Jewellery industry has moved from investment to adornment: CK Venkataraman

Men don’t have many things of personal nature that are high-end. So, jewellery can be made exciting for them as well, C K Venkataraman tells Ritwik Sharma.

In the two decades since Tanishq has been in existence, the industry has moved from jewellery to fashion accessory. What have been the key lessons for the company in terms of product innovation, pricing and retail?

Actually, I would rephrase it. I don’t think it has moved to fashion accessory, which connotes a short-term nature to the product. The term we use is adornment. From investment to adornment, the primary driving need for jewellery was investment or savings, whereas now it’s moving more and more towards adornment. So it’s about the beautification of the person, and that’s what Tanishq has been leading from the beginning.

Clearly the emphasis on new products and innovative collection has significantly increased in Tanishq over the years. The number of new collections that we launch, the number of new segments that we target, the frequency with which we keep offering exciting reasons to the consumer to come again to the showroom, that intensity and width of effort has gone up. It has a bearing on the brand’s stature and wooing power. Simultaneously, in the store the presentation of our collections, the whole set-up keeps changing every two months to target different sections. Third, as they are moving from looking at jewellery as investment or savings to looking at jewellery as adornment customers are willing to pay higher and higher. That thinking has changed with changes in income, attitudes and of course with the company driving new products and collections. So, these are the three big things on product, store and then price that has happened.

Tanishq has created its sub-brands, most recently in men’s jewellery, to cater to different segments. How critical are they to your expansion plans?

We have some sub-brands which are well-established, like Rivaah (wedding), Mia (young women) and now we have Aveer for men. Men do not have too many things of personal nature that are high-end. So we believe jewellery can be made exciting and relevant for men as well, and that is the thought behind Aveer. It is a seed we are sowing for it to blossom in the next few years. It is not critical to our expansion, but it is a critical initiative of the company.

In fashion jewellery, there isn’t yet a strong presence of Indian brands. Do you look at it as an opportunity?

It is certainly a potential category and it’s an unorganised sector. There is no brand actually other than maybe a Swarovski, but it is limited in its reach. Our division is faced with a Rs 300,000-crore market with less than Rs15,000-crore sales. So, our collective vision is fixed towards expanding that much more. There is no plan for us to look at fashion jewellery in that category.

Given that bridal is the biggest market for fashion designers and jewellers, what are your core strategies to cater to this segment?

A commonsensical approach is— we need the right products, we are focusing on some different communities across the country, so all our stores in Kolkata will have a line of typical ethnic Bengali jewellery. Similarly, in Punjab we will have Punjabi jewellery and so on. That’s one part of the product plan. The second is we also have been creating what we call cosmopolitan, national lines of jewellery. They go by different collection names, are rooted in tradition but there is a pan-Indianness to them. We believe there is a national audience for all the collections, similarly brides as well. So this is very central to our strategy—which is the right product for both the ethnic bride as well as the cosmopolitan bride.

The second is substantial width and depth of product range stocked properly in every relevant showroom, the wedding zones which are created in what we call our wedding stores and training given to the staff about how to sell well to the wedding group. We had released a very touching film released on fathers and daughters, TV commercial which builds on their special relationship, and through that film and many other ways to build Rivaah as a strong wedding brand. So, product, stock, stores, marketing are very copybook kind of strategy approaches for building any brand. These are the ones we have been using for the last year and a half now and we have seen exceptionally good results.

How has the implementation of the goods and services tax impacted the industry? How did you prepare for and benefit from it?

A lot of the mid-size and mid-market jewelers who have been operating in an unregulated kind of scenario for decades, but GST brings everything into the forefront, there is complete trace that is now available. The way of working of the medium and small jewelers has been made quite complicated because of GST and they are clearly on the back foot trying to cope with all that. And we see therefore an acceleration of the organizing of the industry and other categories which are probably in a similar situation. Therefore, some kind of a tailwind blowing behind the organised sector, and we being the clear leader benefiting from this. There is nothing for us to specially prepare for it. It's just that we can capitalise on it as it comes about.

Any trends or opportunities you want to point out?

We have a very high confidence about the next five to 10 years. This whole, on the one hand, more and more and more women are looking at jewellery more as adornment and less as investment or savings. That is clearly pushing them in the direction of a brand like Tanishq. The second is, things like demonetisation, GST, money laundering act, hallmarking which will happen sometime in the near future, they are all putting substantial pressure on the unorganised parts of the industry and making them less competitive. Those are sending regulatory tailwinds behind us. And given that our market share is pretty low for the next five-10 years we expect a very good momentum in our growth, customer acquisition, market share gain, overall excellence in many areas.