First off the block
Direct marketing has finally penetrated the highly secretive world of gems and jewellery in India. Although it has been in vogue for sometime, Dianet from Danabhai is an exclusive range of studded jewellery set in 18K gold. In an Amway type of multi-level-marketing, Danabhai hopes to cash in on and exploit the Indian middle-class dream of owning studded jewellery as well as becoming entrepreneurs without a hefty capital investment.
Direct marketing has been slightly modified for the Dianet range of jewellery. The jewellery is directly introduced by associates who have not only purchased the jewellery but also know the purchaser, thereby trying to create a bond of trust and reliability.
The mechanism
A person can become a sub-associate by purchasing Rs 15,000 worth of Dianet jewellery. Only when one purchases jewellery worth Rs 50,000 and includes two new members to the Dianet network can one qualify to being an associate. A senior associate must get business worth Rs 1 lakh and introduce two more people.
A person can become a senior silver, senior gold and senior platinum after bringing in business worth Rs 3 lakh, Rs.6 lakh and Rs.9 lakh, respectively. The jewellery is the personal asset of an associate, which he can use as samples to show potential buyers. Depending on the status, incentives range from 5 to 15 per cent for all direct business transacted by a person. Senior gold, senior silver and senior platinum receive an additional 16 to 21 per cent on all direct business.
Further, when one graduates to becoming a senior associate he receives additional incentives. Danabhai provides a warranty for every item sold and an 80 per cent buyback policy.
Setting the pace
At present, Danabhais are the only ones involved in direct marketing. But it will not be long before others join the fray. The concept looks attractive but is affordable only by the urban rich.
Moreover, like any scheme involving a network, the early birds take away the moolah. Then with Internet fast making its presence felt in the US, about $13 billion worth of jewellery was sold via the Net during 1998. In India too, as e-commerce evolves, the likes of Danabhai will face stiff competition.