Chapter 1 : Introduction

Till the early 1990s, the average Indian bought jewellery for investment rather than for adornment. Jewellery made of 18-karat gold was not favored as it was considered a poor investment. Confidence in the local jeweler was the hallmark of the gold jewellery trade in India. A jeweler or goldsmith in a local area had a fixed and loyal clientele. The buyer had implicit faith in his jeweler. Additionally, the local jeweler catered to the local taste for traditional jewellery.

However, since the late 1990s, there was a shift in consumer tastes: women were increasingly opting for fashionable and lightweight jewellery instead of traditional chunky jewellery. There was a rise in demand for lightweight jewellery, especially from consumers in the 16 to 35 age group, who regarded jewellery as an accessory and not an investment. The new millennium witnessed a definite change in consumer preferences. Branded jewellery also gained acceptance forcing traditional jewelers to go in for branding. Given the opportunities the branded jewellery market offered; the number of gold retailers in the country increased sharply. Branded players such as Tanishq, Oyzterbay, Gili and Carbon opened outlets in various parts of the country. Traditional jewelers also began to bring out lightweight jewellery, and some of them even launched their in-house brands. However, the share of branded jewellery in the total jewellery market was still small (about Rs. 10 billion of the Rs. 400 billion per annum jewellery market in 2002), though growing at a pace of 20 to 30 percent annually. The branded jewellery segment occupied only a small share of the total jewellery market because of the mindset of the average Indian buyer who still regarded jewellery as an investment. Moreover, consumers trusted only their family jewelers when buying jewellery. Consequently, the branded jewellery players tried to change the mindset of the people and woo customers with attractive designs at affordable prices. However branded jewellery players will continue to face lot of competition from local jewelers. In order to gain market share, they will have to come up with designs that customers want and win the trust and confidence of consumers by hallmarking and demonstrating the purity of the gold used by them.

To compete with traditional players, branded players must also find some way to differentiate themselves. While the success of a particular brand will depend on differentiation, affordability and quality will be a key element in sustaining a brand.

In addition, branded players require focused advertising and astute salesmanship to compete with traditional jewelers. Besides the major brands- Tanishq, Carbon, Oyzterbay, Gili and Trendsmith - several regional players have opened branches to leverage the trust and reputation that they have built up over the years.

Objective of study
The objective to study the A comparative study on the consumers preference towards branded jewellery over non branded jewellery in Mumbai. is to find out 1) The consumers buying preferences 2) The reach of branded jewelers 3) Brand awareness of various brands in the jewellery market Description of problem The scope of study is limited due to the following reasons: 1) Time constraint- since the time span for the project is only 30 days an in depth study and analysis will become a little difficult. 2) Sample size- the sample size of the study is only 51 which would not give a comprehensive result. Many important samples may not be considered at all. The conclusion of the study may not result to an accurate outcome due to the sample size being small. 3) Bound to only Mumbai city - the other limitation of the study is it is limited to only the main suburbs of Mumbai and did not include samples from the smaller parts of the suburbs. The buying behavior of an individual varies from place to place. 4) Awareness- the sample taken and the conclusion drawn can be led to only one side if there is lack of awareness about branded jewellery.

Significance of the study The gems and jewellery industry occupies an important position in the Indian economy and is one of the fastest growing industries in the country. Hence the research conducted would help me 1) Understand the consumers preference while purchasing jewellery 2) How much impact does a brand have on their purchase decision 3) Does price play an important role in guiding their purchase decision

Research Methodology

Research is initiated by examining the secondary data to gain insight into the problem. The primary data is evaluated on the basis of the analysis of the secondary data. DEVELOPING THE RESEARCH PLAN The data for this research project would be collected through questionnaire. A structured questionnaire would be framed as it is less time consuming, generates specific and to the point information, easier to tabulate and interpret. Moreover respondents prefer to give direct answers. Both type of questions i.e. Open ended and closed ended, would be used. COLLECTION OF DATA a) Secondary Data:It was collected from internal sources. The secondary data was collected from the articles, news papers, management books, and the internet. b) Primary data:They were the main source of Primary data. The method of collection of primary data would be direct personal interview through a structured questionnaire. SAMPLING PLAN Since it is not possible to study whole population, it is necessary to obtain representative samples from the population to understand its characteristics.

1) Sampling Units: would comprise of men and women. 2) Research Instrument: Structured Questionnaire

SAMPLE SIZE
51 respondent The primary data would be collected from 1) The population of Mumbai city The secondary data would be collected from: 1) Books 2) Magazines/ Project report 3) Internet 4) Articles The questionnaires response format for the population would be close ended questions. With a mix of question types varying from ranking, multiple choice to checklist questions. The attitude of the respondents would be measured by itemized category scales, pictorial scale.

Hypothesis
The null hypothesis would be: 50% of the consumer prefers buying branded jewellery. The alternative hypothesis would be: More than 50% of the consumer prefers buying non branded jewellery.

Literature Review
The emergence of branded gold jewellery: In the late 1990s, the Indian jewellery market witnessed a shift in consumer perceptions of jewellery. Instead of being regarded as only an investment option, jewellery was being prized for its aesthetic appeal. In other words, the focus seemed to have shifted from content to design. Trendy, affordable and lightweight jewellery soon gained familiarity. Branded jewellery also gained acceptance forcing traditional jewelers to go in for branding.

Given the opportunities the branded jewellery market offered; the number of gold retailers in the country increased sharply. Branded players such as Tanishq, Oyzterbay, Gili and Carbon opened outlets in various parts of the country. Traditional jewelers also began to bring out lightweight jewellery, and some of them even launched their in-house brands. However, the share of branded jewellery in the total jewellery market was still small (about Rs. 10 billion of the Rs. 400 billion per annum jewellery market in 2002), though growing at a pace of 20 to 30 percent annually The branded jewellery segment occupied only a small share of the total jewellery market because of the mindset of the average Indian buyer who still regarded jewellery as an investment. Moreover, consumers trusted only their family jewelers when buying jewellery. Consequently, the branded jewellery players tried to change the mindset of the people and woo customers with attractive designs at affordable prices.

Chapter 2 : Analysis - I

Gold Jewellery Market in India Before the liberalization of the Indian economy in 1991, only the Minerals and Metals Trading Corporation of India (MMTC) and the State Bank of India (SBI) were allowed to import gold. The abolition of the Gold Control Act in 1992, allowed large export houses to import gold freely Exporters in export processing zones were allowed to sell 10 percent of their produce in the domestic market. In 1993, gold and diamond mining were opened up for private investors and foreign investors were allowed to own half the equity in mining ventures. In 1997, overseas banks and bullion suppliers were also allowed to import gold into India. These measures led to the entry of foreign players like DeBeers, Tiffany and Cartiers into the Indian market. In the 1990s, the number of retail jewellery outlets in India increased greatly due to the abolition of the Gold Control Act. This led to a highly fragmented and unorganized jewellery market with an estimated 51,000 workshops supplying over 350,000 retailers, mostly familyowned, single shop operations. In 2001, India had the highest demand for gold in the world;

855 tons were consumed a year, 95% of which was used for jewellery. The bulk of the jewellery purchased in India was designed in the traditional Indian style. Jewellery was fabricated mainly in 18, 22 and 24-carat gold. As Hallmarking was not very common in India, under-carat age was prevalent. According to a survey done by the Bureau of Indian Standards (BIS), most gold jewellery advertised in India as 22-carat was of a lesser quality. Over 80% of the jewelers sold gold jewellery ranging from 13.5 carats to 18 carats as 22-carat gold jewellery. The late 1990s saw a number of branded jewellery players entering the Indian market. Titan sold gold jewellery under the brand name Tanishq, while Gitanjali Jewels, a Mumbai-based jewellery exporter, sold 18-carat gold jewellery under the brand name Gili. Gitanjali Jewels also started selling 24-carat gold jewellery in association with a Thai company, Pranda. SuRaj (India) Ltd. launched its collection of diamond and 22 -carat gold jewellery in 1997. The Mumbai-based group, Beautiful, which marketed the Tiffany range of products in India, launched its own range of studded 18-carat jewellery, Dagina. Cartiers entered India in 1997 in a franchise agreement with Ravissant. Other players who entered the Indian branded gold jewellery market during the 1990s and 2000-01 included Intergold Gem Ltd., Oyzterbay, Carbon and TribhovandasBhimjiZaveri (TBZ). Gili: In 1994, Gili Jewellery was established as a distinct brand by Gitanjali Jewels, soon after the abolition of the Gold Control Act by the Indian government. Gili offered a wide range of 18-carat plain gold and diamond-studded jewellery, designed for the contemporary Indian woman. The designs combined both the Indian and western styles and motifs. With sales of Rs.0.14 billion for the year 2000-01, Gili had a 0.03 percent share of the 400 billion jewellery market in India and a 1.4 percent share of the branded jewellery market. Tanishq: In 1984, Questar Investments Limited (a Tata group company) and the Tamil Nadu Industrial Development Corporation Limited (TIDCO) jointly promoted Titan Watches Limited (Titan). Initially involved in the watches and clocks business, Titan later ventured into the jewellery businesses. In 1995, Titan changed its name from 'Titan Watches Ltd.' to 'Titan Industries Ltd.' in order to change its image from that of a watch manufacturer to that of a fashion accessories manufacturer. In the same year, it also started its jewellery division under the Tanishq brand.

Among the branded jewellery players in the Indian market, Tanishq is considered to be a trendsetter. When it was launched in 1995, Tanishq began with 18-carat jewellery. Realizing that such jewellery did not sell well in the domestic market, the 18-carat jewellery range was expanded to include 22 and 24-carat ornaments as well. When Tanishq was launched, it sold most of its products through multibrand stores. In 1998, Tanishq decided to set up its own chain of retail showrooms to create a distinctive brand image. By 2002, Tanishq retailed its jewellery through 53 exclusive stores across 41 cities. To meet increasing demand, Tanishq planned to open 70 stores by the end of 2003 and offer a range of 'wearable' products with prices starting at Rs. 400. With sales of Rs. 2.66 billion in 2000-01, Tanishq had a 0.66 percent share of the total jewellery market and a 27 percent share of the branded jewellery market. Carbon: In early 1991, the Bangalore based PeakokJewellery 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, with sales of Rs. 0.14 billion, carbon had a 0.03 percent share of the jewellery market and a 1.4 percent share of the branded jewellery market. The company expected Carbon sales to touch Rs. 1.5 billion by 2005-06 and exports to start by 2008. The brand was available at 40 outlets in 16 cities in 2002 and would be made available in 23 cities by 2005. Oyzterbay: Oyzterbay was founded by VasantNangia and his team in July 2000. It began operations in March 2001. By November 2002, the company had 41 outlets across the country. Oyzterbay seeks to build a national brand in the jewellery industry in India and aspires to be the largest branded jewellery company in the country with a chain of 51 stores and several hundred-distribution points by 2004. With sales of Rs. 0.17 billion in 2000-01, Oyzterbay had a 0.04 percent share of the Rs.400 billion jewellery market and a 1.7 percent share of the branded jewellery market Trendsmith: Mumbai-based TribhovandasBhimjiZaveri (TBZ), which had been in the jewellery business since 1864, saw tremendous scope in the branded segment and opened its new concept store 'Trendsmith' in Mumbai in December 2001. Encouraged by the response towards its first store, the Zaveris planned to take Trendsmith (India) Pvt. Ltd. all over the

nation by opening as many as 50 stores by 2006. Trendsmith offered eight lines of exclusive designer jewellery from well-known export jewellery manufacturers and designers from Mumbai and Delhi. BRANDED GOLD JEWELLERY MARKET (MAJOR PLAYERS) Brand Tanishq Oyzterbay Gili Carbon Market share (2000-01) in %) 27.0 1.7 1.4 1.4

Source: ICFAI Centre for Management Research.

Strategies for Wooing Customers

Tanishq In the late 1990s, players in the branded gold jewellery market formulated strategies for wooing customers. According to Jacob Kurian (Kurian), Chief Operating Officer of Tanishq, the challenges were many. As the jewellery market was highly fragmented, lacked branding, and allowed many unethical practices to flourish, Tanishq worked hard on a two-pronged brand-building strategy: cultivate trust by educating customers about the unethical practices in the business and change the perception of jewellery as a high-priced purchase. Said Kurian, "We are changing the attitudes of customers from blind trust to informed trust." To increase its market share, Tanishq formulated a strategy for luring people away from traditional neighborhood jewelers. Tanishq's strategy was to create differentiation and build trust. According to Kurian, the first part of the strategy was "to provide a point of differentiation in a highly commoditized category - which is the whole point of branding." The second part of the strategy was to project Tanishq as an unimpeachable mark of trust. According to Kurian, "If differentiation plays the role of primary attraction, trust takes care of lifelong loyalty.

One way to create differentiation was through design. The emphasis had to be on design because local jewelers could offer to design any pattern according to the customer's specifications. For a national brand a generic design concept with regional variations had to be evolved. For this, Tanishq set up a seven member in-house design team and also outsourced designs from freelance designers. The designers travelled the length and breadth of the country to get feedback on Tanishq's designs and learn about customer preferences. On the basis of this feedback, each showroom could select the designs it would carry. Source:http://www.icmrindia.org/free%20resources/casestudies/branded-gold-jewellery1.htm

Brand appeal
Branded jewellery has found a niche for itself in the tough Indian market, and its increasing growth rates show that before long it will corner a significant share of the jewellery market. with the retail industry in India burgeoning, several companies have made inroads into the traditional jewellery industry, selling the product that was never really "marketed" in "brand" new ways. So much so that branded jewellery is the new mantra in the market, having rapidly acquired a niche over the past few years. Some of the companies have even cleverly played on Indian customs and tradition to advertise and establish their brands. Jewellery is now marketed for every occasion; even Valentine's Day calls for "a special something [diamond] for a special someone". In spite of pessimism about the marketability of branded jewellery in a country rooted in buying ornaments from the traditional goldsmith, 30 brands were launched in 2004. However, this does not take away from the fact that India is a tough market. According to MehulChoksi of the D'Damas and Gitanjali Group, branded jewellery has witnessed more than 50 per cent growth in the last three years. The diamond branded jewellery, he says, is especially impressive with the segment witnessing a 20 per cent rise annually as against 10 per cent a decade ago. Although branded jewellery accounts for less than 10 per cent of the Rs.40,000-crore jewellery market, a study has concluded that it is growing in popularity at a tremendous pace of 20-30 per cent annually. Such is the potential of this industry that the consulting firm

McKinsey estimates the branded jewellery market in India to grow at the rate of 40 per cent per annum to touch Rs.10,000 crores by 2010. Big drivers of this kind of jewellery are the numerous malls opening across the country with the emergence of an affluent class following the successful growth of the new economy companies. In the past decade, the country has seen a section of the population gaining exposure to designer wear, fashion accessories and globally branded products. "Why not have accesses to them?" asks Rima Khan, a brand executive. "Of course jewellery is harder to brand but it has done well given the tough competition," she says. One of the reasons branded jewellery is doing well is that now anyone can walk into a mall, window shop and decides at their own what they would like to buy. The entire culture of shopping has changed with attentive and helpful attendants and well-displayed products. "You no longer have the sales staff who look at you and decide whether you are worth serving or not. Everyone is a potential customer in the new market," says Rima Khan. Yet the most important part of branded jewellery is that you can get a piece of jewellery with a diamond for as little as Rs.1,500. And as branded is equated with quality, you are assured of a good product. "Suddenly jewellery has become accessible and affordable for all income brackets." The shift was visible in 2004 when more than 30 players entered the market. Today there are more than 50 brands, endorsed by models, film actors, sports celebrities and other wellknown faces. Some designs of these brands are so popular that local jewelers have begun to copy them. "While it is a compliment to the industry that people like the product, it could also affect the company because the cost may be lower," says Rima Khan. The biggest challenge perhaps is in educating the consumer. Consumers need to understand the four Cs - Cut, Carat, Color and Clarity. Companies that brand their products place a lot of emphasis on educating and therefore helping the customer make his purchase. "Buying jewellery is a very personal thing and we need to understand what we are buying," says Seema Thakur, an attendant in a jewellery store at a mall in Mumbai. "We have an average of 50 people on a week day and at least 51 on a weekend who walk in and look around the shop. If you make the product look special, for instance, appeal to a young gentleman to buy it for a

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loved one, he is often interested." And the big selling point is: "If you can spend Rs.1,000 on two music CDs, why not spend for that special person in your life." The branded jewellery industry is still in its infancy, but increasing growth rates show that in a short time it will corner a significant chunk of the market. Perhaps the best compliment to the branded segment is that old jewellery showrooms have also begun to design jewellery lines under a brand name. Source: http://www.flonnet.com/fl2223/stories/20051118003809800.htm

Indian Customers Showing Interest in Branded Jewellery

Posted by RNCOS on October - 27 - 2009 As per our recently published research report Indian Gems and Jewellery Market Future Prospects to 2011, gems and jewellery market in India posses tremendous potential for future growth since it has an added advantage of low production cost and highly skilled labor that separate it from its competitors. It is projected that the overall gems and jewellery market will grow at a CAGR of around 14% during 2009-2012. India possesses worlds most competitive gems and jewellery market due to its low cost of production and availability of skilled labor. As per our new research report Indian Gems and Jewellery Market - Future Prospects to 2011, highly skilled and low cost manpower, along with strong government support in the form of incentives and establishment of SEZs, has been the major driver for the Indian gems and jewellery market. The market also plays a vital role in the Indian economy as it is a leading foreign exchange earner and accounts for more than 12% of Indias total exports. Currently the Indian market remains highly fragmented, but is rapidly transforming into an organized sector. Currently, the industry is facing a slowdown due to global economic turmoil. But due to various government efforts and incentives coupled with private sector initiatives, the Indian gems and jewellery sector is expected to grow at a CAGR of around 14% from 2009 to 2012. At present, the Indian gems and jewellery market is dominated by the unorganized sector; however, the trend is set to change in near future with the branded jewellery market growing at an expected CAGR of more than 41% in the coming four years. As per our research report, with its consumption pegged at nearly 20%, India remains worlds largest gold consumer and this share is expected to grow further.

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Given the fact that majority of market share is occupied by family-owned jewelers, the domination of unorganized segment still continues on the Indian gems and jewellery market. However, this scenario is gradually changing with the entrance of organized players who primarily focus on customer satisfaction by giving better and finer quality products. Thus, consumers are now moving towards branded jewellery which is more reliable in terms of quality and design. Source: http://www.rncos.com/Report/IM148.htm

Traditional v/s Branded jewelers

Gems and Jewellery sales and marketing received a facelift with the advent of the supermarket culture. As organized retail in India progresses to the next lap, Sadanand Subramanian checks for Diamond World with some precious Industry players about their preparedness and strategy to achieve maximum mileage. As India reacts to a retail revolution, the hitherto sober gems and jewellery industry seems to have jumped on the bandwagon with a clear plan of action. The industry has already made a mark by capturing 3 per cent of the organized retail space thanks to the leadership shown by a handful of companies prepared to dazzle the world. While organized retail under this segment impressively grows at over 50 per cent annually, deliberations are on to arrive at what the industry in general must do to keep the customer perennially delighted. The gems and jewellery market in India is estimated to be about Rs.80,000 crores and the topmost agenda is to adopt the right strategy to accelerate its growth keeping in mind current global dynamics. For now the industry faces keen competition from other luxury goods such as electronic innovations and other personal accessories. How far is it necessary for the gems and jewellery sector to seriously consider it? There is no doubt that things are a lot more organized in stores inside malls. They also showcase and present products very attractively. But in my opinion, real sales take place through traditional jewellery stores as jewellery is mainly sold on trust. GhanshyamDholakia The urgency in the industry indicates rapid changes in the way goods are produced and marketed. The evolution of new formats for sale and the massive technology and to some extent, sizeable infrastructural developments taking place all foretell a prospect of growth way beyond the current overall 10 per cent.

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The Indian gems and jewellery industry boasts a strength of over 3 lakh jewellery retailers across the length and breadth of this country. The huge number indicates strength in itself but it also indicates a difficult diversity to grapple with when exploring common grounds to formulate united approaches to tackle common concerns.

Organized V/s Traditional Retail:

Comparisons have always been drawn between organized retail and traditional retail. Attempts have always been made to define them. Rooting for organized retail, NavneetGoenka, Vice- Chairman of Goenka Diamond and Jewels says, Right now organized retail seems to have wrested an edge over traditional retail. Goenka argues that the indications to this effect are seen in the manner large proportions of the society are becoming lifestyle oriented, especially the younger generation. When considering Indias statistic of having the highest percentage of youth in the world, this observation cannot be taken lightly. Goenka says that the gems and jewellery sector is one of the fastest growing segments. He adds, The young generation today has more disposable income and they are willing to spend it on luxuries of choice. GhanshyamDholakia, partner, Harikrisha Exports holds a different view with regard to the tussle for supremacy over the two formats. There is no doubt that things are a l ot more organized in stores inside malls, he concedes. They also showcase and present products very attractively. But in my opinion, real sales take place through traditional jewellery stores as jewellery is mainly sold on trust. While explaining his point of view, he adds, To the credit of traditional jewellery stores they also have upgraded themselves in various ways including the overall ambience in the last five to ten years. They are also changing themselves in the matters of presentation and the customer approach. Dholakia says that in promotions and awareness creation, traditional retailers have realized its importance thereof and have started allocating sizeable budgets for them. Consequently this section has already started reaping the benefits of quality promotions by creating awareness about their products and services. Dholakia is some what emphatic with regard to modern day organized retail citadels, In my personal opinion malls mainly serve the purpose of promotion and show of products. I dont think a lot of gems and jewellery sale takes place in malls. Ashwin Shah, Head of Retail at C. Mahendra Exports holds a similar view with regard to jewellery sales at modern shopping malls. He opines, The sales that take place in a mall are

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of a very different kind. You can call it window shopping if you like. Shah elucidates his point, The young generation often resorts to some impulse buying. He stresses that serious buyers who are looking for high value purchases for occasions such as weddings prefer to plan their jewellery shopping and eventually purchase from known reputed jewelers.

Changes in Gems & Jewellery Retail:

Whilst organized retailers are ahead when it comes to taking care of the different aspects in the marketing and sales value chain, those in traditional retail are also changing or adapting to the needs of the modern customer in the areas of service and customer care. They too are improving their style of presenting and dealing with customers. In the past, jewelers didnt have much modern education. Today, there are a number of MBAs in these families and amongst key personnel employed by them, points out GhanshyamDholakia.

Retailing the Organized Way: While complementing the planned approach by organized retail, Mahesh Gandani-Head Retail, Hari Krishna Exports says, We can see that times have changed and somewhere along the way, the whole approach to marketing has also undergone transformation. Gandani says that for branded diamond jewellery there is much planning involved. He says meticulous strategy is charted out, and there is systematic presentation of the product. All this goes on even as a product portfolio is made and promotions are carried out. Gandani says creating brand awareness in the minds of the consumers is all about adopting a few strategic steps. One might say the difference between traditional and organized is just doing and doing by planning. Recent developments have been both a boon as well as a bane. Actually, this has spurred us on to become innovative with our offerings to suit the market. We have actually managed to reduce cost by adopting the strategy of reducing the volume of gold in some of our products to make it affordable. Ashwin Shah Speaking about organized retail, V. Muraleedharan, gems and jewellery professional and visiting faculty at well known management institutes in Mumbai says, The number of foreign brands coming into India is simply amazing. Brands that were only heard of a few years ago are today very much within anyones reach here. Muraleedharan goes on to

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explain, So far people who had only seen traditional offerings have started making intelligent international comparisons with Indian products and this has brought about real room for retail to grow a number of times. Well known brands have always insisted that when they talk about a particular grade, they are certified. Moreover the quality standard is confirmed and authorized and remains the same in any laboratory in the world. Muraleedharan says, In my opinion the quality a bran d expresses, and the certification make it easy for a customer to confidently buy the product.

The Value Proposition: Today everyone is looking for value for money, a new design, a new concept, something very creative and that is the concept of retail today. It is not like yesterday where the shopkeeper or the manufacturer used to dominate. Today, the customer is going for customized designs; the whole concept is changing, says Muralidharan. The consumer is looking for value for money, when they buy diamonds. They like to buy from reputed players like example Tanishq, Gitanjali, Goenka, Nakshatra, Kiah and Nirvana. All of whom have achieved very organized presence in the market today. Each one of them has a standard quality certification internationally and that is what is going in the minds of the customer when they talk about buying from the organized sector. Source: jewellery-24860/ STUDY ON THE JEWELLERY INDUSTRY 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. http://www.pressabout.com/indian-customers-showing-internet-in-branded-

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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. YESTERDAY Unbranded Silver & Gold jewellery Investment Traditional design TODAY Branded Gold & Diamond jewellery Investment + Fashion Fashionable & innovative design

Marriage & festival is peak Wear ability and gifts season

SOURCE DIFFERENCE

OF ROSY BLUE

GITANJA LI

TANISHQ

JOY ALUKKA S

RELIANCE JEWELS

SALES TURNOVER (in Crores)

7200

4832

3520

3350

800

TARGET CUSTOMER

Upper Middle &above

Middle &above

Upper middle &above

Middle &above

Middle &above

MARKETING STRATEGY

Events

Advertisin g

Customer Schemes

Theme based advertisin g

Press releases

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Source: http://www.sc.com/doc/19901085/Jewellery-Companies-Comparison TRENDS IN JEWELLERY REPORT Submitted By (KAMALAKKANNAN G KARTHIKA DEPARTMENT OF MANAGEMENT STUDIES SCHOOL OF MANAGEMENT PONDICHERRY UNIVERSITY) Jewellery Industry INDUSTRY OVERVIEW Indian Jewellery market in 2011 was valued at 70,000 cr. INR (Business Standard). Indias Jewellery market size is US$ 13 billion Gold Jewellery market CAGR 10 -15% Diamond Jewellery market growth 27% India remains in worlds largest consumer of gold. Exports about $ 17 Million in 2010 Share of India's Gem and Jewellery Sector
4%

Organized Retailer Family Jewelers 96%

Organized Family Retailer Jewelers

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4%

96%

About, 96% of Indian Jewellery Market is unorganized. The unorganized sector represents 300,000 traditional retailers or Family jewelers who are present only in one town. The organized sector accounts to only 4 percent TODAY The industry of jewellery has flourished in the past few years due to the increased demand of fashionable jewellery. The export and import of jewellery has also amplified. People nowadays have a passion for jewellery which accounts for the growth of this industry all over the world. Jewellery is used for fashion as well as decoration. In the past jewellery was used to adorn bible monuments and other decorations were made using different pieces of valuable jewels. A wide variety of jewellery is available; costume jewellery, fashion jewellery, body jewellery, antique jewellery, traditional jewellery, modern jewellery and many more. LATEST TRENDS a) Recent fluctuations in the stock market, reduced Interest rates made investment attractive on jewellery. b) The gems and jewellery industry occupies an important position in the Indian economy. c) It is a leading foreign exchange earner, as well as one of the fastest growing industries in the country.

d) 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. e) The industry has set up a worldwide distribution network, of more than 3,000 offices for the promotion and marketing of Indian diamonds. f) India is the diamond polishing capital of the world specially the states of Gujarat and Maharashtra. g) 51% FDI is permitted in gems and jewellery sector. h) The growth of Branded Jewellery is eminent in the coming days. Source: http://www.commodityonline.com/news/Branded-gold-jewellery-shops-lure-Indians23837-3-1.html
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Chapter 3 : Analysis - II
Analysis and Findings The objectives of the study was to understand the consumers buying preferences, the reach of branded jewelers, brand awareness of various brands in the jewelers market. Hence the first question was to find out the factors that guide a customer while purchasing jewellery which dealt with nine attributes. The respondents where just asked to tick on the attribute that guided that purchase decision. The result is as follows Family Service and Friends 2 12

Design

Price

Purity

Image

Variety

Display

Promotion and Offers 10

85 Table 1

92

87

65

67

From the above results an observation can be drawn that out of the 51 respondents 92 of them feel that price is a major factor that guides their purchase decision. Apart from price purity also is considered important by 87 respondents, followed by design with 85 respondents feel it is an important factor. Variety and image are the other important attributes that are considered while making a purchase decision. Attributes like family and friends, promotions and offers are still not very popular among the respondents selected for this research. The attributes like service and display have been selected only by 2 and 5 respondents respectively showing that these are the least important thing that guide an individual to purchase jewellery. The diagram below shows the guiding factor of the respondents while purchasing jewellery in an ascending manner.

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100 90 80 70 60 50 40 30 20 10 0

85 65 67

87

92

10

12

Figure 1

Question two dealt with the awareness of various brands of jewellery available in the market. This question would help find out the percentage of the respondents who are aware about branded jewellery.

Yes 51 Table 2

No 0

From the above result it can be observed that there is 51% awareness about branded jewellery. Out of the 51 respondents there is not a single respondent who is not aware about branded jewellery. The third question was to find out the popularity of 5 brands. The respondents were asked to tick against the brands that they are aware about. The 5 brands considered here are Gili, Tanishq, Ddamas, Oyzterbay, and Trendsmith. These are the prominent brands for gold jewellery there are many other players but the research is limited to gold jewellery. Brands No of Gili 70 Tanishq Takle 80 51 Bafna 51

Respondents

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Table 3

120 100 80 60 40 20 0 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
East

Figure 2 From the above table and figure inference can be drawn that brands like Gili, Tanishq are known but the traditional Mumbai outlets of Takle and Bafna our preferred The fourth question was to find out the reason why the respondent purchases jewellery that is the reason for purchasing. Is it purchased as an investment option or on occasions, festivals or as a fashion statement? Investment Fashion Occasions Festivals No of 34 39 11 16

Respondents Table 4

34 respondents buy jewellery for investment purpose, 39 respondents look out for fashion or the latest trends while purchasing jewellery. 11 respondents buy jewellery during occasions like weddings, anniversary, birthdays etc. and 16 respondents buy jewellery during festivals.

21

No of Respondents
16 34 11

Investment Fashion Occasions Festivals

39

Figure 3 The fifth question is a direct question which inquires the respondent preference for jewellery that is it branded or family jeweler. Branded Family

Preference No of

Jewellery Jeweler 69 31

Respondents Table 5

From the above table it can be observed that 69 respondents prefer branded jewellery and 31 respondents prefer family jewelers. This makes branded jewellery more popular among the respondents.

22

Family Jeweler, 31 Branded Jewellery, 69

Figure 4 The sixth question further probes into finding out how many among the respondents have bought branded jewellery. Branded Jewellery No of Not bought 22

Bought

Respondents Table 6

78

No of Respondents purchasing branded jewellery

Not bought 22%

Bought 78%

Figure 5

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Out of the 51 respondents 78 have bought branded jewellery and 22 have not bought branded jewellery. However even if these 22 respondents have not bought branded jewellery they are aware of branded jewellery being sold and also know the brands by their names. Since the sample consist of females and males the next set of question deals with whether jewellery is bought for gifting purpose If the respondents do buy jewellery for gifting purpose then where is it bought from family jeweler or branded shops. Buy jewellery

for gifting No Respondents Table 7 of

Yes

No

30

70

30 respondents of the 51 buy jewellery for gifting purpose among these 30 12 are men. 70% of the respondents do not buy jewellery for gifting purpose. The next question was the jewellery purchased for gifting is branded or non branded and the result found are as under Family jeweler 16

Branded No of

Respondents Table 8

14

14 respondents out of 30 buy branded jewellery for gifting and 16 out of 30 buy jewellery from their family jeweler for gifting. Percentage wise 46% buy branded jewellery for gifts and 54% buy jewellery for gifting from their family jeweler.

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Percentage of Respondents
Family jeweler 54% Branded 46%

Figure 6 The ninth question was Given below are few characteristics of traditional family jewelers (or local jewell ery retail stores). Please give each characteristic some points based on your assessment, such that the points range from 1 to 10. (1 being the lowest and 10 being the highest). Characteristics of Family Jewelers Convenient Trustworthy Good Investment Price Traditional design Number of points

This question will help gain an insight as to which parameter of a family jeweler attracts respondent towards them. Since the points are given out of 10 and there are 51 respondents each parameter will be out of 510. Characteristics of Family Jewelers Number of points Table 9 The respondents were asked to give points on a scale of 1 to 10 where 10 was the highest hence the total figures are arrived by adding the points given by all the 51 respondents. Hence Good Investment 775 Traditional design 745

Convenient

Trustworthy

Price

660

895

870

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if the convenience characteristic was to be taken then it scored 660 out of the grand total of 510. The respondents have rated trust aspect of family jewelers high hence it has scored 895. The respondents also feel that the price charged by the family jewelers is reasonable and hence have given it decent points i.e. 870. While purchasing jewellery from family jewelers the respondents consider it to be a good investment. Family jewelers are popular for traditional designs and the respondents have given it points that add up to 745. The 10th question was If you purchase branded jewellery then given below are a few characteristics. Please give each characteristic some points based on your assessment, such that the points range from 1 to 10. (1 being the lowest and 10 being the highest). Characteristics of branded jewellery Wide range of products under one roof Shopping experience Trendy and fashionable jewellery Price Number of points

Since the points are out of 10 and the no of respondents who have bought branded jewellery are 78. Hence the assessment of this question is based on the points given only by these 78 respondents. Hence the total would be 780 and not 510 here. Wide Characteristics branded jewellery of of range

products Shopping one experience

Trendy fashionable jewellery 727

and Price

under roof

Number of points Table 10

663

590

673

Respondents rate trendy and fashionable jewellery highest when it comes to branded jewellery. It scores 727 out of 780. Price also according to the respondents is justified hence it scores 673. Shopping experience wise branded showroom scores least among the other

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characteristics. This could also be because when a customer goes to buy jewellery he may not be looking for the experience but wanting good trendy jewellery which is priced appropriately. The eleventh question was to find the level of satisfaction on a scale of 1 to 10 for family jewelers. Since the points are given out of 10 and there are 51 respondents the level of satisfaction will be out of 510. Level satisfaction 765 of

Family jeweler No of respondents Table 11

The level of satisfaction that the respondents have is 765. Hence if the average were to be removed it would be between 7 and 8. The last question was to find the level of satisfaction for branded jewellery on a scale of 1 to 10. Here again the rating is out of 780 because only those respondents who have bought branded jewellery are being considered. Branded jewellery No respondents of Level satisfaction 693 of

Table 12
The level of satisfaction on the whole for branded jewellery is 693 and if the mean were to be removed then it would be between 8 and 9 hence the level of satisfaction that the respondents have towards branded jewellery is higher than that towards family jewelers. Thank you. To draw a conclusion from the above literature review one can observe that there is immense scope for the growth of branded jewellery. In spite of the economic slowdown experts believe that it will grow at a CAGR of 25%. There are also statements like the industry does not cover the entire population making a scope for further growth.

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 The review also brings light to the fact that the Indian consumers are price sensitive and hence the branded jewelers cannot charge exuberant prices for the same. The jewelers have to offer designs that are more Indian in their culture rather than aping the west this can be proved by the e.g. of Tanishq and should also be affordable. Since the thesis focuses on a comparative study of the popularity of branded v/s non branded jewellery the review helps understand the growth of the retail industry which have leased branded jewellery stores and also the popularity of traditional goldsmith The number of foreign entrants also pose a challenge to the traditional jewelers and hence we can see that these jewelers also come up with strategies to retain their customers these practices were not prevalent in the market previously. The branded jewelers on the other hand have to adapt strategies to win the trust of their customers and attract new customers. A few research reports also help us gauge the changing trends in the jewellery market and the popularity of diamonds.

Summary Investment in jwellery is no longer a decision governed by as investment in an asset class but as a fashion and status accessories Prosperity to buy branded jwellery as against from traditional family jewelers is prompted by design, features and purity Branded offers a consumer a portfolio ranging from platinum to silver which was traditionally as gold earlier. Brands also give choices to consumer to fashionably attire themselves with gems, stones and pearls.

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Conclusion
The conclusions that can be drawn from the study are: 1. The guiding factor behind purchasing jewellery is price, purity and design which score the maximum. Other factors are variety, the brand image, influence of family and friends. The least guiding factor for purchasing jewellery is the service and display. Hence when a customer goes to buy jewellery they do keep the price in mind followed by the purity and the design. Factors like service given the shop or by the jeweler and the display do not have a very big impact on the customers. 2. Branded jewellery is extremely popular since it has 51% awareness. This may be due to the wide spread publicity taken up by the various brands. Brands like Gili, Ddamas, and Tanishq are again the most popular brands. Trendsmith is a brand by Tribhovandas Bhimji Zaveri (TBZ) which is not very popular. 3. As stated in the literature review that there was a shift in consumer tastes: women were increasingly opting for fashionable and lightweight jewellery instead of traditional chunky jewellery. Is proved to be correct by this research as respondents have selected fashion over investment while purchasing jewellery. Now jewellery is regarded as more of an accessory and less of an investment. 4. Branded jewellery is bought by more than 3/4th of the population. Hence it can be said that the population is aware and has also tried these brands. 5. When jewellery is bought for gifting purpose the population still wants to buy it from their family jewelers. 6. When it comes to family jewelers the level of satisfaction that the population has on a scale of 1 to 10 is a little more than 7. These jewelers are also popular because of the trust that they have with their customers and also because they charge reasonable prices. These family jewelers are also popular for traditional designs hence when a customer is specifically looking out for traditional jewellery they approach these jewelers. The jewellery bought from these jewelers is considered to be pure and a good investment. 7. The level of satisfaction that the population has towards branded jewellery is a little higher than non branded.

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These branded jenwelers have become popular for latest and trendy jewellery. Also the prices that the branded jewelers charge is justified and they provide a wide range of products under one roof. 8. The level of satisfaction that the population has for branded jewellery is higher than that for non branded jewellery making branded jewellery more popular. 9. The consumers prefer buying branded jewellery over non branded jewellery. This has also been proved by using the sign test.

Hence to conclude branded jewellery is recording exponential growth over non branded jewellery.

BIBLIOGRAPHY Secondary data collected from the internet. The web sites are: 1) http://www.icmrindia.org/free%20resources/casestudies/branded-gold-jewellery1.htm 2) http://www.flonnet.com/fl2223/stories/20051118003809800.htm 3) Source: http://www.rncos.com/Report/IM148.htm 4) http://www.pressabout.com/indian-customers-showing-internet-in-branded-jewellery24860/ 5) http://www.scribd.com/doc/19901085/Jewellery-Companies-Comparison 6) http://www.commodityonline.com/news/Branded-gold-jewellery-shops-lure-Indians23837-3-1.html 7) http://www.gulf-daily-news.com/NewsDetails.aspx?storyid=266902 8) http://www.diamondworld.net/contentview.aspx?item=2465 9) http://travelersindia.com/archive/v5n2/v5n2-indian_jewelry.html 10) http://www.icmrindia.org/casestudies/catalogue/Business%20Strategy1/BSTR041.ht m 11) http://www.rncos.com/Market-Analysis-Reports/Indian-Gems-and-Jewellery-MarketFuture-Prospects-to-2011-IM148.htm
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12) http://www.allheadlinenews.com/articles/7017273531 Newspapers: 1) The Times of India 2) The Economic Times

Annexure Management Thesis

A comparative study on the consumers preference towards branded jewellery over non branded jewellery in Mumbai

QUESTIONNAIRE NO. ___ RESPONDENT NO. ___ Hello, I am Deepak Pandey. I am a second year student of management pursuing my M- Com II at Mithibai college Mumbai. As a part of my curriculum I have to undertake a survey on the given topic. All the information that we collect is strictly for study purpose and will be dealt with at most confidentiality. This survey would take only 10 minutes of your time. Name: Telephone number: Design Variety Service Yes Gili Investment Price Display Age: Purity Brand Image

1) Factors that guide you while purchasing jewellery? Promotions and offers

Family and friends influence No Tanishq Fashion Takle Bafna Occasions Festivals

2) Are you aware of the various jewellery brands available in the market?

3) Tick against the brands that you are aware about in the jewellery market 4) You buy jewellery for

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5) Which jewellery do you prefer? Branded Yes Yes Branded Family Jeweler No No Family Jeweler

6) Have you bought any branded jewellery?

7) Do you buy jewellery for gifting purpose?

8) Where do you prefer to buy the jewellery from (for gifting)? 9) Given below are few characteristics of traditional family jewelers (or local jewellery retail stores). Please give each characteristic some points based on your assessment, such that the points range from 1 to 10. (1 being the lowest and 10 being the highest). Characteristics of Family Jewelers Convenient Trustworthy Good Investment Price Traditional design 10) If you purchase branded jewellery then given below are a few characteristics. Please give each characteristic some points based on your assessment, such that the points range from 1 to 10. (1 being the lowest and 10 being the highest). Characteristics of Branded Jewelers Wide range of products under one roof Shopping experience Trendy and fashionable jewellery Price Number of points Number of points

11) Given below is a scale that indicates points from 10 to 1, you have to indicate a point that describes your satisfaction on the overall satisfaction on jewellery purchased from family jewelers (local jewellery retailer). 10 being the best

10

32

12) Given below is a scale that indicates points from 10 to 1, you have to indicate a point that describes your satisfaction on the overall experience of store and the branded

jewellery that they offer. 10 being the best

10

33