People in small towns and rural areas are likely to contribute more to the jewelry business in the country as they purchase more ornaments compared to people living in the metros
The jewellery business in India is an ever-glittering industry. It showcases a huge potential for growth and plays a pivotal role in the Indian economy. The Indian jewellery industry is expected to reach US$ 100 billion by 2025.
However, it is a common misconception that residents of metros have access to, and interest in, jewellery labels. According to experts, the People in small towns and rural areas are likely to contribute more to the jewellery business in the country as they purchase more ornaments compared to people living in the metros.
There is huge marketing waiting in small towns for big players to tap in. The potential of tier II and tier III towns is proving an irresistible lure for both, big, established players like Tanishq and Gitanjali Jewels.
The jewellery brand of Titan Company, Tanishq, is planning to expand its footprints across tier-II and tier-III cities. The Tata group firm is eyeing to open more than 200 outlets in at least 130 new small towns in next 5 years.
Why Tier-II and Tier-III
As compared to metro cities, jewellery sales are expected to grow in small town cities. In rural areas, people are buying jewellery as a means of investment and also for marriage purposes. However, in the metro cities, people are holding back their money waiting for the prices to go down.
C K Venkataraman, Titan CEO (jewellery), said, “Unlike many other businesses, which make less profit from smaller cities compared to the bigger ones owing to sagging demands, jewellery is bought by every category of people across all places.”
Taking the Franchise Route
Tanishq is taking the franchise route to establish its presence across the country. Tanishq retail chain currently has 275 exclusive boutique stores in 170 cities. Out of that 226 are the franchise and 50 outlets are company-owned. Setting up a Tanishq shop in a small town cost around Rs 15-20 Crore, while a big-format outlet Rs 40-50 Crore.