Você está na página 1de 41

The Retail Revolution

1st India Gold Conclave 19th July 2008 Chennai

Flow of presentation
Background of Indian jewellery Industry Changes taking place within the Industry Coping with these Changes Gazing at the Future Future requirements for the Industry Some example from Tanishq

How big is the jewelry market in India?

Relative Size of Indian Consumer Markets


111.87 Telecom 75 Apparel Watch 0 9.6 8.6 2.5 50 100 150 Series1 88

Jewellery is amongst the largest and most broad based consumer markets in India

Rs Thousand Crores

Background
The Indian jewellery Industry is one of the largest domestically (and in the world) and has some unique characteristics Recent Changes in the Lifestyle goods industry and the diamond industry have created some opportunities and challenges The family jeweler segment is the largest segment of the market and hence most likely to be impacted by these changes If the industry needs to initiate changes at the firm or Industry level , the leaders need to agree on the challenges facing them and the strategies needed to cope with them

Indian Jewellery Industry


Market Size

Fourth largest consumer market in the world Jewellery Market Size: Rs75,000 crores Diamond jewellery: Rs10,000 crores Largest market in terms of volume of gold India accounts for more than 22% of the total gold used for jewellery purposes
Growth

Gold jewellery Market Growth: 8-10% Diamond jewellery Market:18%-20%


2006 data

Per Capita consumption


170 123 Italy USA Japan China 12 10 India

180 160 140 120 100 80 60 40 20 0

115

Per Capita consumption in US $

What s Changed
Gold as a share of wallet is decreasing in the younger generation. Traditional jewellery is still the dominant design pattern while contemporary styles are emerging fast Although guarantee of the retailer is important in ascertaining quality, hallmarking is gaining acceptance In the past choice of stores used to be 1-2 stores, but customers now look at 4-5 stores for range and choice of jewellery The main occasions to buy are still marriage and festivals Customers in the high value category are becoming more informed because of exposure to media and fashion trends

ndian Retail Market -2006 Retail Segments Organised retail making a Food & Grocery Clothing,Textiles & Fashion accessories Jewellery Catering Ser ices (F&B) Consumer Durables, Home appliances/Equipments Pharmacetuicals Furnishings, utensils, furniture - Home & Office Entertainment obile Handsets accessories & ser ices Footwear Books,Music & Gifts Watches Health & Beauty care ser ices TOTAL Valuedent Rs Crores 743900 113500 60200 57000 48100 42200 40650 38000 21650 13750 13300 3950 3800 1200000

Fragemented Value Chain


MM C G ld B nk In di i Ind ul nd n J b w k

Di I

L g J w ll y M nuf u l ll

+ ul C in g y ul

O n M k Di nd

Mining ni

ig H ld

Ind nd n +,/ , B in B nd d u l ing ll

Share of Organised retail in the market


95%

Famil je elle 5% ani e Re aile

2005

Despite its large size jewellery retail is unorganised and very fragmented

US Retail Scenario

ndependen s 53% 49% 49% Disc un s res 23% 20% 4% 1987 24% 20% 7% 1992 22% 20% 9% 2004 eweller Chain s res N n s re Re ailers

Organised retail making a dent


% Organised Retail 50% 40% 30% 20% 10% 0% Watch Footw Clothin Books, Health Consu Furnis Mobile Caterin Others es ear g,Texti Music & mer hings, Hands g 46% 38% 19% 13% 11% 10% 9% 8% 7% 11%

% Organised Retail

% Organised Retail

Industry standards are set


Diamond Trading Company (DTC) World Gold Council (WGC) Platinum Guild International (PGI)

How they aid organised retail


Educating the customer about different kinds of precious metals, stones and jewellery as a whole Creating Brand pull in customers Promoting jewellery by increasing usage and appeal occasions Putting a good vendor base to ensure continuous supply of products and better service for the customer Positioning jewellery as a lifestyle product rather than a traditional product Responsible for the emergence of a jewellery industry value chain

Value chain redefined

Merchandising & Design

Manufacturing

Marketing

Retail

Unlik di i n l n g u u , l

w l

in f

w i liz i n

ingl wn ging in indu

Design Differentiation becoming the USP


Traditional industry relied on Karigar skills Now, More emphasis laid on formal design training in jewelry category especially by the organized players Design Training in NIFT, SNDT,GIA, JDTI Players like Tanishq, Ganjam, TBZ have specialized Design Studios which have won laurels at international forums as well

Manufacturing
Hallmarking - Standardization in Material quality is fast becoming a pre requisite especially for Gold jewelry In case of diamonds, Increased awareness of diamond quality ( 4 Cs) Special EOU in hubs like Mumbai (SEEPZ) which supply to stores across the world but face stiff competition from Hong Kong and China Platinum has few manufacturers in the country in comparison to Gold and Diamonds

Marketing
Creating Newer opportunities to buy jewelry Festivals like Akshay Tritiya, Occasions RakshaBandhan, Valentines Day etc like Mothers Day,

Fashion campaigns in vogue- Tanishq s Fashion Earrings, Colors of royalty Creating a desire in the Indian Woman to buy jewelry for its design value/for accesorisation/ to make a statement about her personality.

RETAIL
Retail Seduce the consumer in the retail space as competition is not only within jewelry category but categories like electronics, wellness services and luxury items

Evolve a distinct retail identity in terms of product, store look and customer experience
Trend of the speciality Jewellery markets/ malls Increasing traditional players renovating/refurbishing store spaces Concept of strong retail brand in jewellery industry gaining strength

What else is changing?


Disposable income rising faster as the economy is growing Rs One Crore Per Anum Income households among the fastest growing population segment in the country This Trend also visible further down the pyramid

Mapping of India s Income classes


Classes
Rich (above 2.15 lac) Consuming (0.45 2.15) lac Climbers (0.22-0.45) lac Aspirants (0.16-0.22) lac Destitute Less than 0.16 lac

1994-95
1million Households 29 million Households 48 million Households 48 million Households 32 million Households

1999-00
3 million Households 66 million Households 66 million Households 32 million Households 24 million Households

2006-07
6 million Households 75 million Households 78 milion Households 33 million Households 17 million Households

Projected Growth

140000 120000 100000 80000 60000 40000 20000 0


20 05 20 06 20 07 20 08 20 09 20 10 20 11 20 12 20 13 20 14
Indian jewellery market is expected to grow at an overall rate of 8%

Entry of strong players into the jewellery industry


Reliance Big Bazaar Giant Subiksha Metro Bombay stores

Big Bazaar has already launched a gold section Departmental stores like Shoppers Stop have jewellery outlets

New Channels of Distribution


Direct selling

Modicare launching jewellery sales Pantaloon acquiring a 10% stake in Goldiam


E-retailing

Fabmall/Gold Palace starting e-retailing of jewellery

Different stages-Different strategies


Strategies Jewellery is used as a status sy b l Jewelelry as little differentiati n and ad t a e to strategy Local artnershi s are i ortant to succeed isks Loss of customer trust Low customer protection Market maturity

Transition
Mature

Strategies Cost cutting measures adopted by most jewellers Management of the distribution chain Alliances Risks Industry Restructuring Loss of customer trust Time

Consolidated

Fragmented

Strategies Creation of a local brand Use of innovative distribution channels Local alliances

isks Unclear market segmentation Unclear offering Loss of customer trust

Lessons to learn from apparel


Traditionally dominated by small and family run stores Strictly made to order Fashion element and design content minimal Fact Files: Second largest organized sector in the country Total Apparel industry worth Rs 1000 billion with readymade garments worth 300 billion Export of Readymade apparel constitute 46% of total Percentage of apparels sold through single large format stores is 44% India viewed as a hot destination for global retailers

Emergence of big brands and retail outlets, tremendous competition Increasing preference for ready-made garments, with rise in urbanization Increasing importance of Fashion, style and brand management

The rapid growth of the organized retail market was unforeseen in the apparel space, and this is predicted to continue growing the market as a whole

An industry that believed that individual customization that a family tailor offered was irreplaceable, found customers increasingly amenable to picking up off the shelf alternatives, now available in a wide range of design and size

Primarily driven by people who found they had a lucrative domestic market when fighting pitched battles in the export market

What do we need ? Expertise to be developed in..


Areas
Marketing and Brand building Capabilities

Success factors
Identification of valuable target segment and effective positioning Communication of differentiating factors Consistent communication Strong customer relationship management

New Product Development

Strong design capabilities Strong manufacturing support Strong product planning process Strong IT integration

What do we need? Expertise to be developed in..


Areas
Distribution Management

Success factor
Strong retail management capabilities Strong franchisee management capabilities New avenues, e-tailing, mail order catalogue Strong IT integration

Supply -Chain Management

Efficient sourcing and procurement Efficient production & inventory management Efficient logistics management

Service Quality

Store staff reliability, responsiveness, assurances, empathy

Therefore
As the retail boom has arrived in the country, jewelry industry cannot ignore it. Will have to take giant steps so that can meet customer expectations and offer value to the customer which is higher than the material cost they pay for Separation of the ownership from the management in the jewelry industry Need for more specialized people in each of the above mentioned fields Immense opportunities for young professionals from varying fields

The Tanishq Story


Building a successful retail brand

Retail has traditionally been regarded as a sales and distribution channel Brands - in FMCG, durables, fashion categories to dwell on their extensive retail distribution reach But, truly speaking, retail can impact the minds and hearts of customers as strongly as it can reach the vicinity of their homes Because retail can make the magic of brands come alive, in an environment that consumers can experience, feel and touch Retail can deliver the brand value proposition to consumers in a compelling yet cost-effective manner like

Products need to tell a story- Retail Showcase


Retail space can showcase product far more brilliantly than advertising ever can sexy product displays, which completely mesh with brand personality Attractive store windows the alluring play of colour and lights key product features can be emphasized, often dramatically relatively long consumer attention span

BRAND is what the customer sees


Retail space is uniquely positioned to surround the customer s senses with multiple facets of the brand s personality Can deliver visual, audio and olfactory cues in-store visual merchandising music that brings alive the moods of the brand online audiovisuals that inform, excite & stimulate in many cases, even the fragrances and smells that define the brand and draw the consumer

Communication with the customer


Unlike most advertising, retail space permits an interactive process of communication about brand
-

An effective salesperson can communicate brand in a clear, compelling, customized manner

- Catalogs, take-one leaflets, online dialogue counters in the store can further enhance this process of speaking to the customer about key brand benefits - Within the retail space, the customer is captive audience as he listens to you and experiences your brand

Captivate
The first three Ss (showcasing, surround effect and speaking effectively) make the captivating magic of the brand come alive This is truly the moment of truth for every retail brand seduction, leading to consumer choice & purchase Magic, by its very nature, cannot be captured in words in our showrooms, 365 days a year the point of

but we see it

Unanimity in the story- Paheli


Communicate to create brand association and generate interest

TVC Print and Magazine Instore Outdoor

BRAND PROPOSITION- NEW TALES OF TRADITION

Communicating your brand values and your unique proposition to the customer.

Synergy between your products, store,advertising.

CHALLENGE NORMS
Challenge existing norms and wake customers Taking a strong stance in our campaigns Education into why customers should buy into organised retail.

Own an Activity- Anmol Saheli


Seeing ourselves as a complete wedding jeweller was one proposition but communicating the same to the right TG another task. Anmol Saheli- Emotional Bonds talked about rather than hardselling jewellery. Hit the right cord with the right TG and overnight walkins grew and sales as a factor of this.

The best way to predict our future is to invent it

Você também pode gostar