Metals and Minerals Trading Corporation (MMTC), a government of India enterprise did a roaring business for gold and silver coins this Dhanteras through the online channel, bought as gifts
Buying fine jewellery remains a touch and feel driven experience in the Indian market, a gap which has been shortened by online-only jewellery brands. This festive season had major marketplaces such as Amazon, Snapdeal and Flipkart digging for gold-buyers through new tie-ups and products on their platform, in the hope of breaking the barrier. “In the US, what drove the online jewellery market was low-value, artificial jewellery. The sales were driven by holiday-seasons and gifting. Similarly, in India, the online jewellery buying will be driven by low-ticket sizes of Rs 900 to Rs 2,500,” says Santosh Anoo, Senior Director at Deloitte.
Despite offering category-specific discounts ranging from 10-15%, the fine or precious jewellery space is a high margin business for the horizontal marketplaces. Tie up with the large marketplaces works in favour of online players such as Bluestone and Caratlane to reach a wider audience, creating an alternate stream of revenue.
The number of buyers increased five-times during Dhanteras. The revenue growth was 8X, indicating that people were buying higher value jewellery and majority of the sales came from our existing customer base on the marketplace,” says Rahul Taneja, VP of category management at Snapdeal.
“With gifting season kicking in, our sales of both artificial and precious jewellery have seen a significant growth from Big Billion Days to the period leading to Dhanteras,” said a Flipkart spokesperson.
The platform has tied up with multiple offline players as well as online players such as Bluestone, Caratlane and online marketplace, Velvetcase. While the sales contributed from the channel is low, online-first jewellery brands are turning this into an opportunity through differentiated offerings. “The volumes we are doing on the marketplace are only 1 to 2% of the overall sales. However, the horizontal marketplaces have a bigger footprint,” says Gaurav Singh Kushwaha, founder and CEO of Blueststone which raised Rs 100 crore earlier this year led by Accel Partners.
“We have a separate catalogue for the large marketplaces and create a lot of exclusive products such as silver jewellery for retail through this channel, suited to the price point,” says Calvin John, VP of offline marketing at Caratlane.
“There is also a clear push for consolidation in the market,” said Kapil Hetamsaria, founder and CEO of Velvetcase though he refused to elaborate further.
The online designer brand had pivoted to a marketplace model in June this year, showcasing international and Indian designers as well as jewellery houses on its portal. In order to ensure safe delivery and customer experience, logistics has been a challenge for online jewellery retailers.
We rely on the marketplace’s logistics to ship the orders generated through their channel while we process and fulfil orders on the Velvetcase marketplace separately due to high ticket-size,” says Hetamsaria. However, Snapdeal relies on its network of specialised partners for all deliveries in the precious jewellery category to control the supply chain, considering the average ticket price in gold jewellery can hover around Rs 17,000 for peak seasonsRs
Source: The Economic Times