CHAPTER 1

INTRODUCTION OF THE RESEARCH TOPIC, CONCEPTUAL

BACKGROUND, AND INDUSTRY PROFLIE

1.1 INTRODUCTION OF THE RESEARCH TOPIC

1.1.1 Introduction of Gems and Jewellery Industry

Gems and Jewellery industry plays a pivotal role in the economy of India constituting
almost 5-6% of overall GDP. It was always valued as a mode of saving and investment
vehicle. The industry is also well supported by government policies and the banking
sector.

As per CMIE (Center for Monitoring Indian Economy) report India imports around 8%
of Gold of its total import. As per International Financial Statistics of March 2017 India
is ranking 11th in the world in terms of gold reserves in the bank (557 tonnes). On the
domestic front, India is one of the major consumers of gold cornering around 30% of
world’s total gold consumption and which is expected to have nearly 12-15% (16,00
tonnes) the world’s cumulative gold stocks. But as per the World Gold Council report
Jewellery demand worldwide is declined by 15% in 2016 as compared to 2015.

India is the world’s biggest diamond cutting and polishing center with 80% share in
the world market. Though demand for diamond jewellery in India is quite low as
compared to overall jewellery demand, the same is picking with rising urbanization,
younger population, rising popularity of diamond due to marketing efforts by the gems
and jewellery players. Currently, the diamond industry is growing at a tremendous rate
on the back of growing demand and increasing consumer preference. Modern and
trendy Silver jewellery is in demand as compared to traditional jewellery.

Silver jewellery is expected to grow by 300% in coming 5 years. GJEPC reported fastest
growth in silver jewellery exports because of its demand in international market. As per
WPIC India’s demand for platinum jewellery is rising and it increased by 11.5% in
2016.

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The jewellery market is one of the largest consumer sectors in the country. The
purchasing power and disposable incomes of the Indian consumer have considerably
increased and it has created a niche for leading branded jewellery in the last decade,
resulting in phenomenal growth in this sector. Nowadays consumers are more quality
conscious than ever before. And Jewellery retailing is moving from a ‘Storehouse of
value’ to a ‘Precious fashion accessory’.

1.1.2 Introduction of the Marketing Strategy

Marketing is the backbone of any organization and to run any business the organization
must have to design strong marketing strategies. The revenue for the organization is
directly generated by sales supported by various marketing practices. Organizations
have to design marketing strategies which make aware to the customer about products,
leads them to purchase it and keep them satisfied by offering the services.

Gems and Jewellery business is too old its nature is changing since decades. Consumer
behaviour is also changing as per the age, gender, occupation and income. It becomes
challenge to the retailers to frame strategy in this changing era because of micro and
macro environmental factors affecting on the industry. Marketing strategies always
helps retailers to boost their business. Marketing strategies starts with environmental
analysis and then leads to STP, 7 Ps, CRM, Service quality and ends with profit making
with customer satisfaction.

In the present study the researcher would like to study and analyze Gems and Jewellery
retailers marketing strategies. The aim of the research is to develop framework of some
new marketing strategies and to give the inputs to Gems and Jewellery retailers which
will lead to a new model, which can be applied in retail outlets to improve profitability
and relationship with customers.

1.1.3 Need of the Research

 Changing lifestyle of customers and passion for the ornaments created desire in
the mind of researcher to study the topic in depth which will help to frame new
marketing strategies for the Gems and Jewellery retailers.
 Changing Govt. policies and challenges in front of Gems and Jewellery retailers
need to be understood.

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  The development of IT industries, educational institutions, development of
infrastructure, & tourism in Pune has created a growing potential for Gems &
Jewellery Retailers in Pune city. Therefore there is a need to exploit this business
potential of Gems & Jewellery business in Pune.
 A focused investigation on marketing strategies followed by Gems and Jewellery
retailers is needed. This study will help Gems and Jewellery retailers to develop
precise marketing strategies for consumers and to maintain good relationship with
them.

1.1.4 Scope of the Study

 The study analyses various marketing strategies followed by Gems and
jewellery retailers and its influence on brand equity, consumers purchase
decision and revenue generation.
 The researcher has limited the study to Pune city.
 This study has been undertaken from the point of view of Organized Gems and
Jewellery retailers, Unorganized Gems and Jewellery retailers and Customers.
 Major Factors studied in this research are Marketing strategies, Marketing mix
elements, Brand equity, Customer Relationship management, Consumer
buying behaviour, Service quality etc.

1.1.5 Significance of the study

Significance to Industry
 The results of this study will help Gems and Jewellery retailers in
understanding consumer buying behaviour, consumers purchase pattern,
brand equity and the gap between actual and expected levels in service
quality.
 This study will be helpful to Gems and Jewellery retailers in designing new
marketing strategies which will be beneficial for the revenue generation and
growth of their business.
 This study will help the organized and unorganized retailers to study each
other’s market status and to know comparative statistics amongst
themselves.

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Significance to Customers
 This study will help customers to know the marketing strategies used by
organized as well as unorganized Gems and Jewellery retailers in Pune city
which will be helpful in their buying decision.

Contribution to Academics
 This study will be helpful to academicians to develop new marketing strategy
models for retail industry.
 The results of this study will help the academicians and students to carry out
new research.

1.1.6 Limitations of the Study

 The study doesn’t deal with technical aspects of jewellery like mining,
fabrication and processing.
 This study encompasses only jewellery segment (which also includes jewellery
studded with gems) of the Gems and Jewellery industry & does not consider
gemstones & pearls segment in detail.
 The researcher has limited the study to Gems and Jewellery retailers in Pune city.

1.1.7 Chapter Scheme

The researcher has used following chapter scheme for his research study;
Chapter 1
 In this chapter the researcher has explained the introduction of the research
topic, objectives of the study, scope of the study, need of the research,
significance of the study, conceptual background of the research study and
industry profile of Gems and Jewellery sector.

Chapter 2
 In this chapter the researcher has explained what he has studied in the literature
review related to the research topic. This literature review is based on the
research papers, articles, reports and Ph.D thesis related to the research topic.
The researcher has also done analysis of literature review and explained the
research gap identified.

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Chapter 3
 In this chapter the researcher has explained the Research Design which he has
applied in the research study. This research design includes type of research
design, sampling design, data collection methods, data analysis methods and
tools for hypothesis testing.
Chapter 4
 In this chapter the researcher has explained data analysis, data interpretation and
hypothesis testing using various statistical tools and techniques.
Chapter 5
 In this chapter the researcher has given detailed information about the findings,
recommendations, limitations, future scope of the study, contribution to the
industry and conclusion.

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 1.2 CONCEPTUAL BACKGROUND

In the research study, the researcher has studied various concepts and correlated these
concepts with Gems and Jewellery industry. These concepts includes marketing
strategy, marketing mix, consumer behaviour, brand equity customer relationship
management, service quality, corporate social responsibility, celebrity endorsement,
environmental analysis etc.

Figure No. 1.2.1 Definitions of the major concepts related to the topic

Consumer Behaviour:-
Marketing Strategies:- Consumer behaviour is a process in
The science and art of exploring which individuals or groups select,
creating, and delivering value to satisfy purchase, use or dispose products,
the need of a target market at a profit . secrvices, ideas or experiences to
-Dr Philip kotler satisfy needs and wants.
-Solomon

Customer Relation Management:- Service Quality:-

CRM is the core business strategy that Service quality is the subjective
combines internal processes, functions comparison that consumers make
and external network to create and between the quality of service that they
deliver value to targeted customers at a want to receive and what they actully
profit. get.
-Buttle, F -Gefan.

Brand Equity:- Gem:-

The set of associations and behaviour A cut and polished gemstone or a pearl,
on the part of a brands customers, used for ornamentation.
channel member and parent corporation Jewellery:-
that permits the brand to earn greater Ornaments that people wear, and they
volume than it could without the brand often made of gems and precious
name. metals.
-Leuthesser

(Source: Generated by researcher using secondary data)

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1.2.1 Marketing Strategy
Marketing strategy determines the choice of target market segment, positioning,
marketing mix, customer relationship management, service quality etc. Various
marketing strategies enable a firm to expand business activities for market reputation,
to satisfy human wants, to lead to specialization and efficient performance of
production function climaxing in profitability and economic stability.

Figure No 1.2.2 Marketing strategies of Gems and Jewellry retailers

(Source: Generated by researcher using secondary data)

In the present research study the researcher has studied the above mentioned marketing
strategies with special reference to Gems and Jewellery retailers in Pune city.

Figure No.1.2.3 Marketing strategies & revenue generation

(Source: Generated by researcher using secondary data)

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1.2.1.1 Environmental Analysis
Environmental analysis is the analysis of the internal and external environment of a
Company. It is the tool to identify the internal and external elements which affect the
performance of a business. An environmental analysis is done by the Company to
understand the strengths, weaknesses, opportunities and threats. Environmental
analysis consists of two main factors- micro environment and macro environment
factors. Micro environment factors are the internal factors which affect the business
and macro environment factors are the external factors by which the business strategies
are affected.

Figure No.1.2.4 Environmental Analysis

(Source: Generated by researcher using secondary data)

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered Micro Environmental factors like- Company policies, Customers,
Competitors, Suppliers and Macro Environmental factors like- Political, Economic,
Socio-cultural, Technological, Legal, Demographic factors and Government policies.

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1.2.1.2 Segmentation, Targeting & Positioning
Today’s most applied and common marketing model for most of the organizations is
STP (Segmentation, Targeting, and Positioning). Gems and Jewellery organizations
also follow this STP model.

Figure No. 1.2.5 Segmentation, Targeting & Positioning

(Source: www.studylecturenotes.com)

Segmentation
Market segmentation means dividing the total market into small sub units which
includes customers of similar tastes and preferences. It is the criteria of creating sub
groups of market within a large market and this sub division includes the like-minded
individuals. One market segment is different from other market segments. Market
segmentation is important as it reaches the consumers with their suitable needs and
wants. The Company resources can be used very effectively when segmenting the
markets. While studying the marketing strategies of Gems and Jewellery Retailers, the
researcher has considered customer segments like household consumers, professionals,
young generation, males, females, retired persons and high net worth individuals.

Targeting
When the market is divided into various segments, the next step is to evaluate these
segments and deciding how many and which one to target. Target market basically
involves two criteria’s-Evaluation and Selection. Market is segmented using certain
factors of the Company like age, gender, income, education, etc. Out of these, some of
the segments are evaluated and selected for further study. This evaluation and selection
is called market targeting. A target market involves the individuals of similar
characteristics which are to be served. Market targeting helps to develop effective
promotion strategies of a Company. It also helps to focus on the potential customers

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who are interested in purchasing the products. These customers are the end users of the
products.

Positioning
Positioning indicates a positive image of the brand in the minds of the customers.
Positioning is a marketing strategy which aims to create a distinct position in the minds
of the customers. It is all about customer perception. It is the process which determines
the communication of the product features to the target customers. It defines where the
product stands in comparison to the competitors in the market. Product is unique and
different if good positioning is done.

Figure No.1.2.6 Positioning Strategies

(Source: Generated by researcher using secondary data)

While studying the positioning strategies of Gems and Jewellery Retailers, the
researcher considered positioning by product attributes, price, quality, positioning with
respect to product class, competitors and service quality.

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1.2.1.3 Marketing Mix Strategies
Marketing Mix is the combination of the factors which helps the company to influence
the purchase decisions of the customers. Marketing mix is the set of tactics that the
company uses to increase the product awareness. Marketing mix is all about 4 Ps i.e.
Product, Price, Place and Promotion. In case of service related industries, 3 Ps are added
which are- People, Process and Physical Evidence. These components help to sell and
promote a product or service of the Company. Product is any tangible good or intangible
service which satisfies the needs of the customers. Price is the monetary value that the
customer is expected to pay for a product. Place identifies the availability and
accessibility of the products. Promotion includes various tools to promote a product
like advertising, sales promotion, direct marketing, personal selling and public
relations. People, process and physical evidence are used in case of services. While
studying the marketing strategies of Gems and Jewellery retailers, the researcher
studied all the 7 Ps.

Figure No. 1.2.7 7P’s of Marketing Mix

(Source: Generated by researcher using secondary data)

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Product-Related Marketing Strategies
Product is the first and most important P of marketing mix. Products are classified into
two major categories goods and services. Goods are tangible things while services are
intangible. Product constitutes of brand, packaging, labeling etc.
While analyzing the influence of the product-related marketing strategies the researcher
has taken into consideration three important product related strategies, namely, product
designs availability, purity of products and product exchange facility. The researcher
has also studied product guaranty and product packaging.

Price-Related Marketing Strategies

Price related marketing strategies plays a significant role in the growth of economy and
profit of an organization. This strategy is combined with all the marketing strategies.
Pricing strategy largely impacts on a profit of an organization, variation in prices
gradually impacts on sale and demand of an organization. In the jewellery market also
pricing strategy plays a crucial role.
Final price of the jewellery = Price of (22 KT or 18 KT) gold X (Weight in grams) +
Making charges + GST at 3% on {Price of jewellery + making charges (in the range
of 5-20%)}.

FigureNo.1.2.8 Price-Related Marketing Strategies

(Source: www.slideshare.com)

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While analyzing the influence of the price-related marketing strategies in Gems and
Jewellery market of Pune, the researcher has taken into consideration three important
price-related strategies, namely, Jewellery purchasing plans, discount vouchers and
price tag facilities.

Price impact on jewellery due to GST

GST (Goods and Services Tax) introduce on all sectors of the country by Govt. of India
had impact on price. In case of gems and Jewellery industry GST decided by Govt. is
3%. And GST on making charges is 18% which is later on reduced to 5 %.

Figure No.1.2.9 Price impact on jewellery due to GST

(Source: www.legalraasta.com)

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Jewellery Purchasing Plans

Figure No.1.2.10 Jewellery Purchasing Plans

(Source: Generated by researcher using secondary data)

Table No.1.2.1 Jewellery Purchasing Plans

Gems and Jewellery Retailers Jewellery Purchasing Plans

P N Gadgil & Sons Kuber Scheme

Ranka Jewelers Suvarna Poornima Plan

Kalyan Jewellers Purchase Advance Scheme
Gitanjali Jewels Tamanna Monthly Saving Scheme
Joyalukkas Jewellery Easy Gold Scheme

Goodwin Jewellers Pvt Ltd Swarna Nidhi, Gold Purchase, Gold Investment
Tbz Jewelers Kalpavruksha Plan
Pc Jewelers Jewels for Less
Tanishq The 11+1 Plan
D'damas The 18 Months Plan
Malabar Gold & Diamonds Products with Smart Buy + Customize option
Kothari Diamonds and Jewels Gold deposit scheme
P N Gadgil Jewellers Kuber Scheme

Waman Hari Pethe & Sons Shree Dhan Discount Yojana

(Source: Generated by researcher using secondary data)

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Place (Distribution) - Related Marketing strategies
Place plays a significant role in the distribution of any product in the market. Place in
marketing mix is the distribution channel which identifies the movement of goods from
the producer to the consumer. It defines the route of the goods to be available from the
source to the consumer. The availability and accessibility of the products is indicated
by place. Place is also an important factor for getting a product outlet. Place involves
all the intermediaries like wholesalers, retailers, distributors and dealers which help the
manufacturer to make the products available to the consumers at the right time. It also
considers transportation and storage of the products for making the products available
to the customers.

While analyzing the influence of the distribution strategies in Gems and Jewellery
market of Pune, the researcher has taken into consideration online distribution (through
own portals and through other companies portals) and offline distribution (exclusive
outlets and in malls).

Online Retailing
Designing an easy understandable website and providing secured payment would
encourage all kinds of customer to visit the e-store and buy the products. The business
of Gems and Jewellery industry is growing over the Internet more rapidly. It gives the
ultimate shopping experience to the customers to shop the jewellery products online.
These online jewellery stores sell a wide range of traditional and modern jewellery in
Gold, Diamond, Platinum, etc. The exclusive online Jewellery selling stores in India
are Carat lane, Bluestone, Kalyan Jewellers, GRT (G.R. Thangamaligai Jewellers),
Surat Diamonds, Prince Jewellery, Zaamor Diamonds, Farah Khan Fine Jewellery,
Jewel souk, Johareez, etc. At present the contribution of online jewellery retailing in
overall retailing is below 10%. It is expected in future that online jewellery retailing
will grow 70% annually.

In the research study, the researcher has focused on the use of online retailing through
own and other companies portals by Gems and Jewellery retailers. And also focused on
the frequency of customers purchasing jewellery products online and their level of
satisfaction.

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 Figure No. 1.2.11 Online Retailing

(Source: Generated by researcher using secondary data)

Promotional Strategies
Nowadays jewellers are using many promotional techniques to reach to its targeted
customer. For running successful business a businessman have to launch new
promotional strategies as per market situation. Promotional strategies become essential
in the gold ornament business to compete. All sectors in business world have to do
some promotional strategies to launch the product and sale it and Gems and Jewellery
sector is also not an exception for it.
The researcher has considered three important promotion related strategies, namely,
sales promotion, advertising direct marketing and public relations.

Figure No.1.2.12 Promotional Strategies of Gems & jewellery Retailers

(Source: Generated by researcher using secondary data)

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Advertising
Advertising is a promotional tool which communicates about the products and services
to the customers. The main aim of advertising is to create awareness, increase sales,
promote product/brand image, and neutralize competitor’s advertisement. Advertising
plays an important role as it is the only tool which makes customers aware about the
products and services.

Figure No.1.2.13 Advertising tools of Gems & Jewellery Retailers

(Source: Generated by researcher using secondary data)

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered advertisement on national T.V, local T.V, radio, internet, newspapers,
magazines, intercity billboards and posters, brochures and booklets, trade
fairs/exhibitions, advertisement in movies and word of mouth.

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Advertising through Movies
Now it is becoming trend to do product advertisement in movies. Sometimes products
are shown in the movies and sometimes it has tie-up or association with the movies.
Gems and jewellery retailers are also doing advertising through movies and sometimes
they launch product designs related to theme of the movie. P.N.Gadgil jewellers have
launched jewellery on the theme of the Bajirao Mastani movie and Tanishq also
launched product designs in association with Padmavati movie. Retailers also love to
advertise their outlets in the movie. This trend is also growing in regional movies.

Figure No.1.2.14 Advertising through movies

(Source: www.tanishq.co.in)

Sales Promotion
Sales Promotion is the promotional tool which includes the set of marketing activities
to increase the sales of the products or services. It helps to influence the customers to
purchase the product. It is a short term activity which is particularly designed to enhance
the sales of a company. The sales promotion activities are aimed at the intermediaries
like retailers, wholesalers and it is also aimed to the final consumers. These are called
as trade promotion and consumer promotion. It consists of the collection of incentive
tools which mostly influence the purchases of the products. As there is increase in the
level of competition, these tools are used to promote the product.

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 Figure No.1.2.15 Sales Promotion activities of Gems & Jewellery Retailers

(Source: Generated by researcher using secondary data)

Figure No.1.2.16 Sales promotion tools of Gems & Jewellery Retailers

(Source: Generated by researcher using secondary data)

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered sales promotional tools like contests, coupons, prizes and gifts.

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Direct Marketing
Direct Marketing is the effective way to share information about a product or service
through emails, telephone, brochures, coupons, etc. Direct marketing does not require
a middle man for the promotion process as it includes direct message to the final
customer. Direct marketing aims to persuade the customers to take action.

Figure No.1.2.17 Direct marketing tools of Gems & Jewellery Retailers

(Source: Generated by researcher using secondary data)

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered direct marketing through email, SMS, social media and telecalling.

Personal Selling
Personal Selling is the promotional tool where salespersons of the company sell the
products to the customers by meeting them directly. It is the face to face interaction
between salespeople and the customers. The salespeople match the benefits of the
products to the needs of the customers. The aim of personal selling is to inform the
customers about the products and influence them to buy the product. It is also called as
salesmanship. Personal selling has been an important promotional tool to promote the
product to the end consumer and also to increase the sales. Personal selling also helps
to identify the tastes and preferences of the customers interested in buying the product.
In personal selling, the sales people sale their products by doing face to face
communication i.e. by giving products for sample test as to use them and then buy.

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Sales person plays a vital role in the 7Ps of marketing mix. At store interaction and
communication is occurred between the sales person and the customer. More polite and
pleasant the communication is; better is the interaction with the customer which results
in appreciation of the services provided by the store and customer satisfaction.

Public Relations
Public relations are the best way to create good corporate image. Public relation means
to maintain a healthy relationship between the Company and customers, employees,
stakeholders, investors, etc. Public relations can be used to give positive messages to
the target customers.

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered the public relations practices like organizing seminars/ forums, giving
interviews to newspapers and mass media, taking part in charities and making
donations, publishing weekly or monthly newsletters about products, sending
catalogues and special price offers to potential buyers.

Figure No.1.2.18 Public Relations activities of Gems & Jewellery Retailers

(Source: Generated by researcher using secondary data)

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Gems and Jewellery retailers also sponsors events to maintain good relationship with
people.
Table No. 1.2.2 Events sponsored by Gems & Jewellery Retailers

Gems and Jewellery Retailers

Sponsored Events

P N Gadgil & Sons Sawai Gandharva 2016

Kalyan Jewellers Roadies Bottomwear

Reliance Jewels Mr and Mrs India 2017

Gitanjali Jewels Lakme Fashion Week

Waman Hari Pethe Jewellers Pyar Ka Bandhan

Nakshatra jewellery IIFA 2017

Painting Exhibition of Budding

P N Gadgil Jewellers
Artists
(Source: Generated by researcher using secondary data)

Celebrity Endorsement
Celebrity Endorsement means using some sports or entertainment celebrity for
promoting a product. The fame and social status of these celebrities help to promote the
products or services. The celebrities associated with the brands influence the purchase
decision of the customers. It creates a positive image about the product in the minds of
the customers. The use of Celebrities in Gems and Jewellery helps to identify the buying
behaviour of the customers. Celebrity endorsement also highlights whether the
customers are motivated to purchase the jewellery products due to its influence.

In the present research study the researcher has studied how many Gems and Jewellery
retailers are having brand ambassadors? How it is useful to them? How customers get
influenced by celebrities?

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 Figure No.1.2.19 Celebrity Endorsement

(Source: Generated by researcher using secondary data)

Table No. 1.2.3 Brand ambassadors of Gems & Jewellery organizations

Gems and Jewellery Retailers Brand Ambassadors

Ranka Jewellers Twinkle Khanna And Dimple Kapadia
Kalyan Jewellers Amitabh & Aishwarya Bachchan
Gitanjali Jewels Shraddha Kapoor
Joyalukkas Jewellery Hrithik Roshan
Tbz Jewelers Vaani Kapoor
PC Jewellers Akshay Kumar & Twinkle Khanna
Tanishq Deepika Padukone
D'damas Sonakshi Sinha
Malabar Gold & Diamonds Kareena Kapoor

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 KRA Jewellers Priya Bapat
CS Jewellers Genelia D'souza
Nakshatra jewellery Kangana Ranaut
P N Gadgil Jewellers Salman Khan,Madhuri Dixit
Gilli BipashaBasu
Asmi Priyanka Chopra
(Source: Generated by researcher using secondary data)

People
One of the most important element to meet customers need is an employee of the
organization. If employees of the company provide proper services to customers, the
customers will be satisfied and they will visit the retailer’s outlet frequently. Finally it
is the employee who creates the revenue for the organization by doing their duties as a
receptionist, as a salesman, as an accountant, as a helper etc. Keeping these things in
mind retailers is providing training to their employees about how to handle customers.

The researcher has considered this P while having interaction with the retailers as well
as customers. In the present study the employees training, incentives given to
employees and employees interaction with customers is also studied.

Process
It is very important for the retailer to provide their services to the customer in a
systematic and simple way. Process is all about the activities experienced by a customer
when he/she enters in the retail outlet till he/she goes out. All the 3Ps of service
marketing mix are interconnected with each other. The process would be better only
when it is surrounded by attractive physical evidence and communicated by well trained
employees.

Physical Evidence
Internal and external physical evidence enables the consumer to spend more in terms
of money and time at the store. Value added services provided to the customer would
help in retaining the customers. Making the core product available along with
augmented product to reach the customer expectation is very important. Marketing
techniques should be used for merchandizing which would result in word of mouth

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publicity. Music plays a psychological role in easing the mind of the customer and
resulting in positive mind status.

Figure No.1.2.20 Physical Evidence of Gems & Jewellery retail outlet

(Source: Generated by researcher using secondary data)

1.2.1.4 Service Quality

Service quality is important factor to know customer satisfaction. The various
dimensions of service like reliability, assurance, availability helps to identify customer
perception. To be competitive, a business needs to maintain high service quality to
achieve customer expectations. Service quality in Gems and Jewellery industry must
also include these dimensions.

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered right quality, availability of wider choice / selection of merchandise,
attractive physical aspects, reliability and transparency in service, customer care
service, price, credit/debit card facility, parking facility, trained service people,
convenient location, etc.

1.2.1.5 Customer Relationship Management (CRM)

Customer Relationship Management is the terminology that includes the strategies and
facilities used by the companies in maintaining healthy relationships with the
customers. Customer relationship management helps to identify the needs and
expectations of the customers and to provide them with the right product. It also leads

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to customer satisfaction and helps in retaining existing customers. Good CRM facilities
help to generate revenue for the business. It also strengthens individual relationship
with the customers.

In the jewellery business relationship marketing plays an important role in today’s

scenario. It covers a wide range of marketing techniques and process that aim at creating
and managing customers by giving them better service. A very important aspect of
relationship marketing strategy is customer satisfaction. In today’s competitive market
attracting and retaining customer assumes an important part of strategic management.
The strategy adopted by jewelers now days are giving special discounts on special
occasions, by offering gift vouchers , good customer service etc. Retailers are
maintaining good relationship with customers through direct communication, SMS, e-
mail, social media etc.

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered CRM facilities like Coupons, Membership cards, Festival offers, After sales
service and Gifts.

Figure No.1.2.21 CRM practices of Gems & Jewellery retailers

(Source: Generated by researcher using secondary data)

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1.2.1.6 Brand Equity
Brand equity is a term which highlights the value of a brand. It decides the worth of the
brand. It indicates the choice of the consumers related to the brand. This concept arises
when consumer makes the choice of a product or service. In brand equity the consumer
must be familiar with the brand and has a positive brand association with it. Brand
equity includes brand awareness, brand image, brand association and brand loyalty.

Figure No.1.2.22 Brand Equity

(Source: Generated by researcher using secondary data)

Brand Awareness
Brand Awareness indicates whether the consumers are familiar with the product and its
features. The recognition of the availability of the product or a service by the consumers
is brand awareness. It is important at the time of the product launch and it also
differentiates the product or service from the competitors. In the present study the
researcher has focused on how Gems and Jewellery retailers creates awareness about
their brands and services using various advertising tools.

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Brand Image
Brand image is the customer’s view about the brand. Brand image highlights the beliefs,
emotional value attached with the brand. It is the consumer’s perception about the
product. Brand image includes the elements like logo, tagline, name, color, sign,
symbol, etc. It indirectly indicates that the customer is not only buying the product but
also the image associated with the product. In the present study the researcher has
studied how public relation tools helps in creating brand image of Gems and Jewellery
retailers.

Brand Association
Brand association is a link which a customer forms in one’s mind about the brand.
Brand association is the features of the brand which the consumers recognize when the
brand is talked about. These are the images and signs and symbols associated with the
brands which are recognizable by the consumers. Brands or the benefits of the brands
are deeply associated in the consumers’ mind.

Brand Loyalty
Brand Loyalty is where the consumers make repeat purchases of the products of the
same brands. Here customer becomes committed to their preferred brands by not
considering price. These customers also get loyalty rewards and incentives. Brand
loyalty leads to more promotion as the loyal customers have positive image of the brand
and they promote it. While studying brand loyalty the researcher has focused on
frequency of customers changing Gems and Jewellery retailers brand which explains
the brand loyalty of customers.

1.2.1.7 E-Commerce, Digital Marketing & Gems and Jewellery

Business
The word e-commerce means facilitation of commercial transactions electronically
using advanced technology such as electronically data interchange, electronic fund
transfer the growth of credit cards, debit cards and automated teller machines has
increased rapidly at a large scale. In 2001 the emphasis of b2b shifted to b2c, e-
commerce, e-government-learning etc. In last few decades the growth of word
ecommerce has drastically increased and is increasing day by day. E-commerce also
supports to the mission digital India of our Honorable Prime Minister Shri Narendra

28
Modi. Due to digitalization the use of internet has increased in last few years and the
number of users using internet is also increased significantly. Jewellery purchasing is
becoming easier and faster. This will give boost to Gems and Jewellery sector.

Digital Marketing is the terminology of marketing where the digital channels are used
to market the products or services. It includes Internet and also other digital mediums
like mobile phones, social media, display advertising and also via television and radio
channels. The main objective of digital marketing is to promote the products through
these digital platforms. Digital marketing business has changed the business models to
capture the whole targeted customers. This also provides better competition and growth
to every business. Digital marketing in Gems and Jewellery business helps the retailers
to reach the market by promoting on the digital channels about the jewellery products
and services.

1.2.1.8 CSR Activities

Corporate Social Responsibility is about the management of the business processes by
the companies which highlights the positive impact on the society. It is a business
approach where economic, social, ethical and environmental benefits of all the
stakeholders are contributed. CSR is broad term which covers various topics like health
and safety, human rights, working conditions, corporate governance, etc.
Environmental and social wellbeing of the society are the initiatives taken by the
company for taking the responsibility. These activities have become very important
practices in any business to enhance their corporate image. CSR activities also give
competitive advantage. In terms of Gems and Jewellery, the commitment to the
stakeholders can be shown and providing them opportunities to get benefited from the
jewellery enterprise.

Social responsibility program is a form of corporate self-regulation integrated into a

business model. Nowadays jewellery retailers spend a lot of amount in these activities.
The main aspect behind this social responsibility programs is to target potential
customers. This concept also helps in boosting brand image, brand equity and brand
awareness of the company.

29
 Table No.1.2.4 CSR activities of Gems and Jewellery retailers
Gems and Jewellery
Retailers CSR activities
Felicitation of women efforts, First Roaming
P N Gadgil& Sons
School
Ranka Jewelers Eradication of extreme hunger and poverty
Kalyan Jewellers Pledges Rs. 20 crore for Housing For All
Reliance Jewels We Care-Celebrate the joy of new born
Joyalukkas Foundation- the Blood Donors
Joyalukkas Jewellery
Forum,
Goodwin Jewellers Pvt Ltd Goodwin Charitable Trust
Tanishq Mr. Perfect and Karigar Park

Saksham–Empowerment of People with

Gitanjali Jewels Disability, Saakshar– Empowerment through
Education, Sujyot – Lighting up Lives, Sneh –
Spreading Smiles

(Source: Generated by researcher using secondary data)

Figure No. 1.2.23 CSR activity of Gitanjali Jewellers

(Source: www.gitanjali.org)

1.2.2 Consumer Behaviour

It is very important to study consumer behaviour for any industry. Consumer behaviour
deals with behaviour of a consumer related to specific product (goods & services) and
the schemes associated with it. The researcher has studied the influence of marketing
strategies on buying behaviour of consumers while purchasing Gems and Jewellery.
These marketing strategies includes marketing mix strategies, service quality and

30
customer relationship management etc. These marketing strategies and their influence
is separately studied.
The researcher has studied consumer behaviour in detail which includes the factors
influencing consumer buying behaviour, the demographic analysis of consumers, the
purpose of purchasing Gems and Jewellery and the consumer buying process.

1.2.2.1 Factors influencing consumer buying behaviour

Consumer behaviour depends on various factors like demographic, social, cultural,
technological and psychological. While purchasing Gems and Jewellery consumers
also get influenced by these factors.

Figure No.1.2.24 Factors influencing consumer behaviour

(Source: Generated by researcher using secondary data)

1.2.2.2 Demographical Analysis

Demographics are the study of population based on certain factors. Demographics
highlight the statistical data about the characteristics of a population, such as the age,
gender and income of the people within the population. It also includes shopping habits,
marital status, number of children and other information about consumer
characteristics. Demographic study can be used as a marketing tool which can be the
best way to reach customers and to know about their behaviour. One can also find the
products and services which are targeted to their customers by demographic analysis.
Demographical analysis in Gems and Jewellery helps to know the fashion, lifestyle and
jewellery preferred by customers.

31
 Figure No.1.2.25 Demographical Analysis

(Source: Generated by researcher using secondary data)

While studying the marketing strategies of Gems and Jewellery Retailers, the researcher
considered the factors like age, gender, marital status, educational qualification,
occupation and average household annual income.

1.2.2.3 Purpose of Purchasing Gems and Jewellery

Customers prefer to purchase Gems and Jewellery for various reasons. Gems and
Jewellery are used as an investment by customers as majority of customers prefer to
invest in gold by buying gold jewellery which is profitable and gives value. Indian
consumers have also started treating Jewellery as fashion accessories for regular and
occasional wear. Festivals like Diwali, Dasara, Akshay Tritiya, Gudipadwa, Raksha-
Bandhan and Gurupushyamrut Yog etc. are also the main reasons for purchasing
jewellery. Customers also buy gold jewellery for gifting on anniversaries and birthdays
of their loved ones. Also customers make their occasions special by buying jewellery
on wedding season, engagement or New Year, etc.

32
 Figure No.1.2.26 Purpose of purchasing Gems and Jewellery

(Source: Generated by researcher using secondary data)

1.2.2.4 Consumer Buying Process

While purchasing any product consumer goes through five steps and those steps are
called as steps in consumer buying process. While purchasing Gems and Jewellery the
first step is need recognition (why I need jewellery?), the second step is information
search (from where I will get?) the third step is evaluation of alternatives (which is the
best jewellery amongst all?) the fourth step is purchase decision (buying the jewellery)
and the fifth step is post purchase decision (customer experience after purchase).
Figure No.1.2.27 Consumer Buying Process

(Source: Generated by researcher using secondary data)

33
Indian household expenses on Gold
On an average an Indian households spends 8.13% on gold of his overall expenses.
Figure No. 1.2.28 Indian household expenses

(Source: FICCI survey, World Gold Council)

1.2.2.5 Importance of Festivals/Occasions in Gems and Jewellery

sector
Traditionally, Gems and Jewellery products are preferred by customers on various
occasions like Diwali, Dasara, Akshay Tritiya, Gudipadwa, Dhantraydashi, Wedding
season, Gurupushyamrut Yog and other occasions like Mother’s day, Valentine’s day,
Anniversaries and Birthdays.

34
 Figure No.1.2.29 Occasions to purchase Gems and Jewellery

(Source: Generated by researcher using secondary data)

It has been the culture of Indians to gift the diamonds, pearls, gold and silver on various
occasions. These cultures and traditions influence the consumption patterns of the
buyers. While studying the marketing strategies of Gems and Jewellery Retailers, the
researcher has studied the relationship between Gems and Jewellery product categories
and occasions to purchase it.

In India festivals are celebrated as one of the most important part of our culture which
vary from region to region in which Diwali is one of the most popular festival celebrated
by we Indians, it usually falls in the month of October or November. In our country
some specific festivals or occasions are well known for buying of gold and silver. Gold
is also used at large scale on various ceremonies or programs in our country.

Jewellery retailers are also focusing on traditional ritual festivals of Indian customers.
In Ganesha festival, Gitanjali Group has associated with LalBaugcha Raja to launch the
‘Gitanjali Jewellery Vending Machine’ at Mumbai’s most popular and most visited
Ganpati-LalBaugcha Raja.

35
The most important part that carries significance is jewellery in marriages. In India
jewellery is used for both purpose dowry as well as in cultural context. Earlier jewellery
was used only to wear but nowadays it is used for investment purpose also. Craze of
gold is increasing day by day in India. Different regions of India have their own design,
culture, style and tradition has been explored to a greater extent. Technology has also
crafted gold with new modern technology with different brand names and companies.
In India gold jewellery is not remained as tradition or craft but it is an art both for design
and workmanship purpose.

Figure No.1.2.30 Festivals/Occasions of purchasing Gems and Jewellery

(Source: Generated by researcher using secondary data)

1.2.2.6 Indian Women and Jewellery

The decorative ornament worn by both men and women is jewellery. The most
decorative ornaments for women is jewellery which is made of gold, silver, and
precious stones. In making jewellery almost every kind of valuable material is used like
diamond, gold, silver, nickel and many more.

The beauty of nature is woman and the beauty of women is jewellery .Jewellery is the
most considerable adornment of Indian women. Women can have number of jewellery
since she can understand the values of that. It’s not about poor or rich women can have
or wear..! Every women have jewellery what they can afford. The jewellery was not
only about customary or saleable purpose it is our traditional symbol and values are
attached to each jewellery.

36
The beauty of women is more than everything and jewellery means a lot to her. The
women can wear the jewellery created with the precious metal like gold, silver,
platinum etc. Also every precious metal has its own value and status.

India is the country of traditions. Jewellery is the most important thing in India.
Jewellery is also for man and woman but typically it’s for women. 5000 years ago,
jewellery was not so developed but now days; jewellery is available in many varieties.
It is difficult to find out the woman without jewellery. Nowadays jewellery is not for
beautifying the woman but also have financial importance. Many times jewellery
indirectly shows your status. All over world, the Indian jewellery is unique because of
its beautiful designs.

The traditional jewellery of India has always been quite heavy consisting of voluminous
gold pieces. However, with the change in times, the contemporary jewellery which is
lighter in weight has gained a lot of popularity among the Indian women.

In today’s century women are becoming independent they are well qualified and
earning members of family and also not bound by old traditions. This tremendous
change in women leads to move them from traditional jewellery retailers to modern and
organized jewellery retailers.

1.2.3 Retail Sector in India

Organized Retailing
In organized retailing all the items related to specific product categories are sold under
one roof. The contribution of organized retail sector in the country is very less (below
10%). From last decade the Indian retail market is moving towards organized retail
formats. Malls, Supermarkets, Hypermarkets, Department stores etc are the major
types of organized retail sector. Organized retailers have common policies to run the
business and fix pricing method.

In the present research study the researcher has studied various marketing strategies of
organized Gems and Jewellery retailers in Pune city. Most of the national Gems and
Jewellery retailers are existing in the city. Global brands also have started to open their
branches and in coming years the number will grow.

37
Unorganized Retailing
Unorganized retail sector is dominating the retail sector as it contributes more than
90%. Convenience stores, local players, Street markets belong to unorganized retail
sector. In Pune city Sarafs are well known as unorganized retail players in Gems and
Jewellery sector. Unorganized retailers are large in number but small in space of retail
outlets etc. Unorganized retailers policies differ from retailer to retailer and their price
is also negotiable.

The researcher has also focused on marketing strategies of unorganized Gems and
Jewellery retailers in the city. The number of unorganized Gems and jewellery retailers
in the city is huge and it is also growing gradually. In Pune city unorganized Gems and
Jewellery retailers are also called as Sarafs.

38
 1.3 INDUSTRY PROFILE

1.3.1 Basic information about Gems and Jewellery

Scientific Information

Table No.1.3.1 Scientific Information

Symbol Atomic Molecular Biggest Producers in

Number Weight world
Gold Au 79 196.97 g/mol Goldcorp,
Newmont Mining
Polyus Gold

Silver Ag 47 107.9 g/mol Silver Wheaton Corp.

First Majestic Silver
Corp.
Pan American Silver
Corp.
Platinum Pt 78 195.078 Anglo American Platinum
Impala Platinum
g/mol
Norilsk Nickel Lonmin
Stillwater Mining

Diamond C 6 12.01 g/mol Rockwell Diamonds

Anglo American
Gem Diamonds
(Source: Generated by researcher using secondary data)

About Gold
The history of gold is very ancient, but it is auspicious for a man to have yellow metal
without antique evidence. Gold, beauty and power came together because in ancient
times, all type of ornaments were made such as: shrines and idols, plates, cups, and
vessels. Gold for man was also valuable when there was no currency and it was proven
by some extraordinary efforts.

In 700 BC gold was introduced for the first time in the form of a gold coin. Gold gave
rise to the concept of money itself because of its beauty, shortage, unique density (no
other metal outside the platinum group is as heavy). For easy trading gold and silver
coins replaced the barter arrangements.

39
Gold Purity and the Karat System:
Table No.1.3.2 Gold Purity and the Karat System
Karat System Gold Purity
24 Karat 99.9% pure gold
22 Karat 91.7% pure gold
18 Karat 75% pure gold
14 Karat 58.3% pure gold
12 Karat 50% pure gold
10 Karat 41.7% pure gold
(Source: Generated by researcher using secondary data)

Global Gold Reserves in Central Banks

In India’s global gold reserves are with central banks across the country which is an
important global economic indicator. The largest gold reserves with about 8000 tonnes
constituting about 74% of its total reserves are with USA’S fort Knox. In constituting
these reserves the rank of India is eleventh with RBI’s gold reserves of about 557 tonnes
that constitutes about 6% of its total reserves. Central bank plays a major role and holds
world’s top twenty gold holdings which is a crucial responsibility with central bank.

About Silver
The mining of silver started 5000 years ago. Atomic number of silver is 47 and it is
shiny or white color metal. Silver has long been valued as precious metal. The use of
silver is very high because it is cheaper than gold. So silver metal is used in many
bullion coins and also have strong electrical conductivity. Silver is popular metal in
rural areas and in middle class families.

About Diamonds
In India, diamonds are founded in the fourth century BC. The modern diamond market
begins in the African continent. Diamonds are found naturally and their value depends
on the four main factors color, cut, clarity and carat. All the Diamonds are mainly
graded on the basis of GIA (Gemological Institute of America) scale.

 Color: A color scale has been established by the Gemological Institute of

America (GIA), according to which the color is rated on a scale from D to Z, D

40
 being the higher rating. All the Diamonds are mainly graded on the basis of this
scale (GIA scale).

 Cut: The Diamonds found naturally are usually shapeless. Each diamond is then
shaped through an intricate process with varying levels of complexity
depending on the shape that it is making. The common shapes of a diamond are
Emerald, Round, Oval, Pear Shaped etc. Although the shapes are common each
diamond is not cut the same way since their original shape is never the same.
Hence the quality of the diamond depends on how well it has been shaped. The
proportion, polish and symmetry of the Diamond is also taken into
consideration.

 Clarity: A Diamond often has imperfections which can rarely be viewed with
a naked eye though when viewed under a 10 power magnification and that too
by a skilled diamond grader it is visible. The Clarity is the measure of the natural
imperfections in the Diamond. This too can be rated on the GIA scale as being
flawless to 13.

 Carat: The diamond is measured in ‘Carat’, which refers to the weight of the
diamond.

Figure No.1.3.1 4C’s of Diamond

(Source: www.giaindia.in)

41
 Figure No.1.3.2 Diamond Clarity Grading

(Source: www.yourdiamondteacher.com)

Diamonds manufactured in India constitute 65 per cent by value, 85 per cent by volume
and 92 per cent by pieces of the world diamond production. This is why the country is
leading the diamond manufacturing sector. The colored gemstone sector is fastest
growing segment of the Indian gems.

Due to the low labour cost in India, the diamond industry came up in the year 1960 with
the traditional diamond cutting and polishing centers in India. As more than 90%
world’s diamonds are cut and polished in India, the country became biggest center of
diamond producing industry in the world. While Belgium and Israel are dominating
larger sized, larger value diamonds while India produces lower sized, lower value
market. Almost 90% of diamonds are exported outside India which helps in increasing
the growth rate of our country.

Prime Minister Mr. Narendra Modi wants to give India the preferred place in the
production of diamonds and also make an international diamond trading hub. Gems &
jewellery is a perfect example of the potential of make in India.

About Platinum
Platinum history begins in the 18 the century and platinum has been found in object
dating from 700 BC. Like gold and diamonds, use of platinum as ornamental jewellery
is still not popular amongst customers. WPIC (World Platinum Investment Council) is
an organization which provides details about platinum sector, its growth, opportunity,
challenges and changing trends etc.

42
About Gemstones
A gemstone is founded naturally in the environment. It is then cut and polished and
later on used to make Jewellery and other adornments. There are two different types of
gemstones they are precious gemstones and the semi-precious gemstones. Diamond is
a precious gemstone while Gem is a semi-precious gemstone. The precious Gemstones
category includes Diamonds and other Gems, like Rubies, Emeralds and Sapphires. As
far as semi-precious Gemstones are concerned, they include Gems, Amethyst, Beryl,
Garnet, Lapis, Lazuli, Topaz, etc.

Figure No. 1.3.3 Different types of gemstones

(Source: www.jpearls.com)
About Pearls:

A pearl is a hard object produced within the soft tissue of a living shelled. Pearl has a
history of 4000 years ago. There are basically four types of pearls natural pearls,
cultured pearls, saltwater pearls, freshwater pearls and imitations pearls. Salt water
pearls accounts for 5% and freshwater pearls accounts for 95% of total global pearl
production. But salt water pearls have more value than fresh water pearls.

1.3.2 Jewellery Products Category

Jewellery is used on the most of the parts of the body. Hair, head neck, arms, fingers,
hands, legs etc. Each type of jewellery product like rings, bangles, necklace etc. is
designed according to its suitability and attractiveness on the body of a person.

43
 Figure No.1.3.4 Jewellery Products Category

(Source: Generated by researcher using secondary data)

Figure No.1.3.5 Jewellery Products

(Source: www.bluestone.com)

44
1.3.3 Types of Jewellery
The availability of wide variety in Indian jewellery is mainly due to the difference in
designs depending on the regional needs which include the varying tastes of people
from different cultures and their lifestyles.

The jewellery designs famous in different parts of India give a huge variety to the Indian
jewellery in both traditional and contemporary styles. The best part about the
contemporary Indian market is its beautiful blend of traditional and modern jewellery
available in both gold and silver metals decorated with dazzling precious stones that
attract everyone’s attention.

Figure No.1.3.6 Types of Jewellery

(Source: Generated by researcher using secondary data)

45
Gold Jewellery
The most important and popular type of jewellery is Gold jewellery. Almost all people
in the country wear some kind of gold jewellery. Because of its precious value it stood
first as compared to other types of jewellery.

FigureNo.1.3.7 Gold Jewellery

(Source: Generated by researcher using secondary data)

Diamond Jewellery
Diamond jewellery is the popular form of jewellery in higher income class group of
people. Diamond jewellery is specially used in occasions and parties. It showcases the
status symbol in the society. As compared to rural area diamond jewellery is much
popular in urban area and specially amongst the working women.

Figure No.1.3.8 Diamond Jewellery

(Source: Generated by researcher using secondary data)

Silver Jewellery
This segment of jewellery is the antique type of jewellery which has an antique
appearance. Different target customers tend to purchase this kind of jewellery. Apart

46
from this light weight silver with platinum finish is also available in the market for
different type of target customers.

Figure No.1.3.9 Silver Jewellery

(Source: Generated by researcher using secondary data)

Platinum Jewellery
Platinum jewellery is costly as compared to other types of jewellery. Because of its cost
and colour similarity with silver, it is not that much popular in common people. But
mostly platinum jewellery is purchased in higher income group. Small and trendy
platinum jewellery is also popular amongst young working class group.

Figure No. 1.3.10 Platinum Jewellery

(Source: Generated by researcher using secondary data)

Gemstone Jewellery
The recent trends of Gemstone jewellery are semi-precious, which are available in
different colors and shapes. Most of gemstone jewellery designs are inspired from the
independence era of the country. Gemstone jewellery is becoming most popular in
young generation.

47
 Figure No. 1.3.11 Gemstone Jewellery

(Source: www.shutterstock.com)

Pearls Jewellery
Pearls jewellery is cheaper as compared to other types of jewellery. Various designs
and patterns are available in this type of jewellery. It is symbol of todays fashion world.

Figure No.1.3.12 Pearls Jewellery

(Source: Generated by researcher using secondary data)

Imitation Jewellery
Imitation jewellery is the latest and modern segment of jewel industry. The major
reason behind the success is the domestic sales and exports; along with the
psychological need of less precious jewel of targeted customers, which could be worn
on occasions. Availability of imitation jewels at public places apart from other online
and outdoor store at a very low price is the reason for success of this jewellery segment.

48
 Figure No.1.3.13 Imitation Jewellery

(Source: Generated by researcher using secondary data)

Bridal Jewellery
The bridal jewellery is mainly created to match with the attire of the bride. The theme
and the color of the jewellery plays a pivotal role in giving it the intricate look. To add
to the attractive element of the ornaments, diamonds and various other gems are used
on the base metal of gold.

Figure No.1.3.14 Bridal jewellery

(Source: Generated by researcher using secondary data)

Fashion Jewellery
21st century is the century of fashion for customers. Each and every individual specially
women likes to wear fancy jewellery on different occasions and festivals. Todays
fashion jewellery includes all types of metal jewellery and imitated jewellery also.
Fashion jewellery is available in multiple types of designs.

49
 Figure No.1.3.15 Fashion Jewellery

(Source: www.slideshare.net)

Custom Jewellery
The jewellery which is designed as per the will and wish of a customer is called as
custom jewellery. When customer didn’t identify the jewellery designs as per his/her
demand he/she gives orders for personalized jewellery. This segment of jewellery is
more customer need based. The ornament and gems used in the jewellery are made
according to the needs of the customer. The trend in this segment changes with time.

Figure No.1.3.16 Custom Jewellery

(Source: Generated by researcher using secondary data)

Navratna Jewellery
In Navratna jewellery is a popular type of jewellery because it is considered as a symbol
of astrological significance. Nine different types of stones are used in this type of
jewellery that is the reason it is called as navratna jewellery.

50
 Figure No.1.3.17 Navratna Jewellery

(Source: Generated by researcher using secondary data)

Temple Jewellery
One of the popular type of jewellery in India is temple jewellery. This type of jewellery
products includes the designs of Gods and Goddess. People use to wear these jewellery
designs as a symbol of their religion, caste and culture.

Figure No.1.3.18 Temple Jewellery

(Source: Generated by researcher using secondary data)

Antique Jewellery
The jewellery pieces in antique jewellery usually belong to a particular period of
history, when its popularity was at its peak.

51
 Figure No.1.3.19 Antique Jewellery

(Source: Generated by researcher using secondary data)

Kundan Jewellery
In this type of jewellery kundan work is done in precise stones studded on gold and
jewellery.
Figure No.1.3.20 Kundan Jewellery

(Source: Generated by researcher using secondary data)

Meenakari Jewellery
Meenakari jewellery is a type of jewellery in which precious stones are enameled with
gold.
Figure No. 1.3.21 Meenakari Jewellery

(Source: Generated by researcher using secondary data)

52
Maharashtrian Jewellery
In Maharashtra traditional jewellery is more popular. In Maharashtra the jewellery is
specially purchased during marriages and jewellery becomes a part of her daily
wearable item. Mangalsutra, Thushi, Nath, Chandrahar and Mohanmal etc are popular
forms of Maharashtrian jewellery.

Figure No. 1.3.22 Maharastrian Jewellery

(Source: Generated by researcher using secondary data)

Foreign Players in Gems and Jewellery Sector

Foreign retailers are entering in India in all sectors including Gems and Jewellery. The
study of last 20 years shows that, there was no case of domination of foreign retailers
in fact the market for global retailers is expanding day by day. But a few retailers have
tried that too with lot of cautions, as they have noticed that, a retailer’s success depends
upon local knowledge rather than global strategies. The factors which attracted the
global investors in India are mainly economics policies, availability of cheap human
resource & business opportunity.

In todays world, the leading jewellery manufacturer are innovating new designs and
production to suit the specific requirements of markets around the world. India is a
jewellery manufacturing hub which offers incredible collection. Due to India’s long
tradition of jewellery making, different states of India have their own specialties of
intricate handmade styles, forms, various designs and styles of jewellery.

53
1.3.4 Important Organizations related with Gems and Jewellery
Sector

Table No.1.3.3 Important Organizations related with Gems and Jewellery Sector

Year of Head
Organization Establishment Quarter Objectives
GJEPC (Gem &
Jewellery Export Promoting export of
Promotion Indian Gems and
Council) 1966 Mumbai Jewellery abroad

GJF (All India To promote the growth of

Gems & Indian Gems and
Jewellery Trade Jewellery sector across
Federation) 2010 Mumbai the country.
To stimulate and sustain
demand for gold, provide
London industry leadership and
WGC (World United be the global authority on
Gold Council) 1987 Kingdom the gold market.

(Source: Generated by researcher using secondary data)

Gem and Jewellery Export Promotion Council – GJEPC

The Government of India has designated the Gem and Jewellery Export Promotion
Council (GJEPC) as the importing and exporting authority in India. Ministry of
Commerce in India has set up this organization. GJEPC is established in 1966 and more
than 6000 exporters are associated with it.

54
Gems and Jewellery Federation

All India Gems and Jewellery Trade Federation is established in the year 2010. It
represents more than 3 lakh Gems and Jewellery businesses across the country, which
includes manufacturers, wholesalers and retailers in this sector.GJF also takes
initiatives in CSR activities.

World Gold Council

The key marketing body of gold industry is world gold council which was incorporated
in 1987. Around 40% of total gold production is with world gold council. World Gold
Council is leading marketing organization. The world Gold Council is an international
organization, and not for profit purpose. The offices of world council are in India,
China, Japan, Turkey and North America. World gold council mainly deals with
manufacturers, banks, wholesalers, jewellery retailers and distribution companies to
promote the use of gold.

Pune Sarafs Association

Pune Sarafs Association is an association of unorganized Gems and jewellery retailers
in Pune city. More than 600 retailers are registered under this association. This
association has common policies for registered members. They also launch schemes for

55
customers like Suvarna Sanchay, Suvarna Bhishi Yojana etc. Suvarna patra is the
popular magazine of this association.
Figure No.1.3.23 Pune Sarafs Association

(Source: Generated by researcher using secondary data)

Bureau of Indian Standards-BIS

A supreme agency in India to operate the BIS hall marking scheme was identified by
government of India as bureau of Indian standards. This scheme was launched with
World Gold Council on hallmarking. In this scheme, jewellery retailers are given
licenses by BIS to sell Jewellery with hallmarking sign. One of the best method to
identify the purity of gold is hallmarking.

Hallmarking Act was passed by world gold council in 2000 to measure the purity of
gold. In India from January 2008, it was necessary for jewelers to sell the ornaments
with the marking, symbol and logo of hallmarking which ensures purity of Jewellery.

Figure No.1.3.24 Jewellery Hallmarking

(Source: www.dianoor.com) `

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 Figure No.1.3.25 Hallmarking for different jewellery categories

(Source: purelydiamonds.com)

1.3.5 Gems and Jewellery Sector in India

1.3.5.1 Jewellery Market
 Jewellery segment contributes 6% in overall retail sector of India. In overall
jewellery segment organized jewellery sector contributes 36% in that organized
national jewellery retailers contributes only 6% and organized regional retailers
contributes 30%. Still unorganized sector is dominating in jewellery sector with
64% contribution. In India overall market growth rate is 12-15% while
organized retail sector is growing with 30-40%
 Jewellery market in India is divided into three major segments, first is Gold
jewellery, second is diamond and diamond studded jewellery and third is silver
and platinum jewellery. In this gold jewellery contributes almost 80% of overall
jewellery segment and diamond jewellery contribute 15% and silver and
platinum jewellery contributes only 5%.
 Gitanjali jewellers group is the major organized Gems and Jewellery retailer in
the country. Only Gitanjali group contributes 41% of overall Gems and
Jewellery segment in the country.
 Overall Gems and Jewellery export is fluctuating in the year 2017. Diamond
jewellery export of India is also declined by 4% in 2015-2016 as compared to
previous year.

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Figure No.1.3.26 Contribution of jewellery retail sector in overall Indian retail
market

(Source: ONICRA, Indian Retail report, Tech SCI Research)

Figure No.1.3.27 Regional and National retail sector of Gems and Jewellery

(Source: AT Kearney, PC Jeweller)

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 Figure No. 1.3.28 Jewellery market in India: size and growth (2016)

(Source: ONICRA, Indian Retail report, Tech SCI Research)

Figure No.1.3.29 Jewellery market classification

(Source: ONICRA, Indian Retail report, Tech SCI Research)

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 Figure No.1.3.30 Organized retailers contribution in overall jewellery market

(Source: slideshare.com)

Figure No.1.3.31 Export of Gems & Jewellery

(Source: Gems and Jewellery Export Promotion Council)

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 Figure No.1.3.32 Diamond jewellery exports from India

(Source: Gems and Jewellery Export Promotion Council)

1.3.5.2 Clusters in Gems and Jewellery Industry in India

Table No.1.3.4 Clusters in Gems and Jewellery Industry in India
Clusters in Gems and Jewellery Industry City State

Polishing precious and semi-precious Jaipur Rajasthan

gemstones
Diamond processing center Surat Gujarat

Machine made jewellery Mumbai Maharashtra

Gold jewellery and diamond cutting Trichur Kerala

Casting jewellery Coimbatore Tamil Nadu

Captive source for handmade jewellery Nellore Andhra

Pradesh
Precious and semiprecious studded jewellery Hyderabad Telangana

Lightweight plain gold jewellery Calcutta West Bengal

Silver jewellery and articles Delhi Delhi

(Source: Generated by researcher using secondary data)

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1.3.5.3 Value Chain Analysis of Jewellery Industry
Almost all Gems and Jewellery products goes through the common process, it includes
mining, processing, fabrication and retailing. At the last stage of value chain process
the product is made available by the retailer to the customer of domestic as well as
international market.

Figure No.1.3.33 Value Chain-Diamond and Gold

(Source: D & B Research)

1.3.5.4 Jewellery yesterday and today

Previously customers use to buy unbranded jewellery products. Customer used to buy
gold and silver jewellery for investment purpose. Traditional designs were mostly
preferred at that time. Marriages and festivals were the occasions when the sale was on
the peak. Jewellery was sold on commodity basis with labour charges.

Nowadays, customers prefer to buy branded jewellery products. Gold and diamond are
the most loved jewellery categories. Customers buy jewellery not only for investment
but also for fashion purpose. Customers prefer fashionable and innovative designs.
Jewellery products are used for wearability and Gifts. And nowadays jewellery has been
sold on per piece basis.

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1.3.5.5 Key Success factors of the Gems and Jewellery Segment
Gems and Jewellery segment is growing in the country because of following reasons;
 Continuous traditional demand
 Important savings and investment instrument
 Jewellery as a fashion and status symbol
 Increasing affordability
 Movement from unbranded to branded jewellery
 Hallmarking and Certification
 Increased use of technology
 Transformation from family owned businesses to professionally managed
businesses

1.3.5.6 SWOT Analysis of Gems and Jewellery Retail Sector in India

Table No. 1.3.5 SWOT Analysis of Gems and Jewellery Retail Sector
STRENGTHS WEAKNESSES
 Large integrated diamond &  Conflicts of interest between
jewellery players organized & unorganized players
 Strong marketing & distribution  High inventory carrying costs
network
 Strong retail presence
 Strong brand equity and broad
product range
 Financially very strong sector
 Highly skilled, qualified and
motivated employee
 Long relationship with dealers

OPPORTUNITIES THREATS
 Entering New Markets  International Competition
 Cutting and Polishing of Large-  local competitors
Sized Diamonds  Price Fluctuations
 Growing Jewellery Retail  Other Investment Substitutes to
 Outsourcing Hub Gems and Jewellery
 Export-Oriented Business
 Fast Growth Rate 12%

(Source: Generated by researcher using secondary data)

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1.3.5.7 Jewellery Sector in India in 2017
India’s Jewellery industry suffered in FY2016-17. New policy initiatives, aimed at
purging India of black money and instilling greater transparency, have rocked the
country’s economy, including its gold market. The 1% excise duty on jewellery
manufacturing prompted a 42-days strike. The income disclosure scheme disrupted the
black market – fearing a backlash from tax officials, some consumers postponed buying
jewellery. And demonetization initiative caused a liquidity squeeze that affected the
entire economy. These policies, combined with fragile rural sentiment and a soaring
gold price, pushed jewellery demand to its lowest level since 2009. And now the 3%
Goods & Service Tax (GST), all this will change the shape of the industry.

Table No. 1.3.6 Jewellery Demand and Investment of India

2015 2016 Change %
. Jewellery Demand
(in tonnes)
World Total 2388 2041 -15
India 662 514 -22
Jewellery Investment
(in tonnes)
World Total 918 1561 70
India 195 162 -17

(Source: World Gold Council, Gold demand trend report 2016)

1.3.6 Gems and Jewellery Retailers in Pune city

About Pune city
Pune is the cultural capital of Maharashtra. It is the second largest city in population in
the state after Mumbai. As per 2011 census the city’s population is 31,24,458 of which
male population is 16,03,675 and female population is 15,20,783. Pune city is governed
by Pune Muncipal Corporation (PMC), established in the year 1950. Pune is well
known as educational hub of the country. The city has many Govt. organizations &
public sector undertakings. The city has largest number of IT companies in India, after
Hyderabad & Bangalore. The city is also close to Mumbai city which is an economic
capital of the country. This geographical connectivity helps retailers to set up their
business in Pune.

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In 2016 Prime Minister Modi also declared to make Pune as a smart city in upcoming
years and also started to take some initiatives in this regard. Under the smart city project
Government of India have already launched more than 14 projects in Pune city in last
one year.
Figure No. 1.3.34 Map of Pune city

(Source: www.mapsofindia.com)

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Organized Gems and Jewellery Retailers in Pune city
In ancient and medieval era the various forms of Gems & Jewellery were popular in the
city.
In modern era after independence jewellery business started to grow in the city. In last
5 years, some major jewellery retailers entered into the city like Kalyan Jewelers, Joy
Alukkas, and Goodwin Jewellers etc.
After LPG in 1991, organized retail business spread its wings in the country in all
sectors including Gems and Jewellery.
The changing lifestyle of people in the city increased the Gems & Jewellery
consumption; it has given drive to Gems & Jewellery retailers for business
development. Following are the major regional and national organized Gems &
Jewellery Retailers in the city;

Table No. 1.3.7 Organized Gems and Jewellery Retailers in Pune city

Organized Gems and

Organized Gems and Jewellery
Sr. Jewellery Retailers in Pune Sr.
Retailers in Pune city
No. city No.
1 P N Gadgil & Sons 14 D'damas
2 Ranka Jewelers 15 ORRA Jewellery

3 Kalyan Jewellers 16 Malabar Gold & Diamonds

4 Rajmal Lakhichand Jewellers 17 Krishna Rajaram Ashtekar

5 Reliance Jewels 18 Chandukaka Saraf & Sons

6 Gitanjali Jewels 19 Lagu Bandhu Jewellers

7 Joyalukkas Jewellery 20 Kothari Diamonds and Jewels
8 Goodwin Jewellers Pvt Ltd 21 Waman Hari Pethe Jewellers
9 Tbz Jewelers 22 Nakshatra Jewellery
10 Tara jewellers 23 P N Gadgil Jewellers
11 P N Gadgil & Diamonds 24 Waman hari pethe sons
12 Tanishq 25 Gilli
13 Asmi
(Source: Generated by researcher using secondary data)
Figure No. 1.3.35 Organized Gems and Jewellery Retailers in Pune city

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(Source: Generated by researcher using secondary data)

Unorganized Gems and Jewellery Retailers in Pune city

The unorganized retailers have their existence in all parts of the city. They are called as
Sarafs and they also have their association in the city. Following are the unorganized
Gems & Jewellery Retailers in the city selected for the research study.

Table No. 1.3.8 Unorganized Gems and Jewellery Retailers in Pune city

Sr. Unorganized Gems & Sr. Unorganized Gems &

No. Jewellery Retailers No. Jewellery Retailers
1 ALANKAR JEWELLERS 27 SHRI M.M ASHTEKAR 0
2 ASHOKKUMAR INDRARAJ &CO 28 SHRIKISAN VARMA & CO
3 YOGENDRA D. ASHTEKAR&CO. 29 MAHAVIR JEWELLERS
4 SHAH BHBUTMAL VAKTAJI& CO 30 MEHTA JEWELLERS
5 BHAGAJI DEVAJI&CO 31 M.A.MOTIWALE
6 BHAGAWAN FATAJI &CO 32 MOHAN VITTHAL JADHAV
BHAU CHINGUSHETH
7 SHIVARKAR 33 NAGARKAR & SONS
8 SHRI CHANDAN SARAF 34 NIRMAL JEWELLERS
PRAKASH NARAYANDAS
9 CHENMAL KHUMAJI SARAF 35 SARAF
10 CHOKSI PUKHRAJ & SONS 36 SALUNKHE &CO
CHOKSI DHIRAJMAL CHUNILAL
11 KAWEDIYA 37 RAJMAL MANIKCHAND &CO
12 D.B. GHODKE SARAF 38 RATANCHAND DALICHAND
13 DEOKAR JEWELLERS 39 SHRI S.B.PENDNEKAR & SONS
14 DEVICHAND KANAJI &CO 40 SESMAL KUPAJI
15 DEVAJ PRAVINKUMAR RATHOD 41 SHELUKAR SARAF

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 SHRIPAD SHANKAR
16 F. MANIKLAL BALDOTA 42 NAGARKAR SARAF
17 GANESH JEWELLER 43 SUKANRAJ S.PARMAR
SUKANRAJ SHOBHANCHAND
18 GHODKE SARAF& SONS 44 SAKHARIYA
19 GIRISH JEWELLERS 45 UMESH JEWELLERS
20 GUNDESHA JEWELLERS 46 V.S.WAIKAR & SONS
21 SHA. HANSAJI JITAJI SARAF 47 V.A.YEOLEKAR
22 J.P.JEWELLERS 48 KRISHNA JEWELLERS
23 JAMBU JEWELLERS 49 VITTHAL MARTAND BANSOD
24 KHARI PEDHI 50 VINAYAK JEWELLERS
25 POONA JEWELLERS 51 PARMAR JEWELLERS
MOTIWALE SANGALIKAR
26 SARAF JAVERI 52 K PADMAKAR & SONS

(Source: Generated by researcher using secondary data)

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