Tanishq: Positioning to Capture

the Indian Womans Heart

Prepared By:

Indias Gold Jewelry Industry

Indian gold jewelry market ~ $12 Billion Over 25000 small family owned independent jewelers. Jewelers were retail stockist. Back end of supply chain was unorganised group of karigars. Indian wedding jewelry - ~ 70% of jewelry market Wedding trousseau consisting of at least 5 pieces ~ $7500 (2008 Gold Price)where per capita income was ~ $1,089

Indias Annual Gold Consumption

The Rising Price of Gold

Titan Jewelry Watches

Failure in Europe : Underestimation of factors such as pricing pressures,high frequency of new product introductions,service at a short notice. Failure in domestic market in 1995: Prices were too high, watches appeared heavy and clunky. Consumer thinking : Tanishq was just about watches.

Move From Watches To Jewelry

Titans decision to get into studded jewelery under Tanishq faced challenges: Changing consumer perception (from 22 karat gold to 18 karat) Consumer prefernces (from plain gold to studded jewelry) From traditional to western designs

Not For Me Reaction

Boutiques resembled five star hotel lobbies: spacious, intimidating, and exclusive Limited inventory on display Designs were too western A change of pace product rather than mainstream Do I need to speak english to go in? Do I have to get dressed up?

Pioneer The Karatmeter Invoking the Tata tradition of trust and quality
TV Ads showed how a karatmeter was used Over 5000 women checked their jewelry 60 % found their pieces to be underkaratage By 2000, Tanishq hit the 100 crores mark as a brand. No. of footfalls inrease, created a level of distrust around jewelers Retail sales for 2000-01 reached Rs. 166 crores.

Conflict Over Markup

Tanishqs markup for gold: 15% to 25 % Local jewelers markup : 5% to 15% Tanishqs continued losses coupled with with losses in its international watch initiative spelled trouble for titan

Traditional system Vs. Tanishq system

Jewelers

Tanishq

Vendor or Middlemen

Head Karigars

Head Karigars

Unorganized Karigars

Unorganized Karigars

2001:Disposable income increased

Increased willingness to spend on fashion items Tanishq: Premium Indian brand targeting Modern Indian women The seven store concept : Traditional looking jewelry Tiffanys blue box to tanishq red bag

2002-2003
Launched Diva: pearls and diamonds in elegant design Lightweight gold, lightweight diamond and hoopla Collection G

Moving Towards Mainstream

Target Customer: Atleast 25 years old, college educated, a good homemaker, socially versatile, equally comfortable in both modernand traditional settings, smart spender(spend extra if given value for money)

2004-05: Brand Revaluation

Several new collections were launched Daytimes Colors Aarka Aamra

Results were spectacular: Sales exceeded target of Rs. 550 crores, reached Rs. 570 crores

2005: Gold Consumer Market Segmentation

2005-06:Going Traditional
Tanishq Paheli line : A Sellout success Competition with family jewelers who symbolized tradition Wedding designs were aggressively marketed Advertising was customized region-wise Incorporation of Tata name

The GoldPlus Proposal

In mid 2004, Tanishq team proposed to go after a segment that Tanishq was not serving This segment only wants Gold , interested in ethnic and local design, is very price conscious, lives in smaller town locations Advertising relied on girl next door Clever and personalized promotions: Quiz com petition , Engagement parties of couples held at goldplus stores In six months, Erode broke even with sales of Rs. 10 crore , Ratlam hit Rs 3 crore

Tanishq SWOT Analysis

Strengths
Capital Flexibility Innovative Modern Style Excellent & outstanding advertisement strategy

Weaknesses
Not for me Gold Purchase Rituals Gold Perceptive

Tanishq SWOT Analysis

Opportunities
TATA Support The Wedding Market Globalization

Threats
GoldPlus Local Jewelers Gold Significance Government Regulations

GoldPlus SWOT Analysis

Strengths
Marketing Strategy TATA Support Traditions & Values

Weaknesses
Limited Outlets

GoldPlus SWOT Analysis

Opportunities
Outlets The Rural Market

Threats
Tanishq Government Regualtions Design Stealers Vision of Undisciplined Boy!

Problem Analysis
Heavy Competition Failure of Gold watches Failure to tap wedding Market Not for Me perception Internal conflicts between Tanishq and Goldplus

Successful Strategies
Complete positioning Introduction of studded Jewelery Very high promotion Pioneering the Karatmeter Elimination of traditional middlemen

Graph showing the total sales of Tanishq from 1998-2007:

Recommendations
Tanishq & GoldPlus, compliment each other Understand their market territories & Characteristics Capitalize their strengths Cross Branding the market to own a larger share Going Global and teaming up with Indian entertainment products internationally