The world?s greatest annual gathering of the global horological fraternity had an unexpected bling in its midst. Following in the path of other giant fashion brands such as Dior and Chanel, the world?s leading crystal brand, Swarovski, entered the world of timewear too at Basel with a splash and a modest 45 watch collection in its first year. A splash that has been two years in the making and involves innovative use of crystals and technology.
Unsurprisingly, the crystal brand is looking at emerging markets such as India to establish its market base. ?Watches have been close to the management?s heart, and this brings together two affiliated industries,? says Shirish Sanghi, Multi Brand Distribution Manager, Consumer Goods Business, Swarovski. Women?s watches are a rapidly growing segment in India, making up about 30% of its Rs 750 crore luxury watch market, informs Sanghi. Luxury, of course, implying anything above the Rs 25,000 bracket in India, also the starting price point for Swarovski in India. ?We have watches going up to Rs 77,000, but 95% are within Rs 30,000,? he hastens to add.
Which is in keeping with the brand?s target customer and brand positioning in India, unlike its rather luxury positioning internationally. Swarovski globally may be the preferred crystal supplier and maker of home decor products, but it is in fashion jewellery that its major market in India lies. Fashion jewellery, modestly priced between Rs 2,900 and Rs 50,000 makes up for 60% of the market in India and grew at 35% last year. And young women, says Sukanya Dutta Ray, Country Head, Consumer Goods Business, Swarovski, have been lapping up as ?our collections are trendy and lend themselves to the young Indians. At no time are we claiming to be fine jewellery.?
However she does point out that though these pieces may have minimal resale value, traditionally a big consideration for the Indian customer, they are guaranteed for two years. ?Growth will be in the corporate segment,? she asserts, pointing out that the need for accessorisation was moving beyond festive wear and into everyday situations and the customer has evolved to the level where the need for fashion jewellery is a given.
The home segment, which globally caters to a more luxury-end customer, in India is priced between Rs 5,000 and Rs 200,000.
The brand has already been in India for a decade through its two divisions ? Swarovski India and Crystallised-Swarovski Elements. Globally it is a 2.63 billion euro company, though sales for Swarovski India still account for a minuscule proportion of global sales ? just 4 million euros last year. Dutta Ray however points to a 25% growth last year and 30% y-o-y of the last five years and has no qualms about expansion in the downturn.
In India, Swarovski currently has 17 boutiques in 11 cities, besides retailing through a few multi brand retailers such as Shopper?s Stop. ?We are looking at tier II for expansion,? says Dutta Ray. The brand has just set up shop in Jaipur, will open in Chandigarh in September and Bhopal and Indore are also on the radar.
Swarovski also does not have the challenge of catering to differing tastes in India?s diversities. ?There is little geographical or cultural difference between the Swarovski customer in different Indian cities, in fact little through our Asia markets, even strong ones such as Japan, Greater China or Korea,? says Dutta Ray. Europe, with 40% of the global share, continues to the major market for the brand. A challenge however remains the level of awareness ? ?we are still asked the difference between diamonds and crystals? ? and the retail readiness for a number of potential destinations. Duties too remain a challenge for watches, though pricing is uniform globally.
Well, one platform the brand has been unexpectedly cut out of is the Michael Jackson?s comeback show, ?This Is It?, for which he had spent a million pounds on 3,00,000 Swarovski crystals on the set and his costumes! But given that leading celebs have been ensuring the bling quotient is visibly high for the brand at high profile events, that should just be a blip. However, whether it is able to establish itself in competitive watch market in India or not is another tale. What is clear is that for crystals, India will increasingly read Swarovski.
