UNDERSTANDING THE PRESENCE OF

SILVERRAGE IN THE INDIAN MARKET

MARKETING RESEARCH REPORT

Master of Fashion Management, NIFT, New Delhi

Batch 2016-2018, SEM 1
24th November 2016

Submitted to:
Dr. Sibichan K. Mathew

Submitted by:
Akshay Garg
Ankita Rajbhandari
Guneet Kaur
Rashika Rao
Vaishali Batra

Acknowledgement
We are grateful to NIFT for providing us an opportunity to carry out this
research project and connecting us with Silverrage. Working on a live
project was an insightful experience and it helped us gain better
understanding of how a marketing research is conducted. We were
cordially received by each and every store we visited during the course of
our study and even in this short span we were made to feel like a part of

the family. We would like to thank a number of people who have helped us
in the completion of this project.
Firstly, we would like to thank our project mentor Dr. Sibichan K. Mathew;
Professor (Fashion Management Studies Department) for extending his
help and guidance whenever required and having the patience to clarify
our incessant queries. We are immensely thankful for all his inputs and
feedbacks without which this project would have never come through.
We are also thankful to Ms. Rhythm Burman, Assistant Manager Silverrage
(E-commerce Business Development) and the team for investing their
valuable time in us and guiding us through the course of this project.
We express our whole hearted thanks to Mr. Sunil Motwani, for his
encouragement and support in analysing our data and giving us valuable
tips for making it presentable.
NAMES: Akshay Garg, Ankita Rajbhandari, Guneet Kaur, Rashika Rao,
Vaishali Batra
Master of Fashion Management
Date of submission: 24th November, 2016

Executive Summary
This marketing research project has been written keeping in mind the
upcoming brand Silverrage which deals in handcrafted silver jewellery. It
aims first to find out the customer perception about the brand as well as
to understand the target customer group and finally suggests a host of
1

marketing strategies and activities that will help Silverrage to achieve the
target of increasing its brand presence in India.
Methods of analysis include descriptive and inferential research. The
descriptive research includes observation and consumer questionnaire
method. In addition to the descriptive research, inferential research has
been used which includes application of statistical tools like Chi square
which helps determine the relationship between two variables. Results of
data analysed show that like any other product, domestic online jewellery
market is showing an increasing trend and there is less brand recall and
awareness.
The report further aims to create marketing strategies that covers 10Ps of
the marketing mix. The report also investigates the fact that the analysis
conducted has limitations. Some of the limitations include that:
The research has been completed in a limited time. It is therefore, not
possible to see the effects of the recommendations made.
The possibility of errors introduced into the primary data due to
insufficient or imprecise information provided by people.
The sample size has been limited so as to make the study manageable,
and fit into the curriculum timeline.
The conclusion, therefore, are subject to aforesaid constraints and are
only exploratory and suggestive in nature.

Table of Contents
Chapter 1: Introduction...............................................................................5
About the Brand.......................................................................................5
Chapter 2: Research Design and Methodology............................................6
Objective..................................................................................................6
2

Research Design & Methodology..............................................................6

Target Market for Survey..........................................................................7
Survey Population....................................................................................7
Sample Size..............................................................................................7
Sampling Method.....................................................................................7
Data Collection.........................................................................................8
Chapter 3: Review of Literature...................................................................9
Chapter 4: Studying the Brands Target Group using primary data...........11
Chapter 5: Understanding the Marketing Mix and devising Strategies.....30
Segmentation, Targeting, Positioning.....................................................30
10 Ps of Marketing..................................................................................31
People.................................................................................................31
Product................................................................................................31
Pricing.................................................................................................31
Positioning...........................................................................................32
Placement...........................................................................................32
Presentation........................................................................................32
Promotion............................................................................................32
Packaging............................................................................................33
Processing...........................................................................................33
Playback..............................................................................................34
SWOT Analysis.......................................................................................35
Chapter 6: Analysis...................................................................................36
Chapter 7: Conclusions.............................................................................41
Limitations.............................................................................................41
Bibliography..............................................................................................42
List of Figures............................................................................................43
Annexure 1................................................................................................45
Questionnaire.........................................................................................45
Appendix 1................................................................................................49
Silver Jewellery Report 2015 (USA)........................................................49
Appendix 2................................................................................................51
Silver Jewellery Report Global..............................................................51
Appendix 3................................................................................................53
A multifaceted future: The jewellery industry in 2020...........................53
Appendix 4................................................................................................54

Silver, the new Gold - Images Retail......................................................54

Appendix 5................................................................................................56
Silver Jewellery Market in India..............................................................56
Appendix 6................................................................................................57
Silver Jewellery and Accessories Market in India....................................57

Chapter 1: Introduction
The following document is a part of a curriculum based project, to
understand the whole process of marketing research. In this marketing
research, a live case study was undertaken to study and analyse the
brand presence of Silverrage in the Indian market. Further, the brands
target group was analysed through primary data using questionnaires and
observations. Secondary data has also been used to understand the
potential of the silver jewellery in the Indian market.

About the Brand

A pioneer brand in handcrafted sterling silver jewellery for women,
Silverrage was launched by Ms. Kiran Burman in the year 2000. Brimming
with creativity and a deep seated interest in design, she came up with the
idea of putting forth a whole new collection, which was an amalgamation
of high polish Italian finish and traditional Indian ethnic look. Rhythm
Burman, her daughter, a graduate from NIFT joined Silverrage to freshen
up the perspective and contribute to design innovation.
The brand sells its jewellery through its website silverrage.com and a
shop-in-shop concept in newU stores across various malls as well as
markets in metropolitan and Tier-II cities in India. The brand caters to the
youth along with working class women, promoting the ideology Silver is
the new gold. Silverrage is a team of 40 people working together
dedicatedly to create exquisite jewellery with precision and love for the
craft.
Currently present in 22 newU stores, the brand provides easy-to-wear
silver jewellery such as drop and stud earrings, necklaces, pendants, rings
and toe rings etc.
The brand sells its products under 2 different collections: Silverrage and
Silvore.
Silverrage provides elaborate designs available at premium prices
whereas Silvore offers dainty and small pieces such as stud earrings at
affordable prices.
The brand also introduced a collection of silver Rakhis in August 2016
which garnered a lot of attention for the brand. Maintaining and increasing
its presence on social media, Silverrage also sells its products through
Instagram and Whatsapp.
The future plans of the brand include selling its silver jewellery through ecommerce platforms like Flipkart and Amazon. It also plans to foray into
other segments such as dcor pieces, artefacts, bookmarks etc. made of
sterling silver.

Chapter 2: Research Design and

Methodology
Objective
To devise marketing strategies to expand the brand presence of Silverrage
in the Indian market

Sub-Objective

To analyse the brands target group through primary data from

New U stores and online across Delhi/NCR

To study and analyse the customer's perception about the brand

and devise strategies to increase its presence in the Indian market

Research Design & Methodology

Descriptive Research Since, a weak marketing strategy and low
customer base is being experienced by the brand; a descriptive
research will be carried out because the problem is described.
The study will be carried out in the following method:
1. Observation Method
2. Customers Questionnaire
Observation Method
o Spending some time in the NEWU store and collaborating with
the sales staff to keep the track of the age group or segment
which is the prime purchaser and the styles that have been in
demand throughout.
o Conducting a study to analyse the silver jewellery products
preferred by the target customer base, to know about the problem
areas.
Customers Questionnaire Method
o A consumer survey conducted by administering a structured
questionnaire.
o The questionnaire will include various open ended and close
ended questions.

Inferential Research it is the kind of research that extends beyond

the analysis of the immediate data alone. The Chi square test was
implemented to further analyse the data

Target Market for Survey

-For this survey, women who have previously purchased or purchase silver
jewellery on a regular basis were targeted.
- The Physical survey was done through women customers of newU store
and an online survey was done through women who reside within Delhi,
NCR and wear or purchase silver jewellery.

Survey Population
Target population: Women population of Delhi, NCR who wear or purchase
Silver Jewellery.

Sample Size
100 women who wear or purchase Silver Jewellery out of which 50
respondents were customers of newU Store.
For this survey, it was decided that it would be too difficult to get more
than 100 people to respond to the questionnaire due to time and resource
constraints.
Also customers of the newU store would not have been willing to respond,
even if they belonged to our specific target group.
Special arrangements would have been required to be made to get
responses from all the targeted customers.

Sampling Method
For this survey the Purposive Sampling method was used by including
women who purchase silver jewellery and excluding those who do not.
This method was chosen as it enabled in selecting a sample based on the
purpose of the study and knowledge of a population.
To conduct the Purposive sampling, mixed sampling techniques were used
through the medium of Online and Physical Survey.
As one of the objective was to gain an insight about the customers
perception about Silverage in the newU store, for this reason a physical
survey was a necessity. The physical survey helped in reaching the target
audience and also through a personal approach, the customers were
encouraged to give accurate answers, hence making the survey more
reliable.

Due to time and cost constraints online method of survey was chosen as
well and through this medium it was possible to collect data from large
number of respondents, at a faster rate via emails and social media.

Data Collection
RESEARCH
METHODOLOG
Y

INFORMATION REQUIRED

Primary Data

o
o

Secondary
Data

Gathering information about the most preferred items in silver

jewellery and other silver articles by the customers in the
target age group.
Studying the brand perception of Silverrage by the customers.
Observing and analysing the buying behaviour of the
customers for both online and physical sales.

Gathering information about the global and domestic silver

accessories market and major players.
Future prospects of the global and domestic silver accessories
market.

Chapter 3: Review of Literature

Modern fashion accessories can be classified majorly into soft accessories,
leather goods and other accessories, semi-precious and junk jewellery
(fashion jewellery), time wear and eye wear.
According to a report by McKinsey, the global jewellery market is expected
to reach $312 billion by 2020 at a growth rate of 5%-6% per year. As of
now, the jewellery industry is primarily a local industry. The ten biggest
jewellery groups capture a mere 12 percent of the worldwide market, and
only twoCartier and Tiffany & Co.are in Interbrands ranking of the top
100 global brands. The rest of the market consists of strong national retail
brands, such as Christ in Germany or Chow Tai Fook in China, and small or
midsize enterprises that operate single-branch stores. But in the coming
times the five trends that will shape the jewellery industry are
internationalization and consolidation, the growth of branded products, a
reconfigured channel landscape, hybrid consumption, and fast fashion.
In 2004, the online sales of jewellery accounted only for 4 to 5% of the
market, with substantial variations across regions, brands, and types of
jewellery. This numberat least for fine jewellerywill reach 10% by
2020 and would not grow much beyond that. The rationale is that
consumers prefer to buy expensive items from brick-and-mortar stores,
which are perceived as more reliable and which provide the opportunity to
touch and feel the merchandisea crucial factor in a high-involvement
category driven by sensory experience.
Some general trends in the US Silver Jewellery market state that retailers
are spending 23% of their annual marketing dollars on print advertising.
Print advertising 23%; Promotions/events 19%; online ads/website 18%;
Social media 14%; Direct mail/catalogues 9%; Staff training/education
11%; other 6%.
According to the same report, 25% retailers said social media plays an
important role in the consumers purchase consideration.
For Silver Jewellery Fabrication, according to a study by GFMS, for the
Silver Institute, India was the third largest fabricator of silver jewellery in
2005. Its output of 560 tonnes was eclipsed by Thailand with 1,005 tonnes
and Italy with 980 tonnes. Silver jewellery fabrication is highly

concentrated: together the top-5 countries (the other two being China and
Mexico) account for 70% of global production.
On a consumption basis, the global rankings are rather different. The
United States with 1,670 tonnes was by far the largest silver jewellery
market in 2005, accounting in fact for no less than 31% of global
consumption. A distant second with 457 tonnes that year was India, with
Germany taking the bronze medal on 375 tonnes. Global silver jewellery
consumption is less concentrated than fabrication, in the case of the
former, the top-5 consuming countries together accounting for 58% of the
global total in 2005.
Looking at the Domestic Scenario, in 2013, jewellery and silverware
market had grown by 25% compared to 2012. This new demand has come
from young professionals who prefer light-weight inexpensive jewellery for
day to day use, exports and demand from tourists. According to GJEPC,
India exported around $1430 million worth of silver jewellery in 2013-14
compared to $804 million in 2012-13, a net increase of 77%. It is not
possible to maintain this growth year over year, but certainly this is one
segment which is likely to grow in coming years. Customers have become
highly conscious of quality and prefer 92.5 fineness silver jewellery
nowadays. This trend is likely to improve the efficiency of the market.
The breadth and depth of silver jewellery industry and the silverware
manufacturing in India is simply mind blowing. Not to be left out, there are
growing clusters that cater to silver industrial demand side too. Thus,
India offers an array of manufacturing activity using silver as primary raw
material for a wide range of applications.
According to an Images Retail report, Silver, the New Gold, 2016, the
gems and jewellery industry plays an important part in the Indian
economy, constituting almost 5 % 6% of the overall GDP. Currently, the
overall market stands at $65.9 billion of which the domestic market is
estimated at $36.6 billion and exports at $29.3 billion. The silver jewellery
industry in India has already reached a market potential of $2.1 billion and
is expected to grow by 300 per cent to reach $6.5 billion in the next 35
years.
In the same report it is stated that post globalization, the jewellery market
in India has evolved and is growing in its jewellery consumption pattern. It
is a well-known fact that India is a young country where over 50 per cent
of the population is less than 25 years of age. So the country is divided
between people born prior to 1990 and post 1990. The young consumers
born post 1990 are born in the digital age with computers, internet, social
networking sites, -iPads, mobile phones, smart phones/televisions with
over 100 channels to choose from, etc. This has brought a paradigm shift
in their lifestyle and purchase behaviour. Todays young consumers
explore products on the web and are comfortable making purchases
online. They are looking for great designs in jewellery at affordable prices.
The costume jewellery is unbranded and has generic pieces at less than
INR 2, 000, (USD 30) but has a poor finish. On the other hand, fine
jewellery with gold and diamonds starts at INR 20,000, (USD 298). So
there is a huge gap between INR 2,000 (USD 30) and INR 20,000, (USD

10

298) and that is where silver fits in well and has a great acceptance from
the young audience.
Based on these recent views, this project aims to study the brand
Silverrage, a silver jewellery brand with a growing presence in the online
sector. The aim of the study is to analyse the target audience, and
suggest marketing strategies for them.

Chapter 4: Studying the Brands Target

Group using primary data
Fig 4.1 Do You Purchase Silver Jewellery?

11%
Silver Jewellery Purchase
YES
NO

89%

Out of the 107 respondents, 89% buy silver jewellery, whereas 11% do not
buy silver jewellery

11

TABLE 1 DO YOU PURCHASE SILVER JEWELLERY

SILVER JEWELLERY PURCHASE
YES
NO

NUMBER OF PEOPLE
95
12

Fig 4.2 Frequency of purchase of Silver Jewellery in last one month

ONCE
TWICE

42%

45%

MORE THAN TWICE

NEVER

4% 9%

45% people purchased jewellery once in the last month, 9% purchased

twice in the last month, and 4% bought it more than twice in the last
month. 42% did not buy any silver jewellery in the last one month.
TABLE 2 FREQUENCY OF PURCHASE OF SILVER JEWELLERY IN THE LAST
ONE MONTH

FREQUENCY
ONCE
TWICE
MORE THAN TWICE
NEVER

NUMBER OF
PEOPLE
48
10
4
45

12

Fig 4.3 Major Reason for Purchasing Silver Jewellery

33%

SPECIAL OCCASION
EVERYDAY USE

67%

33% people buy silver jewellery for special occasion, whereas 67% buy for
everyday use.
TABLE 3 MAJOR REASON FOR PURCHASING SILVER JEWELLERY
MAJOR REASON
SPECIAL OCCASION
EVERYDAY

NUMBER OF
PEOPLE
35
70

13

Fig 4.4 Purchase Preference of Silver Items

100
90

94

80
70
60
50
40
30
20
18

10
0

7
JEWELLERY

COINS

IDOLS

3
RAKHIS

1
OTHERS

No of respondents

94 respondents buy silver jewellery, 18 buy coins, 7 buy rakhis, while one
person prefers other
TABLE 4 PURCHASE PREFERENCE OF SILVER ITEMS
WHAT ITEM
JEWELLERY
COINS
IDOLS
RAKHIS
OTHERS

NUMBER OF
PEOPLE
94
18
7
3
1

14

Fig 4.5. Purchase Preference of Silver Jewlery Items

90
80

81

70
60
50
40

44

30
25

20
16

10
0

RINGS

NECKLACES

BANGLES

EARRINGS

TOE RINGS

OTHERS

Overall 44 respondents buy rings, 16 buy necklaces, 25 buy bangles, 81

buy earrings, 6 buy toe rings, and 7 buy others.
TABLE 5 PURCHASE PREFERENCE OF SILVER JEWELLERY ITEMS
WHAT JEWELLERY ITEM
RINGS
NECKLACES
BANGLES
EARRINGS
TOE RINGS
OTHERS

NUMBER OF PEOPLE
44
16
25
81
6
7

15

Fig 4.6 Money spent on jewellery items

30
25
20
15
10
5
0

RINGS/TOE RINGS

EARRINGS

NECKLACES

UNDER 500

INR 500-1000

INR 1500-2000

INR 2000 ABOVE

BANGLES

INR 1000-1500

People spend mostly in the category of INR 500 1000 for all jewellery
articles.
TABLE 6 MONEY SPENT ON JEWELLERY ITEMS
HOW MUCH
YOU SPEND
RINGS/TOE
RINGS
EARRINGS
NECKLACES
BANGLES

UNDER 500

500-1000

10001500

15002000

2000
ABOVE

18
17
8
11

24
26
13
19

9
23
16
14

5
11
9
12

3
16
22
13

16

Fig 4.7 Preference of Purchase Place for Silver Jewlery

11% 1%

BOUTIQUE
LOCAL

32%

BRANDED

23%

ONLINE
OTHERS
33%

33% of respondents prefer buying silver jewellery from locally owned

family jeweller. 32% respondents look for boutiques (like shahpur ja and
hauz khaz) whereas 23% respondents buy silver jewellery from branded
stores like amrapali , tanishq etc. Only 11% respondents shop online and
1% respondents purchase it from other available options.
TABLE 7 PREFERENCE OF PURCHASE PLACE
WHERE DO YOU
PREFER
BOUTIQUE
LOCAL
BRANDED
ONLNE
OTHERS

NUMBER OF
PEOPLE
56
58
40
20
1

17

Fg 4.8 Awareness about a particular brand dealing in Silver Jewellery

10%

Recommendation

5%

Online
Social media
51%

23%

TV
Newspapers

11%

Maximum awareness about a particular store or brand dealing in silver

jewellery , i.e. 51% , is created by recommendation from friends and
family. 23% respondents say that social media helps in brand awareness.
11% respondents gets to know by online advertisement. 10% respondents
know through newspapers and 5% through TV.
TABLE 8 AWARENESS ABOUT A PARTICULAR BRAND DEASLING IN SILVER
JEWELLERY
HOW DO YOU KNOW
Recommendation
Online
Social media
TV
Newspapers

NUMBER OF PEOPLE
78
17
35
8
16

18

Fig 4.9 Online Silver Jewellery Purchase

24%
YES
NO

76%

Only 24% respondents buy silver jewellery online whereas 76%

respondents says they do not buy silver jewellery online.
TABLE 9 ONLINE SILVER JEWELLERY PURCHASE
Silver jewellery Online
YES
NO

NUMBER OF
PEOPLE
26
81

19

Fig 4.10 Future Intention to Buy Online

yes
50%

no

50%

The respondents were divided equally in the intention of buying silver

jewellery online in the future , i.e. 50% respondents intend to buy silver
jewellery online in future.

TABLE 10 INTENTION TO BUY ONLINE

Intention to buy online
Yes
No

NUMBER OF
PEOPLE
52
53

20

Fig 4.11 Reason for Not Buying Silver Jewellery Online

Axis Title

80
70
60
50
40
30
20
10
0

Out of the people surveyed 60% reason for not purchasing online is
because of the quality and 31% do not know where to buy from,13 % of
the people find online more expensive than physical stores and 17% of the
people think that there is no assurance of delivery.
TABLE 11 REASONS FOR NOT BUYING SILVER JEWELLERY ONLINE
REASON FOR NOT BUYING
Dont trust quality
Dont know where to buy from
online
Find online expensive than
physical stores
No assurance of delivery

Yes
60

No
10

31

18

13
17

26
25

21

Fig 4.12 Have you heard about newU Store?

No

No; 40% Yes

Yes; 60%

60% of the respondents have heard about the store and 40% of the
respondents havent heard about the brand till date
TABLE 12 HAVE YOU HEARD ABOUT NEWU STORE
Heard about newU
store
NUMBER OF PEOPLE

NO
42

YES
64

Fig 4.13 Awareness about newU store selling Silver Jewelery

No
Yes; 50%

Yes
No; 50%

22

We had asked 60% of the respondents who had heard about the newU
store if they were aware about the fact that newU sells Silver Jewlery. 50%
of the respondents said that they have heard about silver Jewlery and 50
% of the respondents who knew about newU store havent heard about it.
TABLE 13 AWARENESS ABOUT NEWU STORE SELLING SILVER JEWELLERY
NEWU SELLS SILVER
JEWELLERY
NUMBER OF PEOPLE

NO
32

YES
32

Fig 4.14 Have you ever shopped from newU for silver jewellery?

Yes; 22%

No; 78%

Out of the 60% of the people who have heard about newU ,78% of them
have shopped from the store and 22% have not shopsped from the store.

TABLE 14 HAVE YOU EVER SHOPPED FOR SILVER JEWELLERY FROM NEWU
STORE
SHOPPED FOR
JEWELLERY FROM
NEWU STORE
NUMBER OF PEOPLE

NO
46

YES
13

23

Fig 4.15 Have you heard about either the brand Silverrage or Silvore?

Yes; 19%

No; 81%

81% of the respondents have never heard about Silverage/Silvore and

19% of the respondents have heard about the brand.
TABLE 15 HAVE YOU HEARD ABOUT SILVERRAGE OR SILVORE
HEARD OF
SILVERRAGE/SILVORE
NUMBER OF PEOPLE

NO
84

YES
20

24

Fig 4. 16 how do peple know about the brand Silverrage or Silvore

12
10
8
6
4
2
0
newU Store

Friends and Family

Social Media

Website

Out of the 19 % of the respondents who have heard about the brand
,maximum number of respondents knew about the brand through newU
Store and through recommendation from friends and family and none of
the respondents heard about the brand through websites.
TABLE 16 HOW DO PEOPLE KNOW ABOUT THE BRAND
SILVERRAGE/SILVORE
HOW DI YOU GET TO
KNOW

NUMBER OF PEOPLE

AT NEWU
FRIENDS AND FAMILY
SOCIAL MEDIA
WEBSITE

11
7
7
0

25

Fig 4. 17 Perception of the brand Silverrage

80
70
60
50
40
30
20
10
0

We had shown few pictures of the silver jewelry items sold by

Silverage/Silvore in order know what they think about the brand in terms
of it being fashionable, cotemporary, appropriate for everyday use and
Value for money. Out of the four categories 72% of the
respondents perceived it be fashionable, contemporary and appropriate
for daily use and 61% of the respondents perceive the items to be value
for money.
TABLE 17 PERCEPTION OF BRAND SILVERRAGE
PERCEPTION
FASHIONABLE
CONTEMPORARY
EVERYDAY USE
VALUE FOR MONEY

AGREE
72
70
70
61

DISAGREE
18
16
22
28

26

Fig 4.18. Age bracket of the respondents

50
45
40
35
30
25
20
15
10
5
0

47
42

Column2

Maximum respondents fall under the age category of 18-24 years , i.e.
47 . 42 respondents are under 24-30 years bracket , 6 respondents are in
30-36 and 36-42 years category each. 3 respondens are under 18 years
and 2 respondents are above 42 years.
TABLE 18 AGR BRACKET OF RESPONDENTS
AGE
UNDER 18
18-24
24-30
30-36
36-42
42 ABOVE

NUMBER OF PEOPLE
3
47
42
6
6
2

27

Fig 4.19 Annual income level of the Respondents

35
29

30
25
21
20

20

18

16
15
10
5
0

2-4 lacs

4-6 lacs

6-8 lacs

8-10 lacs

Others

Column2

29 respondents belong to the income bracket of 8-10 lacs , 21

respondents in 4-6 lacs. 20 respondents are under the income bracket of
6-8 lacs , 16 are under 2-4 lacs and 18 respondents said they belong to
other income brackets.
TABLE 19 ANNUAL INCOME LEVEL OF RESPONDENTS
INCOME
6-8 lacs
4-6 lacs
2-4 lacs
8-10 lacs
OTHERS

NUMBER OF
PEOPLE
20
21
16
29
18

28

Chapter 5: Understanding the Marketing Mix

and devising Strategies
To devise Marketing strategies, a detailed study of the segmentation,
targeting and positioning has been performed. The 10 ps have been
elaborated in accordance to the current functioning of the brand and the
projected suggestions based on the research conducted.

Segmentation, Targeting, Positioning

SEGMENTATION
Based on the primary data collected through the consumer survey, the
brand Silverrage can segment its market in the following manner:
1. Geographic: The market is segmented as per the city size and the
density of area. The brand caters to urban Indian women residing in
metropolitan as well as Tier-II cities.
2. Demographic: As per the demographic segmentation, the marketing
survey helped us find out that the brand caters to middle and upper
class women in the age group 18-30 with an annual family income of 810 lakhs.
3. Psychographic: The brand offers its products to Indian contemporary
women who are looking for fashionable jewellery which proves as value
for money.
4. Behavioural: Silverrage provides fashionable jewellery that is
appropriate for everyday use.
TARGETING
Based on the primary data collected through the consumer survey, the
brand Silverrage can target its market in the following manner:
The target market is a set of customers who belong to the age group 1830 with a wide range of income levels on the lookout for contemporary
and fashionable jewellery.
POSITIONING
Silverrage promotes the ideology Silver is the new gold and positions
itself as a fashionable Silver jewellery brand. According to the analysis of
the consumer survey, it is concluded that the brand should position itself
as a brand that offers contemporary silver jewellery that is appropriate for
everyday use and serves as value for money.

29

10 Ps of Marketing
Moving further, the 10 Ps are an extension of the 4 Ps proposed by
McCarthy. The extended Ps help to focus on the Key Performance Area of
the business and perfecting it incrementally. This elaborate marketing
mix, eliminates distractions and allows you to clearly see the strengths,
weakness, opportunities, and threats in each section. So, for Silverrage
going through these one by one, will help us
People
The people who purchase Silver Jewelry are young women, who want
affordable, fashionable jewelry that will help them build a popular,
updated personal style. Silverage/Silvores customer profile lies between
the age of 18-30 years ranging from working women to college students
and homemakers,who prefer buying silver jewelry for everyday wear. Also,
these people have opted for silver as they find gold to be expensive and
silver is a relatively affordable alternative for them. Silver, is also a
preferred option for them as they want an amalgamation of contemporary
and fashionable jewelry at an affordable price with a notion of buying a
semi-precious jewelry.
Product
SIlverrage is defined by its product category. The name speaks for itself.
As already seen, they carry includes a wide range of silver jewellery, along
with silver rakhis, coins and small idols. So the brand name is perfect for
their product.
Silver jewellery has been a part of the Indian society, and Silverrrage only
differentiates it in a manner that they are a few of the online sellers in the
current times. Based on secondary research, and primary data collection
there are a few suggestions.
Product category: As of now they do not sell nose pins. In the primary data
collection, we came across 7% of the respondents who stated that they
like to buy nose pins. So that can be an addition to their product category.
Pricing
Prices for the silver articles by SILVERRAGE varies as according to the
category of the article. They range from INR 295 to INR 8,995. The table
below lists SILVERRAGES product categories and their corresponding
prices.
PRODUCT CATEGORY
NECKLACE
EARRING
FINGER RING

STARTING PRICE
POINT
INR 1,595
INR 895
INR 595

ENDING PRICE POINT

INR 8,995
INR 6,995
INR 1,495
30

BRACELET
TOE RING
SILVORE
COINS

INR
INR
INR
INR

1,495
595
295
595

INR
INR
INR
INR

5,795
1,195
795
5,995

Positioning
Currently, the brand is positioned as a fashionable silver jewellery brand,
that caters to the contemporary woman.
A suggestion is that most of their product is handcrafted, and it is
something that the brand can encash on. In todays world, hand crafted,
and artisanal add value to any product, and people are ready to pay a
price for the benefit of the craft. They can promote their product, as an
artistic product, crafted by the hands of a skilled artisan.
Placement
SILVERRAGE products are sold through various retail channels; including
its online store, www.silverrage.com . It marks its presence in brick and
mortar retail stores through Archies (gift store) and NewU (personal care
store) in various locations. Also, ventures with e-tailors, Flipkart and
Amazon are in pipeline.
In accordance to the research carried out, SILVERRAGE can expand its
presence in the market by tapping various mall and hotel exhibitions
which will help SILVERRAGE spread awareness about the brand and its
products. Fashion exhibitions can prove to be of great advantage to
capture the target market of SILVERRAGE. Handicraft exhibitions like
Natures Bazaar and community events provide a platform to showcase
and sell handcrafted products that will be beneficial for SILVERRAGE.
Presentation
Online: The SILVERRAGE website is customer friendly and is aesthetically
appealing. The product display is very clean and appropriate description is
mentioned for each product.
To further improve the presentation of the products the following things
shall be added as a part of product description to enable the customer to
make a well informed choice:

DIMENSIONS Adding the exact dimensions of the products is a

critical factor in determining consumer preference, especially in
case of precious metals like silver. The website currently lacks
information about the dimensions for all jewellery items which does
not provide a holistic view of the product offered.
WEIGHT Since silver is priced by weight, it is important to include
the weight of product in the description, as it is an influential factor
determining the purchase. This will ensure more customer
transparency regarding the product and will give SILVERRAGE an
edge over its competitors.

31

Brick & Mortar: The SILVERRAGE and SILVORE merchandise is displayed on

a tripod in newU stores which camouflages with the surroundings and
therefore, does not garner much attention of the customers. The brand
should improve the design of the tripod in order to attract more customers
and should improve the branding by emphasizing on the fact that they
offer silver jewellery.
Along with this, the placement of the tripod shall also be changed as it is
set up in a very congested space in majority of the stores.
Promotion
Due to lack of monetary resources, we will be developing a more cost
effective way to promote the brand.
Enhance Web Presence
As more people are switching towards online shopping and according to
our survey 50% of the people who do not purchase Silver Jewelry online
are willing to switch towards online medium. Hence, more efforts need to
be made to enhance web presence. In order to do so Silver age could use
the the following promotional techniques.
Blogs- Tie up with fashion bloggers in order to reach and inform potential
buyers. Also, through bloggers they can easily reach their target group
and it is a good way of networking with other people in the business.
Online Referral System-As per our survey 51 % of the respondents get to
know about a particular Silver Jewelry brand through recommendation
from family /friends. Hence, Silverrage can introduce an online referral
system through which the shopper can recommend their website to
people and based on that they will be entitled to get 10% discount on
each referral.
Direct Feedback-Enable a mini survey tool on their website and ask
question to visitors about their shopping experience and the products
perceived value. The customer can comeback and leave reviews about
their purchase and if the product is a hit, they can re-order that product
before the product goes out of stock.
CRM System - As Silverrage needs to know its customers more in detail
compared to current situation and maintain a relationship with their
clientele. It is recommended that Silverrage should create CRM System,
which will make it easier for them to keep track of the activity of its
customers. This system can be created by providing following facilities to
customers

Saving credit card details for faster shopping

Manage order history

Gaining access to the wishlist

Track Orders Easily

Seasonal and Festive Discount - These discounts can be used to get rid of
their old stock and increase their brand awareness. As Silver articles are

32

high in demand during festivals, hence to lure these customers to the

brand, the discounts can be offered.
Packaging
Presently, Silverrage packages their lower value products on a cardboard,
and a plastic seal pack. Their higher range is packaged in a cardboard
jewellery box.
Working on the lines of adding value to the product, SIlverrage can work
on their packaging, to make the whole experience of buying a new piece
of jewellery a memorable one. Keeping this in mind, it is also practical to
ensure that this does not add unnecessary cost to the product. They can
have a fancy packing for the higher range of their products rather than
to the whole range. The new look can include a handcrafted element to go
with the whole proposed feel.
Processing
SILVERRAGE is a team of 40 artisans who are equipped with latest
technology and machinery. Carefully designed and patterned lay-outing is
casted through Lost Wax Casting. A variety of finishes are achieved
through a varied range of polishes, ultrasonic cleaners and steam
pressures are used. To cater to the rising demand , a Centrifugal Polishing
machine has been set up. The plating , which ranges from silver plating ,
nickel free rhodium plating to micron gold plating , is carried out in-house
with extreme precision and care.
Playback
SILVERRAGE as of now does not take into account any feedback in an
organised form from its consumers in question. This refrains SILVERRAGE
from understanding its consumer behaviour towards the silver articles
they are offering and the way they carry out operations. It can utilize the
consumer research carried out in order to learn about the wants, needs
and preferences of the target consumer as well as to learn of any
improvements that can be made to the strategies.
They have in place a good return and exchange policy. This should help
them create a greater customer base and loyalty.

33

SWOT Analysis

STRENGTHS

WEAKNESSES

High-quality products
Unique construction methods
Handcrafted jewellery
A comprehensive distribution
network

Lack of promotion
Lack of customer awareness
about the brand
No brand recall
No customer relationship
management
The product breadth and depth is
narrow and deep

OPPORTUNITIES

THREATS

Offer customisation
Improvise on packaging
Participation in exhibitions
Tie-up with fashion bloggers
Offer discounts/promotional
offers

Threat from local retailers and

branded stores
Threat from imitation jewellery
Threat of new entrants

34

Chapter 6: Analysis
Hypothesis testing using Chi square has been done
S.No.

NULL HYPOTHESIS

Online purchasing
and age are
independent

Income and
awareness about
newU store of
independent

OUTCOME

COMMENTS

Rejected

Customers belonging
to a certain age
group would resort
to online purchase
and vice-versa

Not rejected

newU caters to
customers belonging
to a wide range of
Income levels

35

HYPOTHESIS 1
H : Online purchasing and Age are independent
H1: Online purchasing and Age are dependent
Hypothesis testing is done at = 0.05
F
AGE/ONLI
NE
PURCHAS
YES
NO
TOTAL

Under
18
years
3
0
3

18-24
years

24-30
years

30-36
years

36-42
years

12
35
47

9
33
42

1
5
6

0
6
6

F e
AGE/ONLIN
E PURCHAS
YES
NO
TOTAL

Under 18
years
3X25/10
6=
0.7075
3X81/10
6=
2.2925
3

Table
Above
42
years
0
2
2

TOTAL
25
81
106

Table

18-24
24-30
30-36
36-42
years
years
years
years
47X25/10 42X25/10 6X25/10 6X25/10
6=
6 = 9.9056 6 = 1.415 6 = 1.415
11.0849
47X81/10 42X81/10 6X81/10 6X81/10
6 = 35.915 6 = 32.09
6=
6=
4.5849
4.5849
47
42
6
6

Above 42
years
2X25/10
6=
0.4716
6X81/10
6=
1.5283
2

TOTAL
25
81
106

36

CALCULATIONS
F
3
0
12
35
9
33
1
5
0
6
0
2

x2

F e

0.7075
2.2925
11.0849
35.915
9.9056
32.09
1.415
4.5849
1.415
4.5849
0.4716
1.5283

( F F e )2
Fe

F e

2.29
-2.29
0.92
-0.92
-0.91
0.91
-0.42
0.42
-1.42
1.42
-0.47
0.47

F F e
2

5.2441
5.2441
0.8464
0.8464
0.8281
0.8281
0.1764
0.1764
2.0164
2.0164
0.2209
0.2209

(F F e)2 /F e
7.386
2.29
0.076
0.024
0.084
0.026
0.124
0.039
1.42
0.440
0.47
0.144
2
( F F e )
=12.523
Fe

= 12.523

df = (r-1)(c-1) = (2-1)(6-1) = 5
At df = 5 and = 0.05

The critical value (using chi square table) = 11.070

Since, 12.523 > 11.070
Hence, null hypothesis is rejected.
CONCLUSION: It can be concluded that age of the customer and online purchase
of silver jewellery made by them are dependent variables. Hence, they are
related.

37

HYPOTHESIS 2
H : Income and awareness about newU store are independent
H1: Income and awareness about newU store are dependent
Hypothesis testing is done at = 0.05
F
INCOME/AWAREN
ESS ABOUT newU
YES
NO
TOTAL

Table

2-4 lacs

4-6 lacs

6-8 lacs

9
7
16

14
7
21

13
7
20

F e

8-10
lacs
12
17
29

OTHERS

TOTAL

15
3
18

63
41
104

Table

INCOME/AWAREN
ESS ABOUT newU

2-4 lacs

4-6 lacs

6-8 lacs

8-10 lacs

OTHERS

TOTAL

YES

63X16/1
04 = 9.69

21X63/1
04 =
12.72

20X63/1
04 =
12.12

29X63/1
04 =
17.57

18X63/1
04 =
10.90

63

38

NO
TOTAL

16X41/1 21X41/1 20X41/1

04 = 6.31 04 = 8.28 04 = 7.88
16

21

20

29X41/1
04 =
11.43
29

18X41/1
04 = 7.10

41

18

104

CALCULATIONS
F
9
7
14
7
13
7
12
17
15
3

F e

9.69
6.31
12.72
8.28
12.12
7.88
17.57
11.43
10.90
7.10

( F F e )2
Fe

F e

-0.69
0.69
1.28
-1.28
0.88
-0.88
-5.57
5.57
4.1
-4.1

F F e
2
O.476
0.476
1.638
1.638
0.774
0.774
31.025
31.025
16.81
16.81

(F F e)2 /F e
0.049
0.075
0.129
0.198
0.064
0.098
1.766
2.714
1.541
2.368
( F F e )2
=9.002
Fe

= 9.002

df = (r-1)(c-1) = (2-1)(5-1) = 4
At df = 4 and = 0.05

The critical value (using chi square table) = 9.488

Since, 9.002 < 9.488
Hence, null hypothesis is accepted.
CONCLUSION: It can be concluded that Income of the customer and awareness
about newU store are independent variables. Hence, they are not related.

39

Chapter 7: Conclusions
1. The consumer survey provided insights into the consumers perception
about the brand and helped understand the brand positioning.
2. The secondary data research helped to find out the brands potential in
the silver jewellery market.
3. The primary data collection and analysis also helped to suggest
marketing strategies to improve the brand presence of Silverrage in
India.
4. The analysis of the sample consumer survey helped understand
Silverrages target customer group.
Therefore, the research carried out would help the brand change the
positioning and incorporate suggested marketing strategies to increase
the brand presence and sales in India.

Limitations
The study has attempted to delve into some of the important issues.
However it is admitted that there are some limitations in the conduct of
this study.
The research has been completed in a limited time. It is therefore, not
possible to see the effects of the recommendations made.

40

The possibility of errors introduced into the primary data due to

insufficient or imprecise information provided by people.
The sample size has been limited so as to make this study manageable,
and fit into the curriculum timeline
The conclusion, therefore, are subject to aforesaid constraints and are
only exploratory and suggestive in nature.

Bibliography
http://www.indiaretailing.com/2016/02/14/retail/silver-the-new-gold-2/
http://www.mckinsey.com/industries/retail/our-insights/a-multifacetedfuture-the-jewellery-industry-in-2020
www.silverinstitute.org
Silver Jewellery Report Global ; By, GFMS Ltd, For the Silver Institute
(March 2007)

41

List of Figures
List of Figures
Figure
no
Fig 4.1
Fig 4.2
Fig
Fig
Fig
Fig
Fig

4.3
4.4
4.5
4.6
4.7

Fg 4.8
Fig
Fig
Fig
Fig

4.9
4.10
4.11
4.12

Fig 4.13
Fig 4.14
Fig 4.15
Fig 4. 16

Contents

Pg No.

Do You Purchase Silver Jewellery?

Frequency of purchase of Silver Jewellery in last
one month
Major Reason for Purchasing Silver Jewellery
Purchase Prefrence of Silver Items
Purchase Preference of Silver Jewlery Items
Money spent on jewellery items
Preference of Purchase Place for Silver Jewlery
Awareness about a particular brand dealing in
Silver Jewellery
Online Silver Jewellery Purchase
Future Intention to Buy Online
Reason for Not Buying Silver Jewellery Online
Have you heard about newU Store?
Awareness about newU store selling Silver
Jewelery
Have you ever shopped from newU for silver
jewellery?
Have you heard about either the brand Silverrage
or Silvore?
How do peple know about the brand Silverrage or

42

Fig 4. 17
Fig 4.18.
Fig 4.19

Silvore
Perception of the brand Silverrage
Age bracket of the respondents
Annual income level of the Respondents

List of Tables
List of Table
Table no Contents
Table 4.1 Do You Purchase Silver Jewellery?
Frequency of purchase of Silver Jewellery in last
Table 4.2
one month
Table 4.3 Major Reason for Purchasing Silver Jewellery
Table 4.4 Purchase Prefrence of Silver Items
Table 4.5 Purchase Preference of Silver Jewlery Items
Table 4.6 Money spent on jewellery items
Table 4.7 Preference of Purchase Place for Silver Jewlery
Awareness about a particular brand dealing in
Table 4.8
Silver Jewellery
Table 4.9 Online Silver Jewellery Purchase
Table
Future Intention to Buy Online
4.10
Table
Reason for Not Buying Silver Jewellery Online
4.11
Table
Have you heard about newU Store?

Pg No.

43

4.12
Table
4.13
Table
4.14
Table
4.15
Table 4.
16
Table 4.
17
Table
4.18.
Table
4.19

Awareness about newU store selling Silver

Jewelery
Have you ever shopped from newU for silver
jewellery?
Have you heard about either the brand Silverrage
or Silvore?
How do peple know about the brand Silverrage or
Silvore
Perception of the brand Silverrage
Age bracket of the respondents
Annual income level of the Respondents

Annexure 1
Questionnaire
The purpose of this questionnaire is to ascertain the consumers perception
regarding silver jewellery and the jewellery brand Silverrage. This questionnaire is
framed for the purpose of a Marketing Research carried out by the students of NIFT

44

Delhi. All answers provided by you will be treated as confidential information. Thank
you for volunteering to participate in the study.
1. Do you wear Silver jewellery?
Yes

No

2. In the last 1 month, have you purchased Silver jewellery? (Choose any 1)
Once

Twice

More than twice Never

What is your major reason for Silver jewellery purchase ?

Special Occasions

Everyday Use

What Silver items do you generally purchase? (Choose 1 or more)

Jewellery

Silver Coins &

Showpieces

Rakhis

Others (please specify)_________________________

Amongst the following, which silver jewellery items do you generally

purchase? (Choose 1 or more)

Rings

Necklaces
Bracelets/Bangles
Toe

Notes Idols &

Earrings
Rings Others (please specify)

How much would you spend when you buy Silver jewellery? (Choose 1 in each
category)
Less than
INR 500

INR 5001000

INR 10001500

INR 15002000

Above INR
2000

RINGS/TOE
RINGS
EARRINGS
NECKLACCES
BRACELETS/BAN
GLES

45

Where would you prefer buying Silver jewellery from? (Choose 1 or more)
Boutique (like Shahpur Jat, Hauz Khas, Greater Kailash etc.)
Locally owned family jeweller
Branded store (E.g. Amrapali, Tanishq, Kalyan etc.)
Online
Others (please specify)

How do you get to know about a particular store or brand dealing in Silver
jewellery? (Choose 1 or more)

TV

Advertisement/Pamphlets in
Advertisements

newspapers

Recommendation from friends/relatives

Advertisements

Online

Social Media (Facebook, Instagram etc.)

Google, Youtube etc.)

(Advertisements on

Have you ever purchased Silver jewellery online?

Yes

No

10 Do you intend to buy Silver jewellery online in the future?

Yes

No

11 If your answer for Question 9 is YES, which website(s) do you prefer to buy
silver jewellery from?

12 If your answer for Question 9 is NO, please advise the reason.

YES

NO

Dont trust the quality online

46

Dont know where to buy from online

Find online expensive than physical stores

No assurance of delivery
Other Reasons ____________________________________________________________
13 Have you heard about NewU store?
Yes

No

*If NO, skip to question No. 15

14 Does NewU sell Silver jewellery?

Yes

No

15 If YES, have you shopped for Silver jewellery from NewU store?
Yes

No

16 Have you heard of the brand either SILVERRAGE or SILVORE ?

Yes

No

17 If YES, where did you hear about the brand either SILVERRAGE or SILVORE?
(Choose whichever option is applicable)
At NewU
website
Social media (Facebook/Instagram)
18 Below are a few designs of SILVERRAGEs silver
your opinion these are:

From their
Friends and Family
jewellery. In

FASHIONABLE
AGREE DISAGREE
COMTEMPORARY
AGREE DISAGREE
APPROPRIATE FOR EVERYDAY USE
AGREE
DISAGREE
VALUE FOR MONEY
AGREE DISAGREE

47

Please choose the appropriate answer.

Medium oxidized silver

rava stud with blue
turquoise priced at
Rs.1,295.00

Oxidized Bali Poornima priced at

Rs.1,795.00

Stone necklace set with

rhodium finish priced at
Rs.4,995.00

Ring priced at Rs.4,595.00

19 Which age bracket do you fall in?

Under 18 yrs

18-

24 yrs

24-30 yrs
30-36 yrs

36-42 yrs

Over 42 yrs

20 Which income bracket does your family belong to? (Choose any 1)
INR 2- 4 lacs

INR 4- 6 lacs

INR 6-8 lacs

48

INR 8-10 lacs

Others (Please
specify)_________________________

Appendix 1
Silver Jewellery Report 2015 (USA)
2015 Silver Jewellery Sales Results
Introduction Silver has become an increasingly important category for
many jewelers over the past several years, both in driving sales and
providing margin. To determine specifics on market performance and help
support the category's further growth, the Silver Promotion Service
partnered with National Jeweller for the seventh year in a row to field a
market measurement study.
Objectives Jewellery Retailers were surveyed to determine:
How 2015 silver jewellery sales compared to 2014.
How 2015 holiday sales for silver jewellery compared to the 2014
season.
Which merchandise categories had the best maintained margin over the
2015 holiday season?
What price points of silver jewellery have the greatest amount of sales?
How silver jewellery performs compared to other categories in their
store.
Whether they increased their inventory of silver jewellery in 2015.
Which category had the best inventory turnover rate?
What age groups are buying the most silver jewellery and where they
see their best selling opportunities with silver?
What were the two best-selling silver styles/trends and 2015 and which
will have an increased importance in 2016.
How important silver jewellery is to their business.
How optimistic they are that the current silver boom will continue for the
next several years.

49

Methodology The survey was conducted online from January 21 to March

13, 2016. The questionnaire was sent to a total of 33,555 National
Jeweller subscribers. As of March 13, 149 retailers had responded and
form the basis for this report.
Summary 60% of the jewellery retailers said their silver jewellery sales
increased in 2015. 22% said their silver jewellery sales remained the same
and 18% saw a decrease in sales.
42% said their silver jewellery sales increased between 11 and 25%. 8%
saw an increase over 25%. The average increase in 2015 for silver
jewellery sales was 15%.
48% of the jewellery retailers said their 2015 holiday season sales of
silver jewellery increased over the 2014 holiday season. Twenty-nine
percent said their holiday season silver jewellery sales remained the same
while 23% said their sales decreased.
The following merchandise categories gave retailers the best maintained
margins during the holiday season: (Percent rating category as "best")
Silver Jewellery 45% Diamond Jewellery 27% Bridal Jewellery 16% Gold
Jewellery 9% Platinum Jewellery 3%
45% said silver experienced the best inventory turnover rate in 2015;
22% said diamond, 17% bridal, 12% gold and 4% platinum.
The two best price points where retailers are experiencing the greatest
amount of sales in silver jewellery are $100 - $500 (42%) and less than
$100 (48%). Price Point Range More than $1,000 2% $501 - $1,000 8%
$100 - $500 42% Less than $100 48%
Retailers said their silver jewellery sales as a percentage of their overall
jewellery sales was on average 35% of their unit volume and 27% of their
dollar volume. Expressed as a median, silver jewellery sales were 25% of
their unit volume and 16% of their dollar sales volume.
57% increased their inventory of silver jewellery in 2015 an average of
21%.
The age group buying the most silver jewellery is 20 - 40 according to
58% of the retailers. The 41 - 50 age group was second. Over 60 1% 51-60
6% 41-50 20% 20-40 58% under 20 15%
Retailers say the best-selling opportunity with silver is female selfpurchase followed by gifting. Female self-purchase 46% Gifting 34% Youth
market 17%
62% say silver jewellery is very important or important to their business;
37% said very important.
87% say they are optimistic that the current silver boom will continue
for the next several years; 46% said they were very optimistic.
75% of the respondents are independent retailers, 5% jewellery chains,
2% department stores and 18% other.
Respondents were from across the country. New England 7% Middle
Atlantic 25% East North Central 11% West North Central 6% South Atlantic
17% East South Central 2% West South Central 4% Mountain 4% West
12% Other (Canada/across US, etc.) 12%

50

 65% of the retailers operate one physical store, 18% operate two or
more stores and 17% were online only.
Annual per store sales for respondents are $1,500,000.
SPECIAL QUESTIONS: 25% said social media plays an important role in
the consumers purchase consideration. (Respondents rating a 5 or 4 on a
5 point importance scale).
Retailers say requests by customers and recommendation by other
retailers are most important in determining whether to carry a new silver
collection/brand. (Percent rating 5 or 4 on a 5 point importance scale)
Requests by customers 78% Recommendation by other retailers 55%
Reputation of sales representative 46% The Brands consumer
advertising/PR 43% The Brands trade show presentation 31% As seen in
industry publication/articles 25%
Price point, recommendations/referrals by sales staff and brand
recognition are the most influential factors in motivating a customer to
buy. (Percent rating 5 or 4 on a 5 point influential scale) Price point 83%
Recommendations/referrals by sales staff 62% Brand recognition 60%
Social media 30%
Retailers are spending 23% of their annual marketing dollars on print
advertising. Print advertising 23% Promotions/events 19% Online
ads/website 18% Social media 14% Direct mail/catalogues 9% Staff
training/education 11% Other 6%

Appendix 2
Silver Jewellery Report Global
By, GFMS Ltd
For the Silver Institute (March 2007)
EXECUTIVE SUMMARY: One of the prime objectives of this Report has been
to produce for the first time separate detailed statistics for silver jewellery
and silverware fabrication. The data we have produced show that global
silver jewellery output stood at 146.4 Moz (4,554 t) in 1996. Production
then increased, albeit somewhat erratically, to reach a record level of
176.7 Moz (5,495 t) in 2003. In the next two years, demand fell back a
little, reaching 171.8 Moz (5,345 t) in 2005. This decline largely centred on
the price-sensitive Indian market, with double digit prices having had only
a marginally negative impact on demand in most other countries. The
importance of India to the global picture is evident from the fact that since
2001 its production of silver jewellery has nearly halved. In 2005, India
51

accounted for just over 10% of global fabrication demand compared to no

less than 23% in 1996. (As we explain elsewhere in this Report, price
factors alone do not explain the secular decline in Indian demand in
recent years.) Indeed, looking at global jewellery output excluding India
the growth picture is a far stronger one: output in the rest of the world
surged from 112.6 Moz (3,504 t) in 1996 to a peak of 155.6 Moz (4,842 t)
in 2004 before dropping back to 153.8 Moz (4,785 t) in 2005. India was
the third largest fabricator of silver jewellery in 2005. Its output of 18.0
Moz (560 t) was eclipsed by Thailand with 32.3 Moz (1,005 t) and Italy
with 31.5 Moz (980 t). Silver jewellery fabrication is highly concentrated:
together the top-5 countries (the other two being China and Mexico)
account for two-thirds of global production. This compares to a Tableure of
56% achieved by gold jewellerys top-5 in 2005. Within this top-5 group,
growth in output in the last ten years has been spectacular in Italy,
Thailand and China. In all three cases exports have been the driving force
behind the expansion. However, it is significant that Italian production
peaked in 2000, since when it has declined and that Thai output has
apparently reached something of a plateau in recent years. The
explanation for these developments is largely the ramping up of low-cost
exports from China. China has played a key part in the over 90% increase
in the value of global silver jewellery trade between 2000 and 2005. On a
consumption basis, the global rankings are rather different. The United
States with 53.7 Moz (1,670 t) was by far the largest silver jewellery
market in 2005, accounting in fact for no less than 31% of global
consumption. A distant second with 14.7 Moz (457 t) that year was India,
with Germany taking the bronze medal on 12.0 Moz (375 t). Global silver
jewellery consumption is less concentrated than fabrication, in the case of
the former, the top-5 consuming countries together accounting for 58% of
the global total in 2005. It is interesting to note that silver jewellerys
share of global silver demand rose slightly from 18.0% to 18.8% in the
1996-2005 period. This increase was limited due to the more rapid growth
in industrial fabrication over the same period (in spite of the decline in
photography) plus, more recently, the appearance of investment on the
demand side of the equation. (Note: Narrowing the analysis just to
fabrication demand, silver jewellerys share rose from 18.4% in 1996 to
19.9% in 2005.) Globally, twice as much silver as gold ends up in jewellery
and demand for these two metals also dwarfs that for platinum and
palladium. Taking all four precious metals together, silvers share of total
precious metals jewellery volume increased from 60.5% in 1999 to 65.6%
in 2005. On an individual country basis, however, there are large
differences in the ratio of silver: gold jewellery consumption. At one
extreme is Germany with a ratio of 15.3:1 in 2005, while at the other we
find India at 0.8:1. Consumption in the United States is skewed towards
silver, with a ratio in 2005 of 4.8:1, while in China its ratio of 0.3:1
indicates a very clear preference for gold over silver. These differences
highlight an important point borne out in our research and discussed in
Chapter 5: the enormous variation in the cultural acceptance of silver as a
precious metal and, importantly, its status versus gold. On a value basis,
of course, the tables are turned and gold is by far the dominant precious

52

metal. Indeed, basis a simple calculation of the precious metals value of

jewellery (using annual average prices), in 2005 silver was relegated into
third place behind platinum. However, in reality, and particularly at the
retail level, silver holds its own rather better in the value stakes due to the
much higher mark-ups on silver than on gold, platinum or palladium
jewellery. For example, whereas much plain gold jewellery sells in western
markets at retail for roughly three times the intrinsic metal value, in the
case of silver the multiple will be at least 10 times. On a global basis this
difference is likely to be wider still as mark-ups are very low on the large
volume of high karat gold jewellery sold in many of its key Asian markets.
(It is worth noting that, unlike gold, silver jewellery consumption is still
heavily skewed towards western markets.) One result of the very much
higher mark-ups on silver jewellery is that the increase in the metals
price has been absorbed more easily than in the case of gold or platinum
where retail prices have had to be significantly increased or products
lightened to preserve margins. The increase in platinum and gold prices
has though not been entirely to silvers benefit as it has also generated
more interest in non-precious metal and mixed material jewellery, in the
former case a major beneficiary being heavily promoted steel jewellery.
Price is of course only one factor at work in terms of the level of silver
jewellery demand. Indeed, given the relatively low price sensitivity of
silver jewellery demand to price, with the exception of India (see Chapter
7), other factors are especially important in determining demand for silver
jewellery. We have already mentioned the importance of non-price factors
in driving down Indian consumption over recent years. In other countries
too, as we explain in detail in Chapter 6, competition for silver jewellery
comes not only from other metals but also alternative avenues for
consumer expenditure such as branded luxury or technology goods. In
addition, there is the important role played by fashion and taste, which
may change over time in terms of e.g. preference for jewellery colour. In
the light of the above, what is the outlook for silver jewellery demand? On
the assumption that there is no further large rise in silver prices, our view
is that there is scope for moderate growth in global off take over the next
few years. We do not expect much of an advance in Europe or North
America but neither do we believe that there will be a major reversal in
consumption in these regions. Meanwhile, after suffering massive
setbacks in recent years, consumption in India should stabilize and even
recover somewhat. Furthermore, if silver prices were to fall back then
demand in India would be expected to respond
positively. Elsewhere, and particularly in China,
demand should grow from its currently low level.
Increased consumption is most likely to be seen in
the youth and young adult market and this would
be aided by the promotion of branded silver
jewellery.

53

Appendix 3
A multifaceted future: The jewellery industry in 2020
A report by McKinzey
SUMMARY: Annual global sales of 148 billion are expected to grow at a
healthy clip of 5 to 6 percent each year, totaling 250 billion by 2020.
Consumer appetite for jewellery, which was dampened by the global
recession, now appears more voracious than ever.
o Five trends will shape the jewellery industry - internationalization
and consolidation, the growth of branded products, a
reconTableured channel landscape, hybrid consumption, and
fast fashion.
o The jewellery industry is primarily local. The ten biggest jewellery
groups capture a mere 12 percent of the worldwide market, and
only twoCartier and Tiffany & Co.are in Interbrands ranking of
the top 100 global brands. The rest of the market consists of
strong national retail brands, such as Christ in Germany or Chow
Tai Fook in China, and small or midsize enterprises that operate
single-branch stores.
o Handful of thriving national or regional jewellery brands will join
the ranks of top global brands by 2020Swarovski is an oft-cited
example.
o Some local brands will almost certainly become known globally as
a result of industry consolidation: international retail groups will
acquire small, local jewelers.
o Some industry observers project that the ten largest jewellery
houses will double their market share by 2020, primarily by
acquiring local players.
o Average deal value in jewellery has been risingby a compound
annual growth rate of 9 percent between 1997 and 2012,
compared with 5 percent in apparel.
o Branded jewellery accounts for only 20 percent of the overall
jewellery market today, its share has doubled since 2003 (Exhibit
1)
o Most expect that the branded segment will account for 30 to 40
percent of the market in 2020.

54

o Three types of consumers driving the growth of branded jewellery:

o young consumers who turn to brands as a means of selfexpression and self-realization
o Online jewellery sales are only 4 to 5 percent of the market today,
with substantial variations across regions, brands, and types of
jewellery. This numberat least for fine jewellerywill reach 10
percent by 2020 and wont grow much beyond that. Their
rationale: most consumers prefer to buy expensive items from
brick-and-mortar stores, which are perceived as more reliable and
which provide the opportunity to touch and feel the merchandise
a crucial factor in a high-involvement category driven by
sensory experience.

Appendix 4
Silver, the new Gold - Images Retail
The gems and jewellery industry plays an important part in the Indian
economy, constituting almost 56 per cent of the overall GDP. Today, the
overall market stands at Rs. 4, 50,000 crore of which the domestic market
is estimated at Rs. 2, 50,000 crore and exports at Rs. 2, 00,000 crore. The
domestic gems and jewellery industry is estimated to reach Rs. 7, 20,000
crore by 2018. The sheer size of this industry provides direct employment
to roughly 2.5 million people and has the potential to generate additional
employment of 0.71.5 million over the next five years.
The silver jewellery industry in India has already reached a market
potential of Rs. 15,000 crore
Today, the silver jewellery industry in India has already reached a market
potential of Rs. 15,000 crore and is expected to grow by 300 per cent to
reach Rs. 45,000 crore in the next 35 years. Even within the export
category, GJEPC has reported the fastest growth in silver jewellery
exports. The exports for silver jewellery have doubled in the past couple of
years, owing to the trending demand for silver jewellery in the
international market.
So what is driving the change and growth in silver jewellery market?
Post globalization, the jewellery market in India has evolved and is
growing in its jewellery consumption pattern. It is a well-known fact that
India is a young country where over 50 per cent of the population is less
than 25 years of age. So the country is divided between people born prior
to 1990 and post 1990. The young consumers born post 1990 are born in
the digital age with computers, internet, social networking sites, -iPads,

55

mobile phones, smart phones/televisions with over 100 channels to

choose from, etc. This has brought a paradigm shift in their lifestyle and
purchase behaviour. Todays young consumers explore products on the
web and are comfortable making purchases online. They are looking for
great designs in jewellery at affordable prices. The costume jewellery is
unbranded and has generic pieces at less than Rs. 2,000, but has a poor
finish. On the other hand, fine jewellery with gold and diamonds starts at
Rs 20,000. So there is a huge gap between Rs. 2,000 and Rs 20,000, and
that is where silver fits in well and has a great acceptance from the young
audience.
Nowadays, it is believed that the way you dress is the way you get
addressed. The contemporary Indian women today adorn jewellery as an
expression of their individuality and attitude. Changing lifestyles has
presented an opportunity for women to dress differently on various
occasions. A woman sports different looks for social events, parties, family
functions, weddings, and other important occasions. So it may be a
casual, sporty, classy, traditional, and sexy or any other look. For every
look she needs to adorn herself with complimenting jewellery. Silver
jewellery provides her exactly with these options at affordable prices.
Silver being cheaper gives excellent scope for creativity and design
innovations. It presents opportunities that are not possible with gold and
diamond. Design has become the key differentiator in the affordable
jewellery segment. Consumers today prefer jewellery that they can adorn
and make a personal statement. The young believe in adornment and in
indulgence unlike the older days, where jewellery was meant more for
securing in lockers than for wearing purposes.
Growing e-commerce or online market and steep fashion jewellery
demand is driving the push for silver jewellery in the upward trend. A
number of big brands are venturing into the BIS 925 sterling silver
jewellery segment.
Silver is projected to be the new gold in the next five years with respect to
investment and personal jewellery preferences. The trendy silver jewellery
that a woman adorns is expected to give a substantial appreciation in the
coming years. So it is time you make your personal style statement with
sterling silver jewellery.
Summary:
o The gems and jewellery industry plays an important part in the Indian
economy, constituting almost 56 per cent of the overall GDP.
o Today, the overall market stands at Rs. 4, 50,000 crore of which the
domestic market is estimated at Rs. 2, 50,000 crore and exports at Rs.
2, 00,000 crore.

56

o The sheer size of this industry provides direct employment to roughly

2.5 million people and has the potential to generate additional
employment of 0.71.5 million over the next five years.
o Today, the silver jewellery industry in India has already reached a
market potential of Rs. 15,000 crore and is expected to grow by 300
per cent to reach Rs. 45,000 crore in the next 35 years.
o The exports for silver jewellery have doubled in the past couple of
years, owing to the trending demand for silver jewellery in the
international market.

Appendix 5
Silver Jewellery Market in India
India is a huge exporter of silver jewellery and silverware. Huge demand
for silver is seen from countries like the United States and those in the
Middle East. In terms of silver jewellery, India is the third largest fabricator
of silver jewellery in the world. The popularity of silver in India also stems
from the fact that it is cheap in comparison to gold and other precious
metals like platinum. This makes it easier for people to buy silver for
themselves as well as for gifting purposes.
Silver jewellery in India is currently popular not just due to its lower prices
but also because several designer stores and jewellery designers have
entered this space. These new-age designers are giving a new and trendy
look to silver jewellery and gifting articles and have clearly created
substantial demand for the white metal. Surveys done in this regard have
revealed that youngsters especially have started appreciating silver better
than gold because the current jewellery designs are so much more chic

57

and aptly proceed as compared to the same designs made out of gold or
platinum.
Indians are fond of jewellery items like earrings, necklaces, toe-rings,
anklets, rings and so on. Hence, silver finds sufficient demand in the
jewellery sector of the country. Different states of India have different
preference for silver items. Like silver anklets and silver toe rings are
considered important bridal jewellery for people in North India as well as
for those in certain states of South India. Similarly, giving away silver
coins as tokens of love or as return gifts, is considered auspicious during
Indian weddings.
Silver Jewellery and Corresponding Prices
While silver jewellery in the country takes into account the making
charges too, silver coins and bars in their purest form are increasingly
becoming a major source of investment as they are priced optimally. The
tradition of gifting silver coins during weddings and festivals is a tradition
that has been upheld by Indians till now. With the price appreciation that
silver has seen in recent times, the demand for silver jewellery has been
falling for the past few years. There has been as much as 33%
appreciation in the price of silver and hence the reason of it being viewed
more as an investment option than a commodity. Also, jewellery is just
one part of the demand for silver, there are other articles too that are also
in demand, like silverware, dinnerware, tableware, dcor items etc. These
articles are considered ideal for gifting and for use on any auspicious
occasion

Appendix 6
Silver Jewellery and Accessories Market in India
bullionbulletin.in
Silver which in India has been known as a poor mans gold is finding its
space with professional investors. Its contribution in the various industrial
sectors as a raw material makes it unmatchable and no other metal can
replace Silver due to its electrical and thermal conductivity. It has an
endless number of uses both from the fabrication to the investment
sectors. The total physical demand for silver in 2013 was 33,624 tons of
which industrial off take were 54%, followed by investments, jewellery and
silverware. And share of India was 17% of the total demand.
Coins and Medals

58

The logical alternative for customers which did not have access to Gold
was Silver. The coin investment demand in 2013 has nearly doubled
compared to 2012. This is set to grow further through locally minted coins
and small bars. Low premiums and making charges at nearly USD 0.10 per
10 gram coin became a strong driver for this business. Used primarily for
gifting and incentives, these coins have found favour in the investment
market also in wake of severe restrictions on availability of gold.
Jewellery
A 28% increase compared to 2012 in Jewellery consumption (932 tonnes)
became close to the single largest percentage contributor to the overall
increase in Silver Jewellery consumption in the world. Due to low cost of
operations in India, the manufacturers turned to exporting more silver
jewellery and created an increased consumption of the metal in the Indian
market. The higher margins due to low cost of operations and an
uninterrupted supply were an additional incentive.
Industrial Usage
A minor drop in Industrial usage across the world encompassed India in its
wake which predominantly reinforces the view that the increase in
consumption of Silver in India was more to do with private investors who
brought Silver bars as an investment option due to non-availability of
Gold.
Silver Articles
The drop in the price of Silver and the constrained availability of Gold
prompted a rise in consumption of Silver articles and artefacts in 2013.
India became the single largest contributor in this category across the
World. With Silver being freely available, the manufacturers who had a
shortage of gold focused on silver articles such a Ganesha, Buddha
statues, gift items and cutlery at very competitive prices which saw an
increased consumption across the country at lower price points.
Increasing consumption
Low cost of labour and skilled artisans are a valid support for the Indian
Silver exports and we assume exports can be increased if the local
manufacturers are willing to orient themselves more towards the western
world, their motives and traditions. Tailor made products for each specific
market. India is a land of temples. If the temple trusts and devaswom
boards that govern these temples would be willing to enter into and give
accreditation to new projects which are containing a better quality product
for their devotee and faithful and raise reputation and image of their
temples, that could certainly boost the domestic demand. Also with a
community and social leaders having a huge following, the desire to own
mementos and limited edition or commemorative coins in Silver is there.
Silver certificates is a market yet to be tapped and such a market will
allow investors to buy and sell silver without the inconvenience associated
with physically transferring silver. India remains a price sensitive market
but the appetite for Silver will remain strong and innovative and quality
products will drive the business.
Valcambis Initiative to Design Tailored-made coins for Indian
Customers

59

It is one of the most fascinating moments in the year when discussions

with our Indian customers start on how their new coins should look like.
Commemorative or deity coin - what design should it be, what size,
composition of the colours and what about the finish of the rim? While
discussions carry on, the important mission starts: squeeze the
manufacturing cost of a high quality product into the (price) expectations
of the Indian customer. Silver coins have had a long tradition in India
which can be partially explained by silvers solid value performance. Silver
off take in India can still be considered as in line with global demand. It
attracts significant attention because of its particular importance in the
global market. Silver remains attractive to both investors and physical
holders as the long-term outlook is promising. The favourable ratio to gold
(currently at 65, 50, above 60 usually considered high) contributes to
silvers attractiveness as well as the technical long-term support at USD
19 oz. Back to the fabrication of the coins; while working on the before
mentioned pricing for the tailor made silver coins with colored designs,
discussions with the customers based on his draft take place. Long-term
experience in the manufacturing and colouring of such coins and
implementation of the designs are key elements in this process. This is
both helpful on assisting the customers with ongoing orders as well as
providing ideas to those customers considering first time orders. The sizes
of the pieces range from 1 gram to 100 grams, round or rectangular. The
presentation of the finished coins by the designer is always a special
moment. Does it meet and represent the expectations of both the
customers as well as ours? At the same time, the proposals for the tailor
made packing which can be in capsules or blisters are available to finalize
the project. A final meeting of the project group with the feedback of the
customer approves the project for production. Apart from tailor made
coins, bars are very popular, not only in India but also globally. Demand in
India still focuses on coins but bars in the size of e.g. 1 kg are gaining
more attention because of their small production surcharge.
Silvers good life in the shadow of gold
Silver is popular because of being an interesting and affordable precious
metal the industry and investors both like equally. It is an interesting met
alto work with and can be converted into various products such as coins
bars and is used for many industrial products Silvers precious values like
its excellent electrical and thermal conductivity are widely known. Its
potential for the applications of photovoltaic or increased appropriateness
for medical purposes are providing new demand and may be basis for a
potential significant increase of silver consumption. All this new
applications create discussions and reflect the growing interest in silver.
However, the focus remains still on the impact of the global economic
development, but it looks like there is a growing community that considers
such thoughts as important. The underlying fundamental solid demand is
not only provided by the industrial use but also by the jewellery sector.
Further Silver is valued as an alternative physical investment, not only in
India but also in other parts of the world, which is also reflected in the
interest of small bars up to 1 kilogram. Looking at the supply side, it will
be also interesting to see how mine production and scrap supply will

60

develop over the next years. As the outlook for silver looks promising,
along with manifold industrial usage and applications, new ideas for
attractive silver settings in jewellery and innovative designs for silver
coins will be the visible value of silver and will also contribute to a shiny
future.
Global markets perceive silver more as an industrial metal than a precious
metal. Yes, silver does have an investment demand side to it. However,
the dominant facet of silver, globally, has been the industrial demand.
India is perhaps the only global marketplace where silver shines both a
precious metal and an industrial metal. The breadth and depth of silver
jewellery industry and the silverware manufacturing in India is simply
mind blowing. Not to be left out, there are growing clusters that cater to
silver industrial demand side too. Thus, India offers an array of
manufacturing activity using silver as primary raw material for a wide
range of applications. However, as with everything connected with silver,
these are hardly highlighted, under-researched and under-marketed.
Silver for Livelihood
In the current study, we tried to understand how silver market had grown
post-independence (in the year 1947) in various parts of India. The
journey was never smooth. The transition from a country that was under a
foreign rule for 200 years to a free nation was chaotic in the beginning in
economic, political and social landscape. The challenge for the country
was to create opportunities to its citizen to survive. India was an agrarian
nation (still it is) and often weather calamities hit. Country had to depend
a lot for essential commodities supplies from foreign destinations to serve
its citizen. Industries were there in some pockets. Banking system was not
developed and people had little option to save their hard-earned money
but in two assets land and precious metals. This saving in precious
metals played a crucial part in free Indias early economic history and in
this study we have chosen silver market to understand its contribution to
economy at a time when economic opportunities were minimal, citizen
were not educated and poverty was supreme. This study is a tribute to
those millions of artisans who not only chose the profession of jewellery
making for their An Empirical Study of Silver Markets in India survival, but
engraved in metal the tradition of Indian culture and art. It is a
misconception by many today that gold and silver were adorned in this
country only for fascination of its glittering qualities. Economy is always a
mechanism of demand and supply and if demand came from that
fascination, supply was delivered by millions of poor artisans who chose
the profession not by choice but for need. By making jewellery, they
earned their two meals.
Inter-alignment of Silver Market
Silver was inexpensive compared to gold and perhaps for this, it remained
under-researched and under-marketed. But in economic perspective, its
contribution is immense. Gold and silver were permitted to be imported
during British era and in 1942 when World War II broke out, poor citizen of
this country gathered huge silver for future protection as they could not
afford to buy gold, but understood, the metal would provide economic

61

security in line with gold. This understanding paved the way for utilizing
the metal for livelihood in future days post-independence. People came all
across from villages and small cities to major Indian cities to utilize the
acquired white metal into economy. Over a period of time, almost all
major cities grew up as major manufacturing clusters with a string
attached every market became connected with other for individual
uniqueness, be it for design, craftsmanship and so on. This inter-alignment
of clusters developed a vibrant and dynamic silver market over a period of
time.
Silver as Saviour
When gold and silver import was banned under Gold Control Act in 1962
owing to large drain of forex reserve in 1962, it was silver which saved the
large karigar community across the country. Gold was not allowed to be
held beyond 1 kg by karigars and for that license was required, the
karigar community was badly hit as they had no job in hand to maintain
their livelihood. It was then large stockpiles of silver in the country which
survived these karigars. They utilized their knowledge of gold jewellery
making in silver jewellery and silver articles, which always had demand in
the country, saved their lives. This story of survival of common men
engaged in jewellery making was never acknowledged or highlighted in
this country as focus of the media centred on large illegal trade in gold
bullion erupted post-introduction of Gold Control Act. We tried to
understand the contribution of silver to economy as the metal brought
foreign currency back home through export of silver bullion when silver
export was allowed by government. Few Indian refiners produced highest
quality silver bullion through indigenously developed technique and sold
to renowned bullion dealers overseas. It is to be noted that while UK or
Switzerland governments supported the precious metals refiners, Indian
government never supported the local refiners. No policy was formulated
to encourage large scale refinery in silver, who (refiners) otherwise was
sourcing the metal from domestic market. If it was done, we could have
had a strong precious metals refinery (exclusively silver) industry today.
Craftsmanship Redefined
Silver was never confined to only jewellery making in this country. The
renowned zari thread is a unique exhibition of Indian craftsmanship.
Coating precious metals over silk core to manufacture zari thread (a
thread which is thinner than human hair) is never an easy art and it had
been practised since the era of Mughals. Point here is to understand that
Indian karigars always wanted to generate value in silver in their
indigenous ways. While western world used silver more on industrial
applications like electrical and electronics, photography etc exploiting its
superior electrical and thermal conductivity, Indian used silver more to
generate aesthetic value, either in form of making idols, silverware,
jewellery or zari thread. Of course, in modern era, silver is used in
electrical and electronic applications, in this country too.
New Applications of Silver in Current Era
Indias economic growth in last twenty years has created scope for use of
silver in industrial applications, which otherwise was largely missing in
pre-liberalization era. India is still lagging behind countries like China, or

62

South Korea, or Thailand in electronic manufacturing. The scope of the

industry to grow is enormous as India is itself a large market. If this sector
grows, the usage of silver will certainly increase manifold. It is very
difficult to Tableure out the exact size of electronic industry in India as
business is concentrated in large unorganized sectors. The current study
does not cover application of silver in the segment. But, we certainly
understand that there is a big scope to study this segment in future.
Way Forward

63

Jewellery (including silverware) and investment are the largest demand

centres for silver in India at present. In 2013, jewellery and silverware
market had grown by 25% compared to 2012. This new demand has come
from young professionals who prefer light-weight inexpensive jewellery for
day to day use, exports and demand from tourists. According to GJEPC,
India exported around $1430 million worth of silver jewellery in 2013-14
compared to $804 million in 2012-13, a net increase of 77%. It is not
possible to maintain this growth year over year, but certainly this is one
segment which is
likely to grow in
coming years.
Customers have
become highly
conscious of
quality and prefer
92.5 fineness silver
jewellery
nowadays. This
trend is likely to
improve the
efficiency of the
market. Investment
demand is a
turnaround story in
2013 as investors
bought silver as an
alternative to gold.
Supply of yellow
metal is not
adequate in the
market after
Government of
India put import
restrictions in gold
under 80:20 rule.
We feel the
demand of silver
for investment will
continue, as long
as the restriction
remains. In first
three months of
2014, India imported around 1100 tons of silver compared to 392 tons
during same period a year earlier. GOI is still continuing with 80:20 rule
and according to current estimate, India will be short of 200 to 250 tons of
gold this year. So, we expect investment demand will continue to remain
strong in 2014.

64

Birth of Mumbai Market

As Mumbai had emerged as the financial hub of the country as early as
beginning of 19th century, post-independence it continued its position as
the largest trading centre of any sort. The city started with cotton trade,
and flourished over the decades. Post-independence, it emerged as the
largest trading centre for precious metals as well. In pre-independence
time, Mumbai was the only port where silver was imported. The metal was
then transported to centers like Ahmedabad, Delhi etc. Traders came in
this market in large way and readily identified that for making the
business conveniently they should have a pricing system. The Bombay
Bullion Association (BBA) was formed in 1948 out of the need of
addressing mounting issues arising out to bullion trade on day-to-day
basis. The wise businessmen of the time realized that they needed a
platform not only to promote or regulate bullion market, but also to settle
disputes arising between dealers, initiating proper weighing system,
assaying facilities etc. to make the trade highly competitive. The
association did an excellent job since its inception and within 10 years
time, Mumbai became benchmark market to influence business in other
parts of country. Bombay Bullion Association Ltd. was the official source of
RBI for quoting monthly rates of gold and silver and visible month end
stocks. Price of silver was initially quoted in Rs. /100 tolas basis till
September 30, 1960. From October 1, 1960 prices were changed to 1
kilogram basis. During that time, Bombay Bullion Association used to give
estimated end of month visible stocks details along with low, high and
average price of per kilogram of silver. In October 1960, when they moved
to kilogram system, according to BBA and RBI record, around 16 tons of
silver was available in Mumbai market. The stocks gradually started rising
and in February 1962, monthly ending stocks rose as high as 60 tons.
However, by the end of 1962, monthly stocks position came down to
around 30 tons. Gold, in same time period was initially 479 kilograms
which ended with 233 kilograms by the end of the year.(RBI Monthly
Review) It is important to note that in 1962, Morarji Desai, the then
Finance Minister of India, introduced Gold Control Act. Under this Act,
banks were stopped from providing gold loan and were instructed to recall
all existing loans. Forward trading was banned. Perhaps, for this, we had
seen highest outgo of gold and silver in a single year till date. As forward
trading was banned and subsequently Government of India banned
holding of gold and silver in bar form, RBI might have stopped publishing
monthly ending stock data, earlier supplied by Bombay Bullion Association
Ltd., in its Monthly Bulletin Review.
Delhi
Delhi remained the largest market during pre-independence era. Postindependence, it retained its position. In early days, Delhi used to follow
the Mumbai market. Price fluctuation in Mumbai market was followed
closely in Delhi. Delhi used to supply silver to all destinations in northern
India and so, as it happened in case of Mumbai, large migrations took
place in Delhi as well. But manufacturing never took off in the main city. It
emerged as traders paradise and it is still holding this status in silver
trade. Till 1990, trade practice was no different in Delhi as it was in other

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major hubs like Mumbai or Ahmedabad. Traders basically were dependent

on scrap supply and the metal which used to come to the market through
unofficial channel. Silver was inexpensive and it hardly attracted urban
population except silver utensils which was a stamp of aristocracy for rich.
Some silver jewelleries did come regularly from places like Salem, or
Rajkot. Local manufacturers were also involved in some silver jewellery
making activity in and around the city and places like Kanpur, Agra etc. In
1970s, when government lifted the ban on silver exports, (as we already
indicated), some refineries came alive who started making silver bar of .
999 purity for sake of export. However, published by The Bombay Bullion
Association titled The Case for Importing Gold in 1978, it was mentioned
that in the month of September, 1977, some official exports of silver took
place when the New York price was U.S. Centa 454 per ounce. But more
recently, even when the New York price was ruling around U.S. centrs 480
per ounce, no Export Associates of S.T.C is in a position to make any offers
for export. Why is this so? It is not because domestic industrial users of
silver are ready to pay a higher price, or that the flow of silver to the
export centres has dried up. The fact is that both the domestic users and
the exporters are priced out by the Smugglers who do not mind making a
loss on the silver export transaction, as the profit margin on their gold
import business has increased substantially by the soaring price of gold in
India. Nevertheless, a good amount of silver still was exported till 1980s
through official channel and Delhi played a major role in it. Silver price hit
record high in 1980s in London due to alleged manipulation by Hunt
brothers for which they were convicted later. Indian exporters used the
opportunity by supplying silver to West during that time. There used to be
a local OTC market that started in mid of 1980s, in Delhi. The market was
called Silver Byada Bazaar. Large traders and brokers used to manage the
market. In practice, there were two sessions, late morning and afternoon.
Price of silver was fixed based on local demand and supply. This price fix
was then circulated to almost all over India. But this practice had
operational loopholes; often, emerged the problem of settlement issues
between two parties. The mechanism of OTC trade was not standardized
and not regulated by any regulatory authority. Over a period of time,
traders started losing confidence in the system and looked for alternative.
The system continued till the time when MCX was launched in November
2003. Traders shifted to exchange generated rate as benchmark rate for
trade. Traders understood the alignment of MCX silver rate with that of
London, thus, local OTC market lost its relevance. As Delhi was the centre
for business in North India, it used to hold a lot of trade shows in those
days. Companies from Italy involved in manufacturing machines for
jewellery visited those shows to market their products in Indian market.
Jewellers from Agra got attracted to these machines. Hence, they installed
a few machines in the city. Agras machine-made silver jewellery took
birth through this process. Machine-made gold jewellery is still finding
difficulty to attract customers in India, but Agra machine-made silver
jewellery attracted people at the very onset. Machines, through higher
throughput and consistency, reduced cost of making jewellery
substantially. Silver was basically poor mans luxury, and thus,

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inexpensive yet attractive machine- made payal became popular in the

market. Later, Agra traders manufactured those Italian machines
indigenously at one tenth costs with close to similar performance. Delhi
imports around 20-25% of countrys total import of silver. The majority of
this silver, say around 70% (some years even more) gets distributed to
main manufacturing hubs in the region, Agra and Jaipur and of course to
destinations like Kanpur and Lucknow. In small quantity, other north Indian
states like Haryana, Punjab, Jammu and Kashmir get metal from Delhi. So,
Delhi/NCR retains around 20-25% of the metal locally. Retail investment is
the main consumption point along with manufacturing demand on low
scale. Delhi is a highly price sensitive market and there are traders who
cash-in even the slightest price volatility on day-to-day basis. Chart shows
monthly return on silver along with monthly volatility. In 48 months period
between 2010 and 2013, maximum single positive monthly return is
pegged at 24% in April 11 and 27% in Aug13, while maximum loss in a
single month is observed at 17%. Maximum single month volatility during
48 months period remains at 32% recorded in Mar13, while minimum
remained below 2.3%. So, the fluctuation is extremely wild and therefore
there is high degree of risk in short term trading. Demand had increased
manifold only in last year, might be because of 80:20 rule that thwarted
import of gold of required quantity in the region. Out of 718 tons that
Delhi retained in 2013, nearly 90% were consumed for investment
purpose. This was a huge shift or to say, stock in of silver while gold was
not easily available. Noida SEZ has emerged as one of the manufacturing
and exporting centres for silver jewellery in recent years. Manufacturers
within this SEZ import silver at 0% duty. Currently, according to trade
estimate, around average 50 to 60 tons of silver are consumed in the SEZ
per year.

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