Final Tanishq marketing strategy

7/22/2019 Final Tanishq marketing strategy

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INTRODUCTION ABOUT TANISHQIn a market that has traditionally been dominated by

family jewelers, it took the entry of Tanishq, Indias

largest, most desirable and fastest growing jeweler brandfrom the house of Titan in 1995, to give Indians access to

a product whose promise was truly as good as gold.

Tanishqs appeal lies in the wealth of its designs and

purity of gold. It has won the trust and admiration ofcustomers and created a unique position for itself in the

marketplace.

The association with Bollywood blockbusters likes

Paheliand Jodhaa Akbar and the 2003 Miss India beautypageant have enhanced the brands appeal, lending it an

aura of elegance and grandeur.Tanishq stands out as a brand that abides by values of

Trust worthiness, credibility and respect. The power ofBrand was further enhanced with the introduction of

karatmetersa tool that helped customers gauge the

quality of their goldin every Tanishq outlet.

By introducing revolutionary, innovative designs in amarket that worships tradition, the brand created its own

tradition of retail success. Yet Tanishq is more than just a

jewellery retailer. It stands for reassurance of quality andethics. The fact that it belongs to the Tata family assures

the customer that with Tanishq, all that glitters is

certainly pure gold.


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TAN + ISHQ = BODY + LOVEThe essence of this name is derived from the Urdulanguage, a Persian Arabic form of dialect.

The reason d'tre behind electing this unique name forthis company is the fact that women and men alike had

realized the magnificence of the human anatomy sincetime immemorial.

Beautifying the human body was a primary part of thedaily routine, which took several hours of intense care.

Though today things have changed drastically, and time

very precious to one and all, nonetheless beauty remainsa primary concern in the day-to-day activities of everyman and woman.

Consequently the name Tanishq is synonymous to 'love

for your body', where Tan signifies the body and ishq,love.

LAUNCHING OF TANISHQTitan launched Tanishq in 1995, India's largest, mostdesirable and fastest growing jewelry brand in India.

Diligent care and quality processes ensure that theTanishq finish is unmatched by any other jeweler in thecountry.

Tanishq challenged the age-old jewelers word withTATA's guaranteed purity. It exploded the market with

facts about rampant impurity across India. It introduced

technology-backed challenge in a category completelygoverned by individual trust. Tanishq introducedinnovations like Karat meter, the only non destructivemeans to check the purity of gold.

In its early days, Tanishq was positioned as aninternational jewellery brand for the Indian elite. This


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meant it catered to a niche market. Moreover, its Italian

designs in 18-carat, mostly studded jewellery did not godown well with the traditional Indian woman, used as she

was to 22-carat jewellery. Abandoning its westernised

look, Tanishqs designers chose to work on a fusion ofcontemporary and traditional Indian motifs.

PRODUCTThe Tanishq portfolio comprises a wide range ofjewellery, including 18-carat studded products, 22-carat

plain-gold products, silverware and coins. Tanishq is thefirst brand in the jewellery category to introduce

collections designed exclusively for the modern Indian

woman, especially working women.

Among the Tanishq collections that have caught the

imagination of consumers is Aria, which draws

inspiration from the traditional seven-stone jewellery that

Indian women have worn for over 100 years. Aria addeda contemporary element to the traditional setting of the

seven-stone cluster by using diamonds of different shapesand sizes. The use of rhodium plating alongside the

yellow gold gives this product a unique look, modern aswell as traditional.

Other winners from the Tanishq stable include Diva,

which has pearls encircled by diamonds, Hoopla, which

boasts diamond hoops, and Solo, a collection that uses

solitaire diamonds. Collection G, with a selection of over90 designs, addressed the everyday jewellery needs of

working women. Positioned as 9-to-5 jewellery, thecollection is stylish and modern and is designed to suit all

forms of attire, western and Indian, casual and formal.

The introduction of lightweight goldjewellery thatlooked heavy but was light in weight and on the purse

marked another milestone in Tanishqs brand history.


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RECENT DEVELOPMENTSTanishq has veered away from the high-end French look

that it started out with to jewellery that is design-

differentiated and yet wearable. This shift in its designethos has helped make the brands products moreaccessible to Indian women.

The Tanishq of today has little to do with conspicuous

consumption and much to do with meeting theaspirations and emotional needs of consumers.

Tanishqs retail boutiques are temples for the brand and

are used as a platform for celebration, be it the launch of

a new collection, a new marketing promotion or afestival. This gives Tanishq outlets a unique appeal andconsumers an opportunity to heighten their shopping

experience. The launch of new collections such as

Dancing Diamonds, Ethnic Gold, Paisley, Dewdrops and

Avataar has enabled Tanishq to establish itself as afrontrunner in the fashion jewellery scene.

One of Tanishqs more innovative ideas is to offer

special schemes during various festivals. Given Indiasdiversity, this is never a one-size-fits-all initiative; rather,

it means having different promotions at different times ofthe year in different parts of the country. So, whether it is

Varalakshmi Puja in Andhra Pradesh, Durga Puja in

Bengal, Onam in Kerala or Karva Chauth in the North,

the brand celebrates it with its consumers in the rightcultural spirit.

PROMOTIONTanishq has deliberately moved away from mass-mediaadvertising and focussed on store promotions to make the

brand more accessible to consumers. This has been doneto correct the consumer perception that the brand is

highly priced and only meant for the rich and the famous.

This approach has also ensured that Tanishqs


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promotional approach is product-led. Promotions are

organised from time to time to activate the market.These events reinforce the image of Tanishq as a trusted

leader. The Impure to Pure Exchange offer is an

example of one such activation-based promotionalcampaign. Under this scheme, jewellery buyers could

exchange their impure jewellery of any caratage forTanishqs 22-carat jewellery. During the promotion it

offered to value consumers old gold jewellery of 17-carat and above on Tanishqs Karatmeters.

Between August 1st and August 15th 2001, Tanishqembarked on a promotion where discounts of up to 20%

were offered on all its jewellery. This was to say thank

you to a million consumers on the fifth anniversary of thebrands launch. Over 100,000 people shopped at Tanishqboutiques during this period.

Another consumer loyalty programme that has beeninitiated by Tanishq is called the Golden Harvest Savings

Scheme, which offers buyers the benefit of getting morejewellery than what they have paid for. The scheme

allows consumers to plan future purchases in advance

and pay for them in easy instalments. Consumers can

choose from two plans: a 12-month annual plan and an18-month extended plan (the monthly installment can be

for any amount upwards of Rs. 500). Tanishq contributes60% of the last monthly instalment in the annual plan and

130% of the last monthly instalment in the extended plan,

both of which are part of the final price that the consumerpays for the product.

BRAND VALUESIn sync with the Tata brand values, Tanishq is

synonymous with trust and purity in a category that is

fraught with questionable practices. Being a member ofthe Tata family has meant that it can leverage the groups

well-earned reputation for ethics and values in a businesswhere such attributes are critical to win the trust of


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consumers. Tanishq consumers can afford to take issues

such as purity for granted, and they know they candepend upon the brand to deliver quality products all the

time. The brands winning virtues in design and overall

quality have shaped a class of discerning buyers whoseek the best in jewellery products.

Leadership and innovation are two of the other brand

features that Tanishq is consistently identified with.These values have helped the brand bond with itsconsumers like no other Indian jewellery retailer.

TANISHQ IN INDIATANISHQ is India's largest, most desirable and fastestgrowing jewelry brand in India. Started in 1995, Tanishq

is the jewelry bu si ne ss gr ou p of Ti ta n Indu st ri esLtd - pr omot ed by t he TATA group, India's

most r espected and widely diversi fied businessconglomerate.

This year marks a decade of successful innings for

Tanishq. With a retail sales of 1200 crore lastyear and gunning for2000 cror e this year ,

Tani shq has arri ved in the Indi an jewelrymarket. It is a story of a successful Indian enterprise,

which has delivered value to its customers and

shareholders in a complex category, marked by it s

complete ly locali zed front end as well as backend .Tani shq has se t up p roduc t ion and

so ur ci ng ba se s w it h through research of thejewelry crafts of India. Jewelry at T a n i s h q i s

c r a f t e d i n o n e o f t h e w o r l d ' s m o s tm o d e r n f a c t o r i e s . T h e f a c t o r y

c o m p l i e s w i t h a l l t h e l a b o r a n denvironmental standards. Located at Hosur, Tamil Nadu,

the 1,35,000 sq. ft . factory is equipped with the latestand most modern machinery and equipment. Every

product at Tanishq i s p a i n s t a k i n g l y c r a f t e d t o


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p e r f e c t i o n . D i l i g e n t c a r e a n d q u a l i t y

p r o c e s s e s e n s u r e t h a t t h e T a n i s h qf i n i s h i s unmatched by any other jeweler in the

country.

Tanishq challenged the age-old jewelers word with

TATA's guaranteed purity. It exploded the marketwith facts about ram pa nt imp uri ty ac ros s Ind ia .

I t in t roduced technology-backed chal lenge ina category complete ly governed by

i n d i v i d u a l t r u s t . T a n i s h q i n t r o d u c e d

i n n o v a t i o n s l i k e K ar at me te r, t he on ly n onde st ru ct iv e me an s to ch ec k t he purity of gold.

Tanishq a lso in t roduced profess ionalre ta i l ing in the disorganized Indian jewelry

bazaar , where women can shop with comfort and

peace, without worrying about the purity of the jewelry

they are buying, as well as, select from the

best jewelry collections available in the Indian market.

Tanishq today is India's most aspirational fine

jewelry brand with 91 stores in 64 ci ties, with an

exquisite range of gold jewelry studded with

diamonds or coloured gems and a wide r a n g e o f

e q u a l l y s p e c t a c u l a r j e w e l r y i n 2 2 K t p u r e

g o l d . Exquisite platinum jewelry is also part of the

product range.

Jewellery is one of the last great commodity frontiers i n

India; i t has remained so because this market i s

v e r y f r a g m e n t e d , v e r y m u c h u n o r g a n i z e d .

T a n i s h q h a s successfully taken on the challenge oftransforming t h i s f r o n t i e r i n t o a r e l i a b l e

c o n s u m e r s p a c e b y b r i n g i n g t o i t a l l t h e

v i r t u e s a n d b e n e f i t s t h a t branding offers

- Harish Bhatt, CEO, Tanishq


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GiliGili was launched in 1994, targeting mainly the

youth who wanted to celebrate Valentine's Day.Since then, the brand has clocked a turnover of Rs. 90

crores.

Nirvana DiamondsNirvana Diamonds from Fine Jewellery (I) Ltd. was

launched in 1987 in India. Nirvana diamonds are

targeting at fashion c o n s c i o u s , mo d e r n a n d

i n d e p e n d e n t t h i n k i n g w o m e n .I n t e r n a t i o n a l l y a c c l a i m e d

N i r v a n a d i a m o n d s a r e manufacturedby using s tate -of- the-ar t technology. As a

proof of their quality Nirvana was among one of the

brands to offer lifetime warranty to its consumers.

D'damas DiamondsD'damas Diamonds are part of Gitanjali Digi co

Group and one of the earlies t diamond housesestablished in India in1966. On the present day

D'damas Diamonds offer highly modernized

diamond cutting and polishing facilities at five

locations in India. D'damas Diamonds claim topromote arange of emotions through their collections


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Adora DiamondsA d o r a D i a m o n d s w e r e l a u n c h e d i n I n d i a i n

Ju l y 20 0 3 b y Mumbai based Concept Jewelry

(India) Ltd. On the present da y th e st i l le x p a n d i n g r e t a i l n e t w o r k c e n t e r s o f A d o r a

expands to 117 outlets in 47 cities of India.Adora means glory in Spanish and cl aims t hat

it s di amo nd co ll ec ti on is themed on love. Adoradiamonds are for adornment of every mo me n t ,

o c c a s i o n , a n d p h a s e o f l i f e t h r o u g h i t s u p

and downs. The Swaranjali signature collection

of living legend Lata Mang eshk ar is a un iq uefeature of Adora diamonds . Each piece of

Swaranjal i col lect ion i s conceptual ized andapproved by Lata Mangeshkar and bears her

laser printed signature

Kiah DiamondsWorld's largest volume manufacturer of

diamonds-Sheetal manufacturing Company(SMC) launched its exquisite Kiah diamond

col lect ion in October , 2004. Kiah diamondsare claims to be for celebrating womanhood.

The brand name 'Kiah' means beautiful place. Onthe latest Kiah diamonds have won the Best

Showroom in the DTC Diamond season for 2005

2006.


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TANISHQMARKET RESEARCH

MARKET research On TANISHQ

Tanishq emerges as the best known brand with the

highest awareness and recall. The differencebetween the leaders and the followers is always

greater when the former have a he ad st a rt . An dwhen the pace and ef for ts of the leaders

intensify, the possibility that they will continue to beat the top is a fore gone conc lusi on.

Th e So li ta ir e - TN S Su rv ey shows that Tanishq is

the best known brand across the three cities of Mumbai,New Delhi and Bangalore, a finding which lends

credence to the leadership factors. More than 65percent of the target audience had no hesitation

in coming up with the name, proving that the

extensive branding exercise u n d e r t a k e n b y

T a n i s h q ( a d i v i s i o n o f t h e T a t a g r o u pcompany, Titan Industries) has paid off well. Two

decades in the business, over 70 retail outletsacross the country and p i o n e e r i n g e f f o r t s

t o m a k e j e w e l l e r y b u y i n g i n t o a n

u n f o r g e t t a b l e s h o p p i n g e x p e r i e n c e - a l l

t h e s e f a c t o r s combined to make the brand into ahousehold name.

India's Top Ten Best Known Jewellery Brands


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THE SURVEYT h e I n d i a n j e w e l l e r y i n d u s t r y i s s e e i n gu n p r e c e d e n t e d activity on the market front with

new entrants coming in all t h e t i m e .C o n s u m e r b e h a v i o r a l s o i s

u n d e r g o i n g a transformation. The Solitaire-

TNS Survey to find out India's be s t k n o w n

b r a n d s ( a n d o t h e r p e r t i n e n t d e t a i l s ) w a sinitiated with a view to assist and equips the

indus try wi th information that goes beyond the

ordinary.

" M e n b u y p r o d u c t s w h i l e w o m e n c h o o s e

b r a n d s , " s a ys model-turned-designer and CEO ofa billion dollar company, Kathy Ireland, a fact which

jewellery brand managers in India wi l l n o t r e f u t e .H e n c e t h e S o l i t a i r e - T N S S u r v e y a c r o s s

Mumbai, New Delhi and Bangalore was targetedsolely at women.

While the sample s ize was smal l , 600+, thefact that the target group was covered in andarou nd shop ping mall s, banks, corporate areas

and commercial zones, made the samp le mor erelevant to the object ives . The survey was

conducted through personal interviews over a periodof 15days.


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TURNAROUND STORYWhen we started out we didn't think that wecould achieve this, but now being jewellers tothe na tion doesn't seem so distant

.

- Tanishq COO, Vasant Nangia, in March 2000.

The Unsuccessful Launch

In 1995, Ti tan Indus t r ies , India ' s leadingmanufacturer of watches, launched the Tanishq

range of gold watches and jewellery. Till then, theIndian jewellery market was to a large extent

unorganized, with a few recognized names suchas Tribhovandas Bhimji Jhaveri and Mehrason's.

Tani shq, an en t i r e l y n ew con cep t i n t heI nd i a n ma r ke t , t hus had t o s t ruggl e ha rd to

be accepted by the cus tomers . Indust rywatchers were extremely skeptical of Tanishq

and doubts were being cast over its prospects. Tanishqbegan by offering jewellery in the 18-carat gold

range, with designs borrowed heavily fromcontemporary European brands. The

company justified its decision saying that itwanted to be 'd iffe rent ' from the traditional Indian

offerings.

Tanishq per formed very badly in the nextthree years, posting a huge loss in 1997-98,

proving its detractors right. Jacob Kurian,

Tanishq ' s chief operat ing of f icer admit ted ,"Tanishq, as a concept, was far too ahead of its times."

Even if one agreed with Kurian, it could not be denied

that Tanishq did commit mistakes.


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Analysts decreed that the company's strategies were

wary. A t t h i s po i n t , T an i s hq t ook va r i o usst ep s to co rr ec t th e mistakes i t had committed

and very soon, posted its first ever operating

profit in 1999. In 1999-00, sales doubled to Rs1532 million against Rs 743.8 million recorded in 1998-

99a n d r e a c h e d R s 2 0 0 0 m i l l i o n i n 2 0 0 0 - 0 1 .Ta ni sh q fa re d equally well on the export front

also with heavy exports to UK, US, Australia andWest Asia.

Tanishq was the larges t overseas chain in

US wit h 1 ,20 0outlets. In the year 2000, exports

contributed 10% to the company's turnover. The

story of Tanishq, once written off as a losing proposition,

making a remarkable turnaround was anexample of acompany single-mindedly working to make its own

mark in the t radi t ion bound Indian jewel lery

ma rk et .Behind this success was, of course, a well-

planned and well-executed marketing plan.

Background NoteTitan Watches Limi ted was promoted jo int ly

by Ques ta r Investments Limited (a Tata group

company) and Tamil Nadu Indust rial DevelopmentCorporation Limited (TIDCO). The company,

incorporated in July 1984 in Chennai, was started intechnical collaboration with France Ebauches (a

French company), one of the world's largest

manufacturers of watch mo veme nts . In i t ial lyinvo lved in th e wat ches and c lock s business,Titan later ventured into the jewellery

businesses. The company was India's leadingmanufacturer of watches, marke ted under the Titan

and Sonata brand names with a25% share of the

total domestic market.


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Titan established its first manufacturing facilityin Hosur , Tamil Nadu and i ts f i rs t sate l l i te

wa tc h as se mbly un it at Dehradun, Uttar Pradesh

was started in 1990. In 1992, Titan set up a jointventure, Timex Watches Limited, with Timex

Corporation of USA to market Timex watches inIndia.1 Andin 1995, Titan changed its name from 'Titan

Watches Ltd.' to' Titan Industries Ltd.' in order tochange its image from that of a wat ch

manufacturer to that of a fashion accessor ies

manufacturer. In the same year, it also started itsjewellery division under the Tanishq brand. At th is

point of time, the jewellery business was highly

locali zed and the concep t o f branded jewellery didnot exist. In the late 1990s, India had around 0.2million jewellers scattered across the country.

Jewellery had predominantly been used as an

investment rather than adornment. Hence, a change in

the perception of jewellery from an asset to a fashion

accessory was extremely difficult to bring about.

People generally bought gold from th e s a me

f a m i l y j e w e l l e r t h e y h a d t r u s t e d i m p l i c i t l y

f o rgenerations. Moreover, these jewellers made thejewellery to order and often bought back their

products at the prevailing market rates.

Thus , f rom the very beginning, Tanishq

f ound it har d to ove r c ome t he I nd i a n

co ns um er ' s pr efe re nc e for bu yin g traditional

jewellery only from family jewellers. The sleek and

contemporary designs being offered did not go

down well with the Indian customer who was used

to heavy, traditional designs.


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Vasant Nangia, erstwhile Chief Operating

Officer, Tanishq said, " When we la unch ed t he

Tanishq r ange, ou r designs were not

appreciated initially as they were believed to be

ext remely Western . Also, we of fered only 18carat gold ."Over a per iod of t ime, Tanishq ' s

research revealed many other loopholes in its

strategies.

Setting Things RightTanishq found out that it had gone wrong mainly in twoareas- the product proposition and retailing. Initially

with a focus on th e ex po r t ma rk et , i t sde si gn s w er e p re do mi na n tl y Western, and the

same line of jewellery was sold in India as well.H o w e v e r , w h e n i t s h i f t e d i t s f o c u s t o t h e

do me st i c market, i t was unable to sell these

designs. Therefore the first step was to change

the brand positioning from that of an elitist andWesternized offering to a more mainstream,

Indian one. The 18-carat jewellery range wasexpanded to include 22 and 24 carat

ornaments as well . Tanishq also made

attempts to redefine traditional styles in its

designs. Tanishq real ized that , gi ven thedive rs e natu re of In dia n ethnicity, it would have to

cater to tastes of all regions.

Therefore, the emphasis shifted from the erstwhile

modern de s ig ns t o mo re e th n ic one s an dt ra di ti on al or n am e n t s (based on designs from

various states) were launched. The comp any al so

began seasonal and local ized promotions based on Indian festivals, such as during Durga Puja

in West Bengal, Onam in Kerala, Diwali in north


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India, etc. Johnson Verghese, divisional head,

sales and marketing, s aid, "We also decided to go in

for transmigration of designs. So we not only got in

more Indian mot i fs but a lso s tar ted s tocking

typical designs from Tamil Nadu in Mumbai andthose from Beng al in Delhi . These desi gns,

th oug h Ind ian , pro vi de the variety to what the

people in a particular area were used to seeing."

Tanishq's team of in-house designers came out with

about 3,500 designs based on current t rends

and the feedback f rom s tores . At leas t 10% of

these designs were changed every quarter and

fresh ones were added to the stock.

Tanishq gave complete freedom to the retail outlets

to pickup d esigns, which they thought woul d

sel l in thei r s tores . Almost a l l the out le ts

stoc ked the 'bes t se llin g' rang e o f designs,

which did well across the country. T a n i s h q wa s

n o w p i t t e d d i r e c t l y a g a i n s t t h e

t ra di ti on al jewellers who were offering similarornaments. In order to add some value

proposition to rise above the

competition, Tanishq decided to address the

issue of gold pur ity , which was most important to

the customers.

Traditionally, conventional jewellers used the

touchstone to t e s t t h e p u r i t y o f g o l d .

A p a r t f r o m t h e f a c t t h a t t h e customersdid not trust the method, it was also alleged that a

slight amount of gold was always lost while

testing. The customers had to accept this for

want of an al ternative. In19 99 , Ta ni sh q

i n t r o d u c e d t h e r e v o l u t i o n a r y c o n c e p t


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o f caratmeters in its retail boutiques. The caratmeter

used X-rays to give an accurate reading of the

constitution of gold in the ornament within three

minutes. Imported from Germany a t a c o s t o f

R s 1 m i l l i o n e a c h , c a r a t m e t e r st h o u g h expensive, proved to be the biggest USP

for Tanishq in the coming years.

Fact, its sales increased by 20-30%. The conceptwas later on h eralded as a bold s tep to wards

professional iz ing the I n d i a n j e w e l l e r yb u s i n e s s . I n a n a t t e m p t t o e l b o w o u t

competition, Tanishq conducted tests on 10,000

ornaments selected at random. In some cases thecaratage was found to be as low as 10% and almost65% of the gold tested was below 22 cara ts. As the

caratage offered was on the lower s ide int radi t ional jewels , the jewel lers kept the

making charges very low to entice customers. Thishad become the norm all over the count ry.

Tanishq had to struggle hard to break thisconvention.

As the concept of caratmeter became more widelyknown, customers began to realize that the rates theywere paying for Tanishq jewellery were indeed justified.

A Tanishq official commented, "They have begun tounderstand the total value proposition that Tanishq offers."

A n a l l - I n d i a c u s t o m e r s a t i s f a c t i o n s u r v e yc o n d u c t e d b y T a n i s h q i n 2 0 0 1 r e v e a l e d

that over 50% of al l Tanishq customers

intended to make it their jeweller, replacing many long-s tanding re la t ionships wi th the t radi t ional

jeweller . When Tanishq was launched, i t so ldmost of i t s products through mul t i brand

s tores . This d id not help the Tanishq b r a n d

t o m a k e i t s m a r k . H a v i n g r e a l i z e d t h i s ,


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T a n i s h q decided to set up its own chain of retail

showrooms in 1998.

T h i s p r o v e d t o b e a v e r y w i s e m o v e a s

s a le s pi c ke d up a l m o s t i m m e d i a t e l y . B yJ u l y 2 0 0 1 , i t h a d 4 7 ' T a n i s h q b ou t iq u es '

i n 3 7 c i t i e s 1 2 w e r e i n t h e m e t r o s -D e l h i , Mumbai, Kolkata, Chennai and Bangalore, the

rest in smaller cities with a population of at least 0.5million such as Trichy, Nagpur, Amritsar and Patna.

The focus on smal ler c i t ies paid of f wel l wi th

t he annua l g r owt h be i n g a s h i gh a s 150%

a s co mp ar ed to th e 45 %growth in metros. The

number of boutiques was expected to reach 50 by

the end of 2001 and to 70 by 2002. Tanishq's

efforts to standardize the price of its ornaments proved to

be another milestone in its success.

Gold prices differed across the country as they were

based on different parameters concerning the

local markets. In a bid to control gold price

variations in different parts of the c o u n t r y,

T a n i s h q d e c i d e d t o h a v e a s t a n d a r d g o l dp r i c e across all its showrooms from March 2000.

T h e s t a n d a r d p r i c e w a s m a d e b i n d i n g

o n a l l T a n i s h q showrooms . Tani shq based

its gold prices on international exchange prices,

result ing in pri ces o ften being lower than the local

market prices. Nangia said, "We already have a kind of

s t a n d a r d p r i c i n g i n p l a c e , b u t t h i s w o u l d

r e p r e s e n t a formalization of that system to thepublic." Tanishq even had plans to link directly with

the London Metal Exchange (LME) for daily quotes in

the future. Tanishq set up an ultra-modern and large-scale

manufacturing unit in Hosur, Tamil Nadu at a cost of

Rs 600 million. The unit had facilities like


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refining, alloying and stone casting and a dust-

extraction system that kept gold losses down to 2% of

the raw material while local jewellers typically lost 8-

10%.

This in-house manufacturing facility was the main

reason, which enabled Tanishq to charge the same

price across the country. One of the company's most

important initiatives was customer service enhancement.

Tanishq launched a direct consumer contact programme

and conducted surveys to monitor store walk-ins

and foot fa lls and percentage of repeat customers.

The company also kept the entry-level price as low as Rs

600(for a pendant) and offered a range, which far

exceeded that offered by any other jeweller. All

Tanishq out le ts gave a100% return guarantee

on i ts bran d of jewe llery and also exchanged

other jewellery after deductions depending on

purity.

A customer satisfaction measurement program wasstarted w i t h t h e h e l p o f C u s t o m e r

S a t i s f a c t i o n M e a s u r e m e n t Management

(CSMM), an associate of IMRB. CSMM tracked

customer satisfaction parameters for Tanishq on a

quarterly basis. This gave the company the

benefit of bench marking agains t local and

internat ional p layers and a lso a ided in

improving repeat purchases. As a result, Tanishq was

able to directly link the remuneration of franchisees

with customer sa ti sfa cti on . T he co mpa ny 's

co rpo rat e go ld gi ft sc he me('When you want to

say thank you, say it in gold'), launched in

December 1998 proved to be a major success.


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Tanishq de l i v e r ed 50 ,00 0 c us t o mi zed go l d

c o i n s t o 0 . 2 5 mi l l i o n Maruti car owners

nationwide as part of the 15th anniversary

c e l e b r a t i o n s o f M a r u t i U d y o g . B y

2 0 0 1 , t h e s c h e m e a c c ou n t ed f o r a l m o s t5 % o f t h e t u r n o v e r a n d o v e r 3 0 corporate

clients like Coca-Cola, the UB Group, Whirlpool,

the TVS Group, Ceat and Liberty Shoes.

The communication and promotion

budget was increased from Rs. 65 million in 1999-

2000 to Rs 100 million in 2000-01. A majority of

this was spent towards advertising, while apportion

was also earmarked for promotions tailored to match

regional preferences. For instance, in New Delhi,

which was Tanishq's single largest market, substantial

promotions were carr i ed out . The Rs 100 mi l l ion

was split into four parts, comprising national-

level spends (both electronic and print media),

regional budgets, direct mail and research. For the

first time, Tanishq initiated a long-term media plan,

aiming to g i ve th e br an d a ro un d- t he -y ea r p r e s e n c e a n d e n h a n c e a wa r e n e s s . T h e

c o m m u n i c at i o n f o c u s e d o n d e s i g n a n d

quality instead of the price.


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HOW DID TANISHQ TURN AROUND?Jacob Kurian, chief operating officer (jewellery),Tanishq isn't tired of saying that the story of his company

mirrors a Bollywood movie.

There's drama, celebration, then betrayal in the family,followed by action and, of course, a happy

ending.Tanishq, the jewellery business group of Titan

Industries is the blockbuster action thriller from the Tatagroup.

After five years of consistent losses, the company, onThursday, announced the completion of a dramatic three-

year turnaround culminating in annual sales growth of 39per cent and profit growth of 318 per cent.During 2002-03, Tanishq recorded a sales turnover of Rs 389 crore (Rs

3.89 billion) -- at consumer prices. By 2007, it hopes totake that to Rs 800 crore (Rs 8 billion)

Today, Tanishq has already become one of the top five

retailers in the country. It contributes 40 per cent to

Titan's business and is expected to account for 55 per

cent by 2007.By then, Tanishq's profitability will also begood enough to offer 28 per cent return on deployment of25 per cent of the capital.

Year Sales (Rs crore)

1996-97 32

1997-98 38

1998-99 731999-2000 141

2000-01 188

2001-02 299

2002-03 389
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It's a long way for a company that almost folded up

before it could turn in its first ever profit. Since, itslaunch, Tanishq has not only been grappling thetough market conditions but also internal strife andDoubting Thomases.

"Many people believe we should not be here today.They have kept telling us that the business logic is

against what we set out to do. But I am glad we haveproved them wrong," says Kurian proudly.

The estimated Rs 40,000 crore (Rs 400 billion) goldjewellery market in India is a rough one. There areover 300,000 jewellers, each powerful in hisneighborhood.

Till the last two years, national players were almostnon-existent.

One of the largest consumers of gold, the Indian

household had a marked preference for 22-karat gold,

as opposed to the 18-karat designs that jewellerychains worldwide chose to do their designs in.

Not surprisingly, the skeptics were asking what wasTitan doing in the jewellery business?

In the late eighties, when India was facing a massive

foreign exchange crisis, Titan, the watches division,was told to look for a way to earn its own foreign

exchange.

Jewellery seemed like a huge and interesting market

to get into and Titan decided to set up Tanishq as a

jewellery division that would be focused largely onexports.


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However, by the time it acquired the skills and set up

the plant, the world had changed. India no longer hada foreign currency problem, imports were easy to

come by, demand had come down in the global

market, supply had grown in Asia and margins hadbecome very thin.

Tanishq then decided to focus on the Indian market.

In August 1992 a pilot plant was set up andproduction started in two years later. In 1996,

Tanshiq launched its first store. It was a hitherto

untried concept. The jewellery business in India washighly fragmented and ruled over by local players.

There was no national jeweler that people could buy

from, despite that India is the largest consumer ofgold in the world.

Clearly, the local satraps had a very tight stranglehold

on their markets and it was difficult for a pan-Indianplayer to break into. Being ethical too was a problem.

Titan estimates that up customers and theGovernment is defrauded of up to Rs 5,000 crore (Rs

50 billion) annually due to unethical business

practices like under-karatage of gold,

misrepresentation of quality and tax evasion.

As a company which was part of the Tata group,known for maintaining high ethical standards,

Tanishq prided itself on delivering customer valuethrough a fair and transparent business model.

But that wouldn't help.

Till 2000, Tanishq could not find its feet in themarket and its losses were mounting. In 1998-99 it

showed losses of Rs 10.40 crore (Rs 104 million)though sales turnover was increasing.

May 2000 turned out to be the defining period in the

company's history.The then managing director of thecompany, Xerxes Desai had a choice between


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Bhaskar Bhat and Vasant Nangia when it came todeciding who would succeed him.

Bhat won and was anointed as the next managingdirector by Desai himself and Nangia became thechief operating officer.

Nangia was the hands-on man at Tanishq. A twenty-year veteran of the group, he was the one who hadcharted out the expansion plans, which included

increasing the number of exclusive boutiques to 67

from the then 30 and launching a new men's range ofaccessories.

But a day after Bhat was announced at the successorto Desai, Nangia quit. He took along with him sixsenior executives of Titan. It was a blow that manythought would sink the company.

"The entire sales and marketing team resigned on thatday. The company was rocked by what happened.

Many thought this would be finally the way Titanclosed down its jewellery business. After all, we were

in our fifth consecutive year of losses then," says

Kurian.It seemed an ignominious way for a Tatacompany to go. And like Kurian says it was too soonfor the movie to end.

So, a new and admittedly inexperienced team was puttogether. The team had an onerous task on its

shoulders. It had to not only stem the increasinglosses shown by Tanishq and but also show some

profits if the company was to remain in business.

Tanishq had quite a few problems on its hands then.Its high decibel media advertising wasn't working. Astream of adverse media reports had instilled the fear

that its shareholders would pull out anytime. Andworse, it had very little time on its hands to show aturnaround.


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But as Kurian saw it, Tanishq's woes were rather

simple: There were just not enough customers in itsstores."For a retailing chain, that's the worst thing that

can happen: having no traffic in the stores," saysKurian.

A customer survey revealed multiple problems.

Despite its high-blitz ad campaign, many didn't know

what Tanishq was about, others found it tooexpensive and some felt that the product was not forpeople like them.

Either way, getting customers back into the storebecame a priority.

PROFITS GENERATED

Ku

r

i

an

Kurian and his team then decided to launch the fifthanniversary celebrations of Tanishq that would offer

discounts to customers and induce them to come tothe store.

Year Profits generated (Rs crore)

1996-97 - 10.60

1997-98 - 21.96

1998-99 - 10.40

2000-01 2.07

2001-02 1.87

2002-03 7.82


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The ploy worked. "We had customers waiting for the

store to open. Sometimes we had to call the securityguards because of the crowds. We just couldn'tbelieve it," smiles Kurian.

There were other minor tweaks made too. Adcampaigns now started to list out the products thatTanishq had. So bracelets, rings, chains, pendants

were explicitly mentioned in each ad. A range

starting at Rs 399 was launched.The aim was to bringdown the price barrier significantly. Collections for

the working women and a new set of contemporary

designs were brought into the stores.

Almost all of the efforts paid off. A year later,

Tanishq had made its first ever profit in the entireexistence of the company. It was a measly sum of

around Rs 2 crore (Rs 20 million), yet it was a

beginning.The next year, the company decided towrite off some of the financial baggage it had beencarrying. Profits generated dipped as a result but

Tanishq was clearly on a revival.

The company changed quite a few of its original

strategies along the way. Tanishq had its firstshowroom in Chennai in 1996. Today it has over 60showrooms in 47 cities. Only six of these are ownedby the company. The rest are run by franchisees.

The model has helped take away capital costs from

the company and pass them on to franchisees who

will invest money to help the company grow. In all,Tanishq managed to limit its fixed asset investment toRs 27 crore (Rs 270 million).


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Contribution to Titan's growth

Year Tanshiq contribution to Titan (in percent)

1996-97 8

1997-98 14

1999-2000 24

2002-03 43

Post September 11 attack on the World Trade Centerthe volatility in the gold prices led to a steep decline

in the demand for gold. In 2002, the gold demanddeclined by 19 per cent, from 843 tons to 680 tons.

However, Tanishq was on a roll. It grew its retail

sales during 2002-03 to Rs 332 crore (Rs 3.32 billion)from Rs 239 crore (Rs 2.39 billion).Almost Rs 57

crore (Rs 570 million) came through corporate salesand exports. Corporate and institutional sales had

become an unexpected money-spinner for thejewellers.

Today, Tanishq counts companies like Hindustan

Lever Limited, Pfizer National Panasonic, UB Group,Tata Tea and Tata Chemicals among its clients."We

saw corporate sales as a new route to customeracquisition. Institutional sales help us beat targets,"says Kurian.


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CONCLUSION WITH THE

QUESTION OF GLOBALISATION

An Indian Brand, which can make big in the globalmarket, is Tanishq from Tata Group of Industries.

Tanishq is India's largest, most desirable and fastest

growing jewellery brand in India. Tanishq today is

India's most inspirational fine jewellery brand with an

exquisite range of gold jewellery studded with diamonds

or colored gems and a wide range of equally spectacular

jewellery in 22Kt pure gold. Exquisite platinum jewellery

and designer silverware is also part of the product range.Now the question arises why Tanishq will make a greatGlobal Brand.

CONSISTENCY IN DELIVERINGON THEIR PROMISE:Tanishq promises superior quality jewellery with purity

in gold. They claim and deliver the exact carats and

weight that they promise. Impurity in gold and notdelivering what was promised is one of the mainproblems the consumers face when going for gold

purchase. Tanishq eliminated this and has built its brandin trust. Tanishq now stands for quality and purity. They

even have gold meters where one can check the purity ofgold.

It is first and only jeweller who guarantees the purity ofits gold jewellery and certifies the quality of its diamonds

and colored gems in writing. Thus it has established itselfas a highly ethical player in a market that was rated as

having the highest incidence of under karatage (Bureauof Indian Standards).


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SUPERIOR PRODUCTS ANDPROCESSESWidely acknowledged as a design leader, Tanishq is

known for its ability to develop specialized designcollections. Tanishq is the only jeweller that houses afull-fledged design studio with a team of several

international award winning Indian designers. Tanishqwas recently adjudged the Most Admired Jewellery brand

(for the third consecutive time) in India at the ImagesFashion awards 2004. It has also been judged as the

Images Retailer of Year in the fashion category.

Tanishq jewellery is crafted in one of the world's mostmodern factories. The factory complies with all labor and

environmental standards. Located at Hosur, Tamil Nadu,the 1, 35,000 sq. ft. factory is equipped with the latest

and most modern machinery and equipment. Every

product at Tanishq is painstakingly crafted to perfection.

Diligent care and quality processes ensure that theTanishq finish is unmatched by any other jeweller in thecountry.

Distinctive positioning and customer experience. Yet

another aspect of Tanishq that sets it apart is a whole newjewellery buying experience offered by its exclusive

retail showrooms. Tanishq has not only developed anational retail chain with uniform and transparent

practices and policies but also maintained consistency ofretailing standards across all these showrooms on anongoing basis.


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It has a distinctive positioning in India as it is known for

its high quality and jewellery with internationalstandards. Also, since they have many stores across the

country they give guarantee on their jewellery and also

offer to repair it free of cost anywhere across the country.

AN ABILITY TOP STAY RELEVANTTanishq was established in 1995 and within ten years it

has become the largest and most desirable brand in thejewellery segment in India. They have constantly

introduced new offering to their consumers and havecome up with new innovative ideas. They have excellent

after sales service and they have been committed inproviding good and honest service.

A COMPELLING IDEA:The idea of having branded jewellery was a totallyunique idea. Coupled with a promise of purity and a

unique experience was very compelling. It persuaded alot of people especially the people in the metros and semi

metros to leave their traditional jewelers and go forTanishq.

There was always lack of trust among the consumers for

their jewelers. Tanishq removed that with a promise ofpurity. Hence what it did in India it can replicate across

the globe. Offer a totally new perspective to Jewellerybuying especially when it comes to exquisite oriental

jewellery. Oriental Jewellery across the world is usuallyfound in flea markets or place like China Town or Indian

Markets. Going into the main markets in the Westernworld will give Tanishq the edge.


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A RESOLUTE CORE PURPOSE ANDSUPPORTING VALUES:Tanishq maintains its quality standards in all its productswherever they are sold. This shows that they have a

resolute core purpose. This is what they will have tomaintain even when they global. They have the right

range of products for the different markets across theglobe. Only they have to remember their differentiating

factor. The differentiating factor for Tanishq will be the

experience and quality they will be giving the consumerwhen s/he comes to the store.

A CENTRAL ORGANISATIONALPRINCIPLE:Tanishq has to translate what its brand signifies to the

whole of their organizations. They have done thatexceptionally well in the Indian context. A visit to anyTanishq outlet shows that. The people behind the counter

are polite and courteous. They know that they are there todeliver the promised exceptional services. The people at

Tanishq know what is required of them and hence thiswill prove beneficial when Tanishq goes global to

maintain its global standards.

Tanishq, as and when it decides to go global will make agreat global brand. As we can see they have all the

characteristics, which all the global brands have, it can besaid that Tanishq has all the potential to become aleading global brand.


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BIBLOGRAPHYwww.rediff/business.comwww.tanishq.co.inwww.wikipedia/tanishq.comwww.google.com

OTHER SOURCES:-NewspaperBusiness magazines.
http://www.rediff/business.comhttp://www.rediff/business.comhttp://www.tanishq.co.in/http://www.wikipedia/tanishq.comhttp://www.wikipedia/tanishq.comhttp://www.google.com/http://www.google.com/http://www.google.com/http://www.wikipedia/tanishq.comhttp://www.tanishq.co.in/http://www.rediff/business.com


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INDEX / CONTENTS1.Introduction about Tanishq2.Launching of Tanishq3.Product4.Recent development5.Promotion6.Price value7.Tanishq in India8.Tanishqs competitors in India9.Tanishqs market research andsurvey10. Turnaround story11. How did tanishq turnaround12. Conclusion with Globalization

Final Tanishq marketing strategy

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