead makers often learnt how to work beads from a young age.
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Jewellery in the Indus Valley was worn predominantly by females, who wore numerous clay or shell bracelets on their wrists. They were often shaped like doughnuts and painted black. Over time, clay bangles were discarded for more durable ones. In India today, bangles are made out of metal or glass. Other pieces that women frequently wore were thin bands of gold that would be worn on the forehead, earrings, primitive brooches, chokers and gold rings. Although women wore jewellery the most, some men in the Indus Valley wore beads. Small beads were often crafted to be placed in men and women's hair. The beads were about one millimetre long.
A female skeleton (presently on display at the National Museum, New Delhi, India) wears a carline an bangle (a bracelet) on her left hand.
India was the first country to mine diamonds, with some mines dating back to 296 BC. India traded the diamonds, realising their valuable qualities. This trade almost vanished 1,000 years after Christianity grew as a religion, as Christians rejected the diamonds which were used in Indian religious amulets. Along with Arabians from the Middle East restricting the trade, India's diamond jewellery trade lulled.
Today, many of the jewellery designs and traditions are still used and jewellery is commonplace in Indian ceremonies and weddings.
INTRODUCTION TO INDIAN JEWELLERY INDUSTRY
India is a leading player in the global gems and jewellery market. The gems and jewellery industry occupies an important position in the Indian economy. It is a leading foreign exchange earner, as well as one of the fastest growing industries in the country.
The two major segments of the sector in India are gold jewellery and diamonds. Gold jewellery forms around 80 per cent of the Indian jewellery market, with the balance comprising fabricated studded jewellery that includes diamond studded as well as gemstone studded jewellery.
The Indian gems and jewellery industry is competitive in the world market due to its low cost of production and the availability of skilled labor. In addition, the industry has set up a worldwide distribution network, of more than 3,000 offices for the promotion and marketing of Indian diamonds.
Inter-Firm Rivalry -HIGH
- Two types of rivalry. (1) Inside India & (2) Outside India.
- Large presence of unorganized sector. 0.2 Million Gold jewelers and over 8,000 Diamond jewelers
- International rivals Such as, China
- Threat from producing nation like S.A. & Russia.
Bargaining Power of Suppliers - Medium
- In jewellery industry the suppliers are S.A., UAE, Australia, US, Congo, Botswana, Russia, DTC.
- Few Alternatives of cutting & polishing.
- Skilled labor
- Bargaining power of India is enhanced because India is largest consumer of gold jewellery.
Bargaining Power of Buyers - Low
- Divided in two types
- Domestic buyers &
- Foreign buyers
Threat of Substitutes: Low
- Substitutes are Real assets, Stock market, & Bank deposits & mutual fund investment and Other types of jewellery like imitation jewellery, bagasra jewellery, stone jewellery etc.
- Second preferred investment behind bank deposits
- Status and standard of living increase so demand is increasing at high rate.
Barriers to entry Low to Medium
- Low capital requirement
- Government subsidy
- EXIM policy & government's rules-regulations are high
- Skilled manpower is essential
- Advanced technology required
Availability of cheap and skilled labor
India has a large labor force and this has made the country the biggest diamond-cutting center for small roughs. Indeed, were it not for Indian workers, many of these small diamonds would be put to industrial use rather than jewelry. India's strength lies in the two million highly skilled workforces in the country in the gem & jewellery sector, out of which one million are exclusively engaged in export production, who virtually carve exclusive fancy stones. All the processes, right from sorting to polishing requires analytical skills, which cannot be relied upon with machines.
This essay is an example of a student's work
Experience plays a very important role in the success or failure of a business because of the diversity and unique features of diamonds. It requires a lot of experience to diagnose as to what you would obtain after polishing a diamond. It is not necessary that two diamonds looking similar are same. They can be different too. Experience is needed to understand the following features of rough diamonds, which are to be bought for further processing by any diamond processing company.
They are: -
- Toughness: as to how are diamonds and as to how much effort will be required to polish them.
- Shade: rough diamonds look just like stones and only experience could tell as to what would be the shade of the diamond.
- Purity: it is also important to examine the purity of the diamond.
Pricing and inventory management
The diamond industry virtually offers the entire range of products, a steady supply of raw materials and a state of the art manufacturing facilities is something that no other center will be able to match. India's USP in the days to come is to achieve all round quality at low price.
Supportive government policy
Since the diamond industry is one of the key contributors to the foreign exchange of our country the government has played a very supportive role to this sector. Incentives like Diamond Dollar Account (DDA) and SEZ packages and lowering of import duties are some examples. The government is always trying to provide a helping hand for the promotion of the diamond industry.
Low cost of production
The cost of production of diamonds in India is much less as compared to other countries. This is due to the availability of skilled and cheap labour force in the country. The cost of production of each piece of diamond increases with an increase in the size of the diamond. The government is also playing and important role by providing incentives which lowers the overall cost of production of diamonds.
Less emphasis on quality
The share of India in medium and large sized diamonds is comparatively less as when compared with other countries is because of less emphasis on quality. It will have a huge impact on large sized diamonds. Therefore, to remain competitive in the world market Indian businessmen will have to improve the quality of their diamonds.
The labor force in India is less productive as when compared with China, Thailand, Sri Lanka. This may be due to reasons like long hours of work, uneasy work environment and no friendly atmosphere created. The workers therefore are not motivated to work therefore resulting in low productivity. There will have to be an increase in productivity for the diamond sector to flourish.
There is no legal proof of any domestic trade related to diamond transactions in India. Everything in India works on word-of-mouth. There is no legally binding contract between the people who do business. Though payment of a high amount is to be made by cheque many transactions are done with cash.
Lack of standardization
Though India is the largest exporter of diamonds in the world , the diamonds are not standardized. A same size, colour, weight diamond may mean different things to businessmen around the world. The Diamond Trading Company should take steps to ensure that the diamonds are standardized so that the dealers and clients are not cheated at any point of time.
The rate of insolvency is very high in the diamond industry. Payments are not received from clients even after years of expiry of the credit period. There is a gap created. The rich businessmen are becoming richer, and the poor are becoming poorer. The newly entered businessmen are also finding it difficult to survive in the market. One really needs to work hard to earn a living and to survive in the market place.
The leading importer of Indian diamonds is US. This is the only country that has been having a majority share in the world market. The Indians can also explore countries like Europe and Latin America. There is also increasing demand in South East Asian countries. Using advertising campaigns and promotion and marketing can do this.
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One of the major opportunities for the Indian diamond industry is colored diamonds. The clients now prefer colored gemstones and diamonds instead of the regular white color. Even other countries in the world are looking up to India for supply of colored diamonds. They are the latest trend in the market.
Scope in domestic market
Since diamonds are expensive they seem to be possessed by the richer section of the society. The lower class prefers gold jewelry. They consider diamond and risky and very expensive and very hard to handle. Therefore the other classes can be made aware of the benefits of diamonds by advertising and promotion campaigns.
Outsourcing of diamond jewellery
The retailers worldwide have shown keen interest in sourcing diamond jewelry requirements from India because of easy availability of diamonds. It has been over a decade and a half since Indian jewelry manufacturers began marketing their products.
Entry of China and Thailand in the diamond sector
The Indian diamantaire perceives a growing threat from China as a diamond processing and cutting centre. Unless the government backs the industry up. Else, India may lose its status as the world's largest diamond processing centre. An increasing number of diamond processors from Israel and Belgium, and even India, are setting up facilities in China for a variety of reasons.
The reasons range from a cheap and disciplined labour force to high economic growth in the country resulting in a significant increase in potential consumers in the high-income segment within China, and also to the quality of Chinese workmanship which is steadily improving. China has all the strengths of India-cheap economic labour, infrastructure and a welcoming government. It also offers attractive labour union terms and export-friendly policies. While it might not affect an industry that has taken 30 years to grow, it is definitely on the cards. As the industry gets more competitive, companies see themselves becoming increasingly efficient to compete. Companies are finding this impossible in a milieu of strict labour laws that inhibit cost cutting measures such as rationalization.
Another threat to the industry is the recent trade in Conflict Diamonds also called 'Blood Diamonds' which have become the thriving industry's Achilles' heel. Conflict diamonds are those mined and the income from their sale help finance arms buying and funding activities of terrorist groups. The three named areas have been Angola, Sierra Leoneand Congo. A great fear in the industry is that due to a mere 4 per cent of illegitimate trade, the rest might feel immense ramifications. While there is definitely a moral issue to be resolved immediately, there are also other ramifications for an industry that thrives much on consumer perception. This could very well happen to the diamond trade.
Use of child labor
Small boys, sometimes as young as 10 years old, work in hot sheds chiseling roughs which eventually get sold in the fancy shops. Their nimble fingers and sharp eyes enable them to cut these diamonds in remarkable shapes, but while they earn well for these skills many of them find their eyesight getting progressively weaker as they grow older.
India processes small diamonds, using traditional labour-intensive methods. About 1.5 million people are employed in the diamond industry, mostly in the unorganized sector.
Anti social activities and threat of terrorism
Antis social activities are on the rise especially in places like Mumbai. Security has become one of the major concerns for the diamond industry. A loss of a packet of diamonds can cause of a lot of money from your pockets. In recent times there are a lot of robberies happening in broad day light without even anyone noticing it. Therefore there should be an increase in security facilities.
CURRENT SCENARIO THE DIAMOND INDUSTRY
Today, India is the leader in importing, processing and exporting of diamonds. India has a virtually complete dominance in small sized diamonds. India now accounts for nearly 55 percent of world net exports of cut & polished diamonds in value terms, 90 per cent in terms of pieces and 80 per cent by caratage. No other export segment of the country has such a significant share in the world market. India accounts for over 70% of the world exports of cut and polished diamonds in caratage. In other words, roughly 7 out of every 10 diamonds set in jewellery worldwide are from India.
In the current scenario, apprehensions have been expressed in some quarters that a number of the small producers would find it difficult to sustain operations on current margins, which would lead to some turmoil. Industry analysts believe that as the industry matures and takes its next step forward, many of the smaller independent producers may find themselves being absorbed by the larger players. The number of firms may reduce in the process, but not the size of the industry, nor even the levels of activity.
Much has been said about the rising bank debt of the Indian industry and there were a couple of disturbing cases of bankruptcy. Yet overall the industry has ridden out the threat and as analysts point out, with manufacturing on the rise and the number of banks providing finance to the trade on the upswing, it is only natural that debt figures will show an increase as well. What is significant however and a sign of the maturity of the players is the process of self-regulation adopted by the industry, in the form of a pact on trading norms. Signed by all major trade bodies in the country, these will be implemented through a consensus in the trade and interaction with the banks to encourage them to accept these as well has also got underway.
FUTURE OUTLOOK OF THE DIAMOND INDUSTRY
Way back in the mid 1990s, when the Indian diamond industry first claimed its rightful status as the world's largest manufacturer of polished stones, there were more than a fair share of skeptics, who refused to accept what the numbers were saying. Not any more. In fact industry analysts are now voicing their opinion that many of the Israeli sight holders have actually been manufacturing their goods outside the country over the past two years and that Israel was being used only as a transit point in the supply chain.
The entire diamond world knows that India has a virtually complete dominance in smalls, and that the country has for long been the world's leading manufacturer of cut and polished diamonds. But behind the scenes, the India centre has been moving confidently to take over a sizeable chunk of the manufacturing of medium and larger stones from other competing centers, particularly Israel.
Some manufacturers took a step forward in the mid-'90s and entered jewellery manufacturing. India has a definite cost advantage and our strength is diamonds today. Profit margins are also higher in the competitive retail business. Selling cut and polished diamonds yields margins of just 5 per cent to 10 per cent but selling finished diamond jewelery pieces to wholesaler's overseas yields margins of between 20 per cent to 40 per cent. And retailing overseas offers margins of between 40 per cent and 60 per cent depending on the value of the diamonds.
But there are challenges ahead. One is the lack of skilled manpower and technology to create and produce designs for the international markets. The council is hoping to tackle his by setting up a training institute. Indian firms will have to tightly control costs and prices.
ABOUT EROS JEWELLERY
Jewelry is a decorative art & what matters are not the words that can be coined from it, but whether or not it gives pleasure to the wearer and more-so to the spectator. There is a new trend towards branded jewelry, which overrides regional variations. Over and above its design strengths, it is also a quality assurance to buyers, part of the increasing standardization and hallmarking coming into the industry. But in the end, it is the design and innovation that will differentiate in a competitive environment.
Jewelry is a shrewd monitor, reflecting the ups and downs not only of money and fashion, but also political, social & cultural changes. These days in India, there is a great tendency towards expressionism in jewelry. People prefer design-oriented jewelry with a degree of chicness.
Eros Gems has been in this industry since 1986. The company has gradually evolved as one of the leading manufacturer of colored stones having a prominent client base in the USA, to name a few - Cartier, Tiffany, Movado and a couple of other leading designers of USA. It has a modern manufacturing facility to cut and polish the gemstones with precision as per the requirements of the clients. Throughout its history, the company has emphasized on its competitive cost structure, high-quality & fine craftsmanship, its distinctive styles, and most importantly, its top-rated service to the company's valuable customers. After a substantial experience in the industry Eros Gems decided to make a foray into jewelry manufacturing and then came into existence its subsidiary "Eros Jewelry".
Eros Jewelry has a strong team of more than 50 proficient designers who add hundreds of unique designs every month. There work is bold, vibrant, intriguing & wearable. It represents the total commitment of a vital and exuberant artist. Some of the jewelry is simple too. But of course, simplicity does not preclude expressiveness.
Parent Company: Eros Gems
Head Quarters: Jaipur
No. of Outlets: 125 to 200 stores country wide and 15 outlets in UAE.
No. of Designers: 50
Founder and Chairman: Abhay Godha
Managing Director: Kapil Bagga
Gifted with creative powers, designers transcend abstraction through forms, colors, and shapes, to metamorphose a rock into a piece worthy of a name, which will survive eternally. Exotic flowers & whimsical objects come alive in the fancy jewels that we have created. We have skillfully wrought our jewelry with a profusion of colored stones, encased in cascade of various motifs.
The inner vibrancy of these stones comes from a formation underground that takes over 500 million years. Their goal is to unleash this brilliance & to bring it to the surface with the appropriate cut and setting.
The jewelry is manufactured under strict quality control at a state of the art manufacturing facility. The gemstones used in the jewelry are cut and polished in house as per the design specifications of the ornaments.
There is probably nothing more representative of the twenty first century culture than design. For it stands between art and industry, between esthetic aspiration and commercial concern, and is one of the major driving forces in that process of simplification of form and search for elementary beauty that has proved to be one of the outstanding conquests of the contemporary age. We have tried to make jewelry for you under the aegis of absolute beauty. 'Absolute' because such beauty is universal and timeless. It is everywhere, for everyone, in every color.
Eros Jewelry has used some of these fascinating, colorful and brilliant rocks to create set jewelry for the woman of today. We have used various different types of gemstones that make our jewelry mesmerizing and dazzling. Some of them are Diamonds, Tourmalines, Sapphires, Garnets, Topaz, Opals, Quartz, Cat's-eye, etc. All the stones are studded in 18 karat gold and the quality of the stones used is among the finest in the international market.
Gone are the days when a piece of jewelry only exchanged hands for investment cash. No longer is jewelry hoarded in ugly gray chests to meet the requirement on a rainy day! With the advent of wearable jewelry into the world of fashion, there comes a need to have designs that are truly remarkable. These designs require to be trendy and extremely wearer friendly. Eros intends to look after the needs of the segment that truly loves indulging in innovative type of jewelry. A national brand with international standards, that focuses on exquisite colored stones studded jewelry with designs that employ exceptional quality of colored stones to spell sophistication.
The Eros collection is the result of many an inquiry into the lifestyle and needs of today's woman. Eros has an exclusive range of pendant earring set a choice so stunning , you'll have a tough time selecting your Eros collection because of its absolute timeless elegance, cosmic, sublime and Zen like qualities.
Enriching the aspirations of today's generation, Eros Jewelry has been created for discerning clientele looking for sophisticated contemporary jewelry. Jewelry that is trendy, yet without losing sight of classic styling and attempting to attain the ultimate in jewelry.
JEWELLERY IS not only a pointer to the lifestyle of an individual but also stands testimony to the social, political and cultural changes of a particular era. Today, the concept of wearable jewellery has pushed many big business houses to venture into this field . So, it is only natural that Eros Gems, which has been in the coloured stones business for the past 17 years, has also plunged into manufacturing trendy jewellery through its subsidiary, Eros Jewelry.
Within six months of launching in the U.S.A., the Jaipur-based company, which boasts of clients like Cartier, Tiffany and Movado, launches its jewellery in India too "because Indians have a high purchasing power and they love jewellery," says Kapil Bagga, M.D., speaking for Abhay Godha, founder chairman of Eros Gems. One more feather in Eros' cap is its tie-up with NIFT where "we tried to custom-make the jewellery as per the creations designed by the students."
Eros Jewelry has a strong team of more than 50 proficient designers who add hundreds of unique designs every month. There work is bold, vibrant, intriguing & wearable. It represents the total commitment of a vital and exuberant artist. Some of the jewelry is simple too. But of course, simplicity does not preclude expressiveness.
The inner vibrancy of these stones comes from a formation underground that takes over 500 million years. Our goal is to unleash this brilliance & to bring it to the surface with the appropriate cut and setting.
Eros currently is having over 125 dealers spread all over the world with 50 designers displaying more than 20,000 dazzling designs.
The jewelry is manufactured under strict quality control at a state of the art manufacturing facility. The gemstones used in the jewelry are cut and polished in house as per the design specifications of the ornaments. The company guarantees its customers high-quality, timeless designs, and exceptional customer service, backed by its unblemished reputation in the gemstone and jewelry industries.
Slowly but surely, jewelry is evolving from its earlier concepts, from an investment and a language of symbols to a statement of its wearer's needs and her personal style. Those needs come from the demand of everyday life: functional jewelry that can be worn at the work place or is more appropriate for the western-style garments that she is likely to wear. It is part of her own perceptions about herself and her aspirations rather than an external social identifier of her roles as wife and mother.
Eros Jewelry has used some of these fascinating, colorful and brilliant rocks to create set jewelry for the woman of today. The company uses various different types of gemstones that mak jewelry mesmerizing and dazzling. Some of them are Tourmalines, Sapphires, Garnets, Topaz, Opals, Quartz, Cat's-eye, etc. All the stones are studded in 18 karat gold with Diamonds (VVS, VS Quality) and the quality of the stones used is among the finest in the international market.
SEGMENTATION AND TARGETING
Eros has designed their jewelry keeping in mind the 'Woman of Substance'. The Woman, who knows her responsibilities and her various roles in the society, and performs them with grace and immense strength. These colorful stones worn by such women will reflect not only their modern state of mind and classy taste but also their inner beauty and magnificent splendor. Clearly, adorning such elegant jewelry is celebrating womanhood.
"We got the first-mover advantage," says Eros Stones managing director Abhay Godha, who introduced the Eros line of branded coloured stone jewellery five years ago. "It was an idea much before its time," he says, "but I believed in my product and so I took the plunge. I decided to start manufacturing branded coloured gemstone jewellery when I saw on a trip overseas, my gemstones set in beautifully crafted branded jewellery. I thought to myself - 'Why can't I try making such jewellery for Indian buyers?' I felt that branded jewellery would go down well with the youth segment. I could make jewellery to flaunt and not for storage in a vault."
Boasting of 15 outlets in most of the UAE's prestigious malls and shopping centres, the Dubai-based jewellery company Liali Jewellery becomes Eros Jewellery's first retailer to be appointed outside India, and will market its large range of exclusive natural gemstone jewellery.
Uphill For Coloured Gemstones. For Eros Stones the transition was seamless, since the company traded and manufactured coloured gemstones (70 per cent of the company's business constitutes exporting polished coloured stones) and had easy access to them. But launching a branded jewellery line wasn't easy. Godha says, "The launch was a struggle. Consumers don't mind paying a premium for diamonds or gold, but mentally they are still unprepared to pay a mark-up for coloured gemstones. Also, there was a huge lack of public knowledge about many coloured gemstones."
Eros jewellery is also being exported to the Middle East, the US, the UK, and Japan. The product sells in the Rs.10,000 ($253) to Rs.600,000 ($15,222) range, with price points up to Rs.60,000 ($1,522) being the most popular. Priced in the range of Rs. 20,000 to 50,000, Eros jewellery caters to today's woman of substance in the age group of 18-40 years. "We are trying to give women things which she can wear with both traditional Indian outfits and also western outfits" says Bagga. The 50 designers exclusively work with the company to create 200 new designs each month, lend an Indo-western/ fusion touch to the jewellery and also ensure that exclusivity in designs is maintained.
Godha and his team launched an advertising campaign a year later to publicly introduce their brand. The campaign featured film star and youth and glamour icon Karisma Kapoor as brand ambassador and targeted the specific consumer group the brand was after. According to Godha, "Eros celebrates colourful moods and moments and our intention is to make jewellery which can be used to accessorize outfits." Today Eros has a national footprint with over 125 dealers all over the country. Set with a variety of stones like tourmaline, blue and white topaz, smoky quartz, amethyst, blue and black onyx, citrine, corals, pearls, and diamonds, the brand's 50 designers bring out 20,000 designs a year to cater to an India-wide selection of consumer tastes.
Eros also provides a booklet educating the consumers about the variety of stones, their origin and various processes like heat treatment that might have been used.
Eros even have buyback schemes. Eros offers 70 per cent of the purchase price no matter how long ago the product was bought and will pay hard cash if the customer wants. "We get only two per cent of our products back," says Godha.
Godha feels the choice of colours is important. According to him, Indians like rhodolites, garnets, blue topaz, citrine, multi-coloured tourmalines, turquoise, corals, rubies, emeralds and pearls. "We offer a variety of colours by studying the market. Currently, the fascination is for jewellery with good quality diamonds along with coloured stones." So the company has introduced an element of diamonds in their coloured stone jewellery. Although that has increased the cost of jewellery, people don't mind paying the extra cost. But the company does have competition in the local market from smaller manufacturers who make and sell jewellery at a lower cost and those who make copycat designs claims Godha.
Another striking aspect of the accessorisation of jewellery is the promotion and marketing of these aspirational brands. Unlike the traditional market where the drivers existed in socio-economic mores, fashion accessories need an extra push to consolidate their position. In a conventional market, occasions like engagements or festivals by themselves draw customers towards the jeweller. However instead of opting for generic campaigns, the players in the 'non-traditional' segment need to formulate and fine-tune their unique promotion strategies. The prospective buyer for them hails from the young and upwardly mobile working class in metros and mini-metros, which, some have discovered, can be tapped through aggressive advertising and event promotions.
"We will advertise in a few of the up-market women's and in-flight magazines and promote the brand through events that attract influential and powerful women." Abhay Godha of Eros Jewellery agrees, "Our idea of having a celebrity (Karisma Kapoor) endorse our brand, has given a face to our collection. We advertise in all leading lifestyle magazines and newspapers and our celebrity endorsement has built up such a high brand recognition that consumers just see the advertisement and know it is Eros without even reading the copy.
Universal and unique designs are the company's forte which makes its jewellery appealing to women the world over. They have ensured that their jewellery is affordable to a large extent (to a large segment of the society) by avoiding many middlemen in the intermediary stages. And, it is Eros all the way - right from sourcing the stones from the mines to cutting and polishing, and finally crafting them into beautiful pieces.
Each beautifully crafted piece of jewellery, inspired by nature, its myriad colours and themes, is aesthetically packaged in an imported wooden box and comes with a certificate, a silk cloth with exquisite embroidery. "So, what you get ultimately is quality stuff and value for money," vouches Bagga. The jewellery is likely to be available at major lifestyle stores shortly.
Liali Jewellery is appointed as UAE's retailer for reputed Indian brand, Eros Jewellery
Liali Jewellery, leading local retailers of branded and customised jewellery, has been appointed as the first UAE retailer for Eros, one of India's top brands of natural gemstone jewellery.
The announcement was made by Liali Jewellery, in the presence of Bollywood actress and Brand Ambassador for Eros Jewellery, Karisma Kapoor at The Bride Show Dubai 2006, the Middle East's largest wedding industry event being held at the Dubai International Exhibition Centre.
Praising the brand, Karisma Kapoor said: "What I like most about the Eros Jewellery collection is that it does not limit itself to gold or diamonds but ventures into designing pieces with a wide variety of quality gemstones that are appropriate for any occasion or mood. The appeal of the Eros Jewellery brand lies in its combination of Indian and Western design and in its universal and timeless beauty, which makes it popular among the young and the old."
Anuraag Sinha, Managing Director, Al Liali Jewellery said: "We are honoured at being chosen by Eros Jewellery to retail its collection in the UAE. This will further strengthen our jewellery collection and widen our client base among the Arabic and Asian community."
Liali Jewellery retails premium jewellery brands including Vivien Westwood, Green G, Miluna, Tirisi, Umi Pearls and Liali Memories. It also retails customized gold, diamond and pearl jewellery and designer timepieces that are popular for all occasions.
Bahrain based Devji recently announced that they would be showcasing two new jewellery brands under the umbrella of Devji Jewellery and Watches - 'Shobha Asar' and 'Eros Jewellery' in Jewellery Arabia 2006.
An Indian Brand, which can make big in the global market, is Tanishq from Tata Group of Industries. Tanishq is India's largest, most desirable and fastest growing jewellery brand in India. Tanishq today is India's most aspirational fine jewellery brand with an exquisite range of gold jewellery studded with diamonds or colored gems and a wide range of equally spectacular jewellery in 22Kt pure gold. Exquisite platinum jewellery and designer silverware is also part of the product range.
Though they faced with many difficulty in the early stages they for about six years they then came with up with good strategies The Tanishq strategy for the coming couple of years relies on two things -increasing penetration in the domestic markets and going abroad in order to diversify its revenue portfolio.
To push penetration in other markets, Tanishq will use the 'shop-in-shop' concept that it already does in 50 stores across different West Asian markets. "This reduces distribution costs. Also, for the consumer it remains a Tanishq store and helps us get a foot into the market.
Their main core competency is in designing a wide range of products. They were the first to come up with the idea of karat meter, which proves the quality of the gold, to win the trust of the customer.
The Gems & Jewellery industry
The Gems and Jewellery (G&J) market essentially comprises of sourcing, processing, manufacturing and selling of precious metals and gemstones, such as, Gold, Platinum, Silver, Diamond, Ruby, and Sapphire etc. The G&J market is a significant contributor to the Indian economy, based on the size of the domestic market and through its contribution to the country's exports. India is the largest consumer of gold (around 20 percent of global consumption) and also the largest diamond processor (around 90 percent by pieces and 55 percent by value of the global market.
India's G&J industry is highly unorganized and fragmented with 96 percent of the total players being family owned businesses. The gold processing industry has around 15,000 players, with only 80 having revenues over USD 5 million. India is also home to around 450,000 goldsmiths, 100,000 gold jewelers along with 6,000 diamond processing players and 8,000 diamond jewelers.
The value chain of the industry starts from sourcing and mining of the metals and extends to jewellery retail. While India is not a major miner of previous metals and stones, the country's inexpensive and well skilled workforce makes it a world leader in processing of diamonds. The country's jewellery retail sector is also expected to evolve with a shift among consumers towards branded jewellery, driven by greater quality consciousness.
There are a few major players in the G&J segment, with Rajesh Exports being the most dominant name. Other key players in the field include Gitanjali Gems, Suhashish Diamonds, Su-Raj Diamonds, Vaibhav Diamonds and Tanishq. Many of these players are focused on developing strong brands, large retail operations, strengthening their core manufacturing operations and building a strong international presence.
India's large population and rapid economic growth offer significant opportunities for growth of the industry. The emergence of jewellery retail chains provide customers with convenience and assurance of quality. The entry of foreign players is also likely to increase competition and provide consumers with greater choice. Apart from the above, there are other factors that contribute to a favorable outlook for the industry.
Evolution of Tanishq
Titan came into existence in July 1984, when the Tata Group joined hands with the Tamil Nadu Industrial Development Corporation (TIDCO) to make a foray into the watch industry.
Titan started manufacturing jewellery watches and jewellery in 1994. It set up its fully integrated Rs. 400 million-jewellery plant in Hosur. The plant had the capacity to manufacture four tonnes of gold in a year. Titan launched these products under the brand name of Tanishq, in 1995. The name Tanishq, a blend of two words, 'tan' (body) and 'ishq' (love), was coined by Xerxes Desai, the Vice-Chairman and Managing Director of Titan.
To change its image from a watch manufacturer to a fashion accessories manufacturer, Titan was renamed Titan Industries Ltd. in 1995. Titan scaled the capacity of its Hosur plant to 4.18 million units in 1996 to meet the domestic and international demand. From the late 1990s, Titan's commitment to the jewellery business increased.
When Titan launched Tanishq in 1995, the jewellery industry in India valued at Rs 40,000 crore was mostly unorganized, with around 3.5 lakh players. Before 1992, only the Metal and Mineral Trading Corporation and the State Bank of India were allowed to import gold. In 1992, as part of economic liberalization, the government abolished the Gold Control Act of 1962, allowing free import of gold. In 1993, private companies were allowed to enter the hitherto restricted gold and diamond mining industry. Foreign investors were allowed to hold up to 50% equity in mining ventures.
In early 1991, the Bangalore based Peakok Jewellery Pvt. Ltd., (Peakok) was incorporated and Mahesh Rao (Rao) was appointed director. Peakok realized that the Indian consumer's relationship with gold jewellery would grow beyond an investment need towards a lifestyle and personality statement.
In 1996, within the Peakok fold a new brand of 18-carat gold-based jewellery called Carbon was launched. In 2000-'01 Carbon's focus had always been to move jewellery from the vault to the dressing table and bring the selling of jewellery out of heavily guarded jewellery stores. This was achieved by persuading a few lifestyle stores to add branded jewellery to their vast array of products. Besides selling from lifestyle stores, Carbon also sold its products as gift items over the internet. Like Tanishq, Carbon laid emphasis on design.
Most of its designs were contributed by students at the National Institute of Fashion Technology (NIFT) through the diploma programme which the company sponsored. In addition, Peakok's team of six designers, (headed by Rajeswari Iyer, an alumnus of a German design school who had worked in the U.K., Germany and India) turned out around 180 to 200 styles in a year, with 75 designs per style.
At any point in time, there are around 600 designs of Carbon on sale. The creation, manufacture and marketing of Carbon was different from the making and selling of traditional jewellery.
It is made available at `shop-in-shop' outlets in large lifestyle stores (such as Shoppers Stop, Ebony, Globus, The Bombay Store, Lifestyle and Taj Khazana) and some premium boutiques (such as the Helvetica in Chennai).
Carbon products were priced between Rs. 2,750 and Rs. 20,000 per piece. While the cost of traditional jewellery was negotiable, the cost of Carbon items was fixed and nationally uniform.The brand is available at 50 outlets in 23 cities.
Gili launched a collection of traditional Indian ornaments made of 18-carat gold. In 1999, the Gili Gold range was introduced. This range included rings, pendants, earrings, necklaces and bangles made of 24-carat gold. All Gili products came with a guarantee of diamond and gold quality.
Gili distributed its jewellery priced between Rs. 500 and Rs. 40,000 through lifestyle and department stores across the country to increase accessibility among its target segment, the 15 to 30 age group. Gili distributed its jewellery priced between Rs. 500 and Rs. 40,000 through lifestyle and department stores across the country to increase accessibility among its target segment, the 15 to 30 age group.
The collection was promoted at college campuses with banners, pamphlets and a few advertisements targeted at teens. Gili soon realized that just pushing its product was not enough; it also had to customize its products for special occasions. Following this, it launched a Diamond Heart Collection specially designed for Valentine's Day. This collection consisting of tiny, heart-shaped diamond jewellery was well received by teens. Special packaging, catchy advertising and extensive press coverage contributed to the success of the collection. Gili also made special promotional offers during festive seasons like Christmas and Diwali. Having captured the low price point market of Rs.2000 to Rs.10, 000, the company is focused on penetrating the premium market of customized jewellery. For this Gitanjali jewels opened a jewellery salon, Gianti, to provide customized jewellery to clients in India.
4 P's of Marketing
* PRODUCT VARIETY
Tanishq today is India's most aspirational fine jewellery brand with an exquisite range of gold jewellery studded with diamonds or colored gems and a wide range of equally spectacular jewellery in 22Kt pure gold. Exquisite platinum jewellery and designer silverware is also part of the product range.
Tanishq designs and manufactures jewellery that is breath- taking, contemporary and yet has a tint of tradition. It produces 22 karat pure gold earrings that come in various shapes, sizes and designs. Some earrings are embedded with precious stones or colour gemstones. These jewellery sets are overwhelming and could prove to be apt for occasions such as marriage, festivities etc. Furthermore, they also make bangles, chains, nose pins, pendants, finger rings, Mangal Sutras etc. They also produce products made from silver such as deity idols etc. Recently, Tanishq has started producing diamond jewellery that are affordable and stunning. The diamond jewellery include collections such as: All Day Diamonds, Aria, Dewdrops, Tanishq Solo, Dancing Diamonds etc. These collections come with a certificate of authenticity that states the karatage, color and clarity of the diamond.
Consistency in delivering on their promise - Tanishq promises superior quality jewellery with purity in gold. It is the first and only jeweller that guarantees thepurity of its gold jewellery and certifies the quality of the precious/semi-precious stones in writing.
They claim and deliver the exact carats and weight that they promise. Impurity in gold and not delivering what was promised is one of the main problems the consumers face when going for gold purchase. They eliminated this and have built its brand in trust. Tanishq now stands for quality and purity. They even have gold meters where one can check the purity of gold. Thus it has established itself as a highly ethical player in a market that was rated as having the highest incidence of under karatage (Bureau of Indian Standards).It maintains its quality standards in all its products wherever they are sold. This shows that they have a resolute core purpose. This is what they will have to maintain even when they global. They have the right range of products for the different markets across the globe. Only they have to remember their differentiating factor. The differentiating factor for Tanishq will be the experience and quality they will be giving the consumers when they come to the store.
Widely acknowledged as a design leader, Tanishq is known for its ability to develop specialized design collections.
Each piece of jewellery is designed by a team of award winning designers. In fact, Tanishq is the only jeweler to have a full- fledged design studio with one of the largest design teams in the country. Every product at Tanishq is painstakingly crafted to perfection. Diligent care and quality processes ensure that the Tanishq finish is unmatched by any other jeweller in the country.
Tanishq was recently adjudged the Most Admired Jewellery brand (for the third consecutive time) in India at the Images Fashion awards 2004. It has also been judged as the Images Retailer of Year in the fashion category. Positioned as '9-to-5 jewellery', the collection is stylish and modern and is designed to suit all forms of attire, western and Indian, casual and formal.
* BRAND NAME
"Jewellery is one of the last great commodity frontiers in India; it has remained so because this market is very fragmented, very unorganized. Tanishq has successfully taken on the challenge of transforming this frontier into a reliable consumer space by bringing to it all the virtues and benefits that branding offers".
Harish Bhat, CEO, Tanishq.
Tanishq was established in 1995 and within ten years it has become the largest and most desirable brand in the jewellery segment in India. They have constantly introduced new offering to their consumers and have come up with new innovative ideas. The surveys showed that awareness of the brand was quite high. The company believes that young urban women, with independent incomes, are looking at branded national jewellers. The brand believes that accretion to this segment is clearly in its favour due to the modern contemporary image among women.
One of the company's most important initiatives was customer service enhancement. Tanishq launched a direct consumer contact program and conducted surveys to monitor store walk-ins and footfalls and percentage of repeat customers. The company also kept the entry-level price as low as Rs 600 (for a pendant) and offered a range, which far exceeded that offered by any other jeweler. All Tanishq outlets gave a 100% return guarantee on its brand of jewellery and also exchanged other jewellery after deductions depending on purity. A customer satisfaction measurement program was started with the help of Customer Satisfaction Measurement Management (CSMM), an associate of IMRB. CSMM tracked customer satisfaction parameters for Tanishq on a quarterly basis.
This gave the company the benefit of benchmarking against local and international players and also aided in improving repeat purchases. As a result, it was able to directly link the remuneration of franchisees with customer satisfaction.
Since they have many stores across the country they give guarantee on their jewellery and also offer to repair it free of cost anywhere across the country. They have excellent after sales service and they have been committed in providing good and honest service.
They welcomes you to exchange your old gold jewellery for new designs. To ensure you get the right valuation for your old jewellery, use scientific, reliable and transparent processes including testing it with the Karat meter.
The Tata Group has promoted Tanishq as a jewellery store brand, which competes with close to three lakh traditional jewellers who dominate the domestic market. It has launched new collections at a quicker rate than its competitors, and conducted marketing promotions and fashion shows to enhance the shopping experience of consumers. Given the diverse nature of Indian ethnicity, Titan made the designs more ethnic to satisfy the tastes of all regions. Titan transposed designs by stocking Bengali designs in Delhi, Keralite designs in Tamil Nadu and typical designs from Tamil Nadu in Bombay in order to appeal to a variety of people.
'Concept' stores, the first of which, costing Rs 10 crore, opened in Kolkata . The idea of such a store was to harmonize the tradition of the past with the modernity of the present.
In 1998, it launched the corporate gold gift scheme - 'When you want to say thank you, say it in gold'. In 1999, Tanishq delivered gold coins worth Rs. 20 crores to Maruti Udyog Ltd., to be given away as gifts to Maruti car owners. By 2001, the scheme accounted for almost 5% of the turnover and over 30 corporate clients like Coca-Cola, the UB Group, Whirlpool, TVS Group, Ceat and Liberty shoes. In early 2000, it made miniature gold cars for Hyundai Motors to be given to select dealers.
Tanishq has also endeavored to be part of every occasion in an Indian woman's life through festive promotions, customer contact programmes as well as through Anuttara, Tanishq's exclusive consumer reward programme etc. Tanishq provides Gift vouchers in various denominations for gifting your friends and family.
One of the company's most important initiatives was customer service enhancement. Tanishq launched a direct consumer contact programme and conducted surveys to monitor store walk-ins and footfalls and percentage of repeat customers. The company also kept the entry-level price as low as Rs 600 (for a pendant) and offered a range, which far exceeded that offered by any other jeweller. A customer satisfaction measurement program was started with the help of Customer Satisfaction Measurement Management (CSMM), an associate of IMRB. CSMM tracked customer satisfaction parameters for Tanishq on a quarterly basis.
In 1999-2000 the communication and promotion budget was increased from Rs. 65 million to Rs 100 million in 2000-01. A majority of this was spent towards advertising, while a portion was also earmarked for promotions tailored to match regional preferences. For instance, in New Delhi, which was Tanishq's single largest market, substantial promotions were carried out. The Rs 100 million was split into four parts, comprising national-level spends (both electronic and print media), regional budgets, direct mail and research. For the first time, Tanishq initiated a long-term media plan, aiming to give the brand a round-the-year presence and enhance awareness.
A customer survey revealed that despite its high-blitz ad campaign, many didn't know what Tanishq was about, others found it too expensive and some felt that the product was not for people like them .So, Kurian and his team then decided to launch the fifth anniversary celebrations of Tanishq that would offer discounts to customers and induce them to come to the store. The ploy worked and they had customers waiting for the store to open.
Ad campaigns also started to list out the products that Tanishq had. Bracelets, rings, chains, pendants were explicitly mentioned in each ad. A range starting at Rs 399 was launched.The aim was to bring down the price barrier significantly. Collections for the working women and a new set of contemporary designs were brought into the stores.
Aria, for seven stone diamond jewellery, Hoopla, focused on diamond studded hoops and Collection-G for lower priced gold jewellery with an interesting twist are just a few lines that have come out of the Tanishq's stable in the last three years.
One of Tanishq's more innovative ideas is to offer special schemes during various festivals. Tanishq has also initiated a loyalty program called the Golden Harvest Savings Scheme, which offers buyers the benefit of getting more jewellery than what they have paid for. The scheme allows consumers to plan future purchases in advance and pay for them in easy installments.
Exchange offer - change impure gold for pure 22 kt gold - attracted more people to the stores. It is estimated that roughly 2.85 lakh customers bought from - and close to a million people went through - 53 Tanishq stores across 41 cities. Since the European designs in 18-carat gold did not find any takers in 1997, Tanishq introduced 22-carat ornaments. After hitting six countries in the last four years, Tanishq entered the $57-billion US jewellery market with two exclusive stores, one in Chicago and the other in New Jersey, in the first quarter of 2007-08.
Tanishq jewellery is crafted in one of the world's most modern factories. The factory complies with all labour and environmental standards. Located at Hosur, Tamil Nadu, the 135,000 sq. ft. factory is equipped with the latest and most modern machinery and equipment.
Tanishq reached the century mark as it unveiled its 100th store in Patna at Hathwa Market. Having embarked on the retail journey a decade ago, Tanishq today is the largest jewellery retailer in India. With a strong presence in 70 cities across India, unmatched collections and assured purity, Tanishq has quickly become the first choice of discerning customers.
Tanishq opened 30 retail stores during FY08, taking the tally to 130 stores. Currently, the average store-size for Tanishq is 1,000-1,500 sq ft. The stores operate on the franchise model.
Tanishq has undertaken several unique retail initiatives keeping in mind the customer demand for a world class shopping experience. As such Tanishq retail identity has evolved over the years to offer large format and concept stores that reflect the brand's philosophy of being "Revitaliser of Tradition".
Design and retail innovation have been the hallmark of Tanishq all these years. Tanishq has constantly formulated an innovative product strategy in this journey in line with the evolving consumer tastes.
Modern retail values and principles in the selling of branded jewellery in India are almost completely the handiwork of Tanishq. The brand has broken fresh ground in retailing by creating exclusive outlets with hitherto unknown in-store ambience and hospitality touchstones.
Following more than 40% percent growth in operations last year, Tanishq will invest extensively during 2008 in marketing and retail initiatives to further develop the market. In addition, Tanishq will build new logistics centres and upgrade existing ones, laying a solid foundation to meet future competition.
Besides catering to Indian consumers, Tanishq has successfully entered key export markets such as the US, the UK, the Middle East, Singapore and Australia. This is testimony to the brand's ability to craft products that meet the requirements of varied cultures and sensibilities.
Tanishq's retail boutiques are temples for the brand and are used as a platform for celebration, be it the launch of a new collection, a new marketing promotion or a festival. This gives Tanishq outlets a unique appeal and consumers an opportunity to heighten their shopping experience.
Tanishq gave complete freedom to the retail outlets to pick up designs, which they thought would sell in their stores. Almost all the outlets stocked the 'best selling' range of designs, which did well across the country.
In fact, industry experts recall a period when plain gold gained space in Tanishq stores at the cost of studded jewellery. "It was perhaps an offshoot of its expansion into mini-metros and other towns where the company thought plain gold will be in more demand. It was not a well-researched move,'' says an industry expert.
It plans to open two pilot stores at Chicago and New Jersey with a retail format of 1,800-2,000 sq ft. Meanwhile, it plans to tap small cities by opening 15 Gold Plus outlets, its jewellery store brand for semi-urban markets. Launched two years ago, Gold Plus clocked Rs 200 crore revenues during FY08. Tanishq has entered the US markets. This is an amazing achievement for Titan Industries," said V Govindraj, Vice President, Tanishq. "Retail is a capital-intensive business. In America, having 1,000 stores is not unusual. Even for niche retailing, 200-300 stores are needed. But in India, although there are several small scale unorganized jewellery markets, Tanishq is the first and only jewellery brand to have organized mass jewellery retail chains across the country. As our company expands, more and more people will be able to share our mindset. Tanishq's retail strength goes beyond its innovative identity and extensive reach. Tanishq has undertaken several unique retail and marketing initiatives like creating purchase triggers like Doctors Day / Professional Day etc that were unexplored avenues in the industry. Following more than 40% percent growth in operations last year, Tanishq will invest extensively during 2008 in marketing and retail initiatives to further develop the market. In addition, Tanishq will build new logistics centres and upgrade existing ones, laying a solid foundation to meet future competition.
Add the world to this. After hitting six countries in the last four years, Tanishq is entering the $57-billion US jewellery market with two exclusive stores, one in Chicago and the other in New Jersey, by the first quarter of 2007-08. S. Ravi Kant, COO (international business division), Titan, says: "We are not looking at the NRI market only. We want to understand the American consumer." He claims that Tanishq's market research team is figuring out the market and a designer who can create new products for it.
Traditional jewellers have been rebranding themselves and are expanding in smaller towns to widen reach. "The emphasis for Tanishq will be on special collections, diamond jewellery and bigger stores of about 4,500 sq ft," Venkataraman said.
Tanishq's team of in-house designers came out with about 3,500 designs based on current trends and the feedback from stores. At least 10% of these designs were changed every quarter and fresh ones were added to the stock.
We have very large collections of pendants, earrings and fingerings in this price range Rs 2000-5000. Tanishq range of products start at an accessible low of Rs. 600 and the range - Solo, Aria, Diva, Hoopla, Lightweights, Bandhan and the most recent, Colours - comprises wearable everyday jewellery which has been designed for the urban working woman.
The Tanishq Valentine's Day collection includes pendants, earrings and finger rings starting from Rs. 2,000 onwards. Daytime's collection of all day diamonds, which starts at an affordable Rs. 1,960. The collection combines traditional motifs in sleek contemporary lines with slight touches of black rhodium. The 'up to 25 per cent' off offer by Tanishq is a unique opportunity. This attractive offer has been introduced to benefit the customers and provide them with the best price and product options. Affordably priced from Rs 2,500/- onwards the Tanishq range of diamond jewellery is the ideal accessory for the customers.This collection is crafted using a special process called electro-forming. The jewellery is targeted at customers who are looking for international designs, wearability and value for money. The new collection starts from a price range of Rs6,000 onwards and available at all Tanishq boutiques across the country.
Tanishq offers gold and gem-set jewellery in over 6000 traditional, western and fusion designs. The Tanishq retail chain currently includes 112 exclusive boutiques in 75 cities, making it India's first and largest jewellery retail chain.
* Market Penetration (Present product-present market)
1. Currently Market Share of Tanishq is 2.9%.So Tanishq has a scope for increasing its market share.
2. Provide EMI by tying up with banks.
3. Find new applications to current users: Increasing the versatility of the product in terms of usage. For example, provision for using pendant as ear-rings, finger rings and vice versa.
* Market Development (Present Product- New Market)
1. Expand geographically: Opening new outlets in new cities and increasing the number of outlets in the existing cities.
* Diversification (New Product- New market)
1. Related: Gold and diamond studded buckles in belts and footwear.
Tanishq has been projected as an impeachable mark of trust by raising the awareness of the people about unethical practices in the jewellery business and then measuring the gold purity by caratmeter.
Tanishq also has been positioned as a branded jewellery of luxury rather than commodity. It moves jewellery beyond investment to the fashion and adornment sector.
* Niche Marketing
After its inception in 1995 focus on exports, Tanishq's designs had been conceptualized for the Western markets and were introduced in India without any alterations. Tanishq positioned itself as an international brand for the Indian elite. The brand was targeted at a niche market (However they later on started targeting the mass marketing since 1997).
* Psychographic Segmentation
Life Style: Tanishq has found that 40% of the Indian women are working and they targeted this segment wth a specific group of products called collection-G, a 9-to-5 jewellery for the working women.
* Geographical Segmentation
Titan realized that, given the diverse nature of Indian ethnicity, it would have to satisfy the tastes of all regions. So, the designs became more ethnic. Titan also decided to transpose designs by stocking Bengali designs in Delhi, Keralite designs in Tamil Nadu and typical designs from Tamil Nadu in Bombay in order to appeal to a variety of people.
Decades of hard work by the founder Mr. govind l. kakadia and two brothers Mr.vallabh kakadia and mr. ravji kakadia led to the foundation of sheetal group which today, stands tall as one of the world's leading manufactures of polished diamonds .a family owned business managed by the kakadia family, sheetal group also employs well qualified professional talent with international exposure.
The Sheetal Group, founded by Govindbhai Kakadia, is now headed by his son, Ajay Kakadia, managing director. This company, formed in 1985, has won several awards for outstanding export performance for cut and polished diamonds in the DTC category, by the Gems and Jewels Export Council and the Ministry of Commerce, India. They have also been graded as Star T
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