How do you see the jewellery market is growing in India? Apart from jewellery which metal is ruling the precious jewellery segment?
The gems and jewellery sector in India is vibrant with GDP growth and is already playing a very significant role in the economy contributing to around 6-7% of the country’s GDP. Consumption is linked to GDP growth and there has been a continuous growth in consumption. In India, gold is the largest market, consisting of around 85% of the market, but over the last decade we have seen a very healthy growth in diamond. However, the fastest growth has been in the platinum segment with a CAGR of over 30%.
In a market largely dominated by unorganized players, over the last decade we have seen a convergence of the organized sector. While organized players were always at a disadvantage with GST and recent regulations we believe that the tax arbitrage will reduce.
Kindly shed light on current distribution of the brand Orra including India and international? Also, how you plan to enhance the distribution?
ORRA is a national brand with design innovation at par with trends in the international circuit. We have a pan India presence in 21 cities of India across metro and Tier 1 and Tier 2 cities, combined with a strong online presence. While on one spectrum we have reached out to the international markets, on the other spectrum we have also managed to capture consumer attention in Tier 3 cities as well.
ORRA has grown largely through its own stores (standalone and not shop in shop format stores) and is looking to expand across India through its own as well as franchise stores.
Do you think that organised markets have started making in-roads in luxurious products market in place of the traditional jewellery shops in India? Do you think there is transparency needed in terms of pricing for high-end products like diamond jewellery? What has changed in terms of pricing post GST?
India’s growth in organized markets is as what is seen in other countries as well. Currently, the Indian jewellery market has been fragmented and, traditionally the consumer would still prefer to go back to their family jeweller. We also see a mobility of work force. People no longer study in cities that they are born in or work in cities that they have studied in. We also see the emergence of the nuclear family. The traditional barriers of entry are breaking down. In addition, it is no longer merely about the product but the approach is more holistic. E.g. Design inspiration, quality of craftsmanship, ethical standards etc. also play a role.
In India, we have been selling jewellery more like a commodity and therefore the break-up in gold and diamond jewellery pricing. However, at ORRA we don’t treat jewellery as a commodity and sell on a fixed price basis.
According to you what are the major challenges as far as high end jewellery retailing is concerned?
High end jewellery is a more personalized and more customized business. The one-on-one rapport with the client is not only necessary but essential. From a product offering point of view, it is not only the ability to showcase a larger range, with a focus on design but also the ability to be able to source the finest quality of diamonds and coloured stones. The higher value jewellery also includes the bridal segment which in the recent years has seen a robust growth. However, with the rise of destination weddings, the challenge of custom regulations and travelling with high value goods runs risk of facing competition with imitation jewellery.
Shed light on your best selling collection from Orra? Also, how you are strategizing to enhance the product range? How the brand is betting on men’s category?
The ORRA Platinum Couples of matching couple bands is one of our best sellers. Year on year, we have seen many couples who are either about to get engaged or celebrating their love once again come to us for this stunning collection. Each band signifies the purity of the relationship and the solitaire atop stands for 'The eternal love' that is superior to everything else. These exquisitely crafted rings are embellished with certified Belgian diamonds are available in exclusive collections themed on Duets, Love Code, Bar Code, Love Bands and Infinity.
In addition to this, the pursuit of innovation made us create the ORRA Crown Star diamond, a patented design with 73 facets vs. the regular 57 faceted diamond which is also one of our best sellers. These facets are aligned in perfect proportion to provide maximum brilliance. The accuracy with which the diamond is cut gives it an unmatched brilliance.
At ORRA we also focus on curating different occasions and different themed based jewellery. In all, we launch six collections every year. This allows us to keep the freshness in designs which our customers look forward to as well. During the festival season, we ensure that we keep an additional stock on our best sellers as well as use this time to present our new collections based on latest trends.
While earlier it was little heard of men purchasing jewellery for themselves, we now see a number of men sporting jewellery especially in platinum. Our strategy has been to maximize our offering for men including bracelets, bands, chains and rings. We expect the requirement to only grow over time.
Who do you see as your potential competition in the same space?
ORRA is competing in the core of the jewellery market and therefore sees competition both from local as well as national players. However, one big difference is that while most have built their positioning and consumer strategy on gold (which accounts for 70-80% of their business), ORRA is a diamond centric brand.
Pls throw light on your store profile including size, design, number of SKUs placed ? Mall vs highstreet where the brand will be expanded?
Our stores have been designed in order to add the luxury quotient to the brand. These are on an average 1200 to 1400 sq. ft. in size. With visuals, façade, décor and an ambience that connotes luxury and contemporariness, the lighting and seating ensures the warmth that is essential to the Indian jewellery segment. This has helped in building a popular and distinct brand image over time. On an average we have around 400 SKUs.
Mall stores are allowing us to expand our consumer base in comparison to high street stores. Customers can leisurely browse through the collections as well as place orders for custom made pieces. Operational costs are also taken care of.
Kindly shed light on tier 2 market, what kind of response the brand is garnering from smaller towns?
In smaller cities aspirations are high due to increased connectivity. People are connected through social media and better connectivity can be seen through the recent surge of 4G connectivity across India leading to over 80% of mobile having access to these networks.
Availability is low and awareness is high. The cost of operations is relatively much lower.
Has the brand opted franchise route for further expansion? If yes, kindly share details?
The franchise model has its own advantage. It helps the brand cut down on its operational costs as well as create a better distribution network. As with any initiative, ORRA builds expertise ahead of plans. Over the last two years, we have mapped not only the cities that we would like to see ourselves in but also possible locations. Each location has already been visited at least a couple of times. A team has been built with very strong franchisee experience including with some of the global majors. We are positive that through this model as we will continue to see a growth.
Pls mention your starting and exiting price point with average bill size?
Our product range begins at Rs. 5000/- and exiting price is up to 25 lacs. We however, do also have many custom made single pieces that are worth 50 to 60 lacs. The average bill size at ORRA is Rs. 50,000/- plus.
Do you think jewellery (expansive) as the category has the potential for online retailing? Kindly shed light on your online business?
While brands have always made an attempt to discriminate between the online and offline models, in the mind of the consumer, it is not different but rather the cumulative experience of one brand only. The digital space acts as an enabler for the discovery phase of products. With the information available, there is no sales assistance required by the consumer. So today, you would have many consumers walking into stores already knowing beforehand what they want to see for themselves. When it comes to jewellery, we have seen a trend where consumers view the products online and make their purchase at the store level. Brands don’t mind this sort of an enabler with regards to the actual point of purchase. This shows the indispensible need for both an online as well as an offline presence.
There is also vast potential for the jewellery category which has been seen to be true through the examples of international ecommerce players such as Amazon as well as local players such as Flipkart, Snapdeal and TataCliq amongst others hosting a special jewellery retail segment.
At last, pls mention brand’s growth plans?
We believe in building a strong customer patronage and while we endeavor to grow our customer base, we are also focusing on retaining customers through higher customer engagement, effective content marketing and in-depth consumer purchase trends and analysis. This year we have renewed our focus on digital and CRM. We also plan to expand by 8-10 stores every year.