Interview with Prasad Kapre CEO & Director, Style Quotient Jewellery Pvt Limited

Prasad Kapre is a well-known name in the Gems & Jewellery industry. The current portfolio that he holds is that of a CEO & Director of Style Quotient Jewellery Pvt Limited, managing Being Human Jewellery with Salman Khan.

Prasad began his career in the Gems & Jewellery industry with DeBeers in 1995. He was the first employee in the Indian team to take up the challenge of “Marketing diamonds to Indian women.” In a country which is obsessed with gold, it was truly a big opportunity for Prasad to prove his mettle. With this success, he rose to be the Business Director of DeBeers.

Over the last twenty-two years of marketing Gems & Jewellery, Prasad introduced some of the most successful brands of Indian diamond jewellery, namely, super brand Nakshatra, Asmi, Arisia, Sangini, Anant and more recently Being Human Jewellery in the mass segment. With the very first brand Nakshatra, it created a major revolution in the industry and opened diamonds as a category in the minds of Indian women.

He has a track record of innovation, clear strategic thinking, meticulous planning and a knack for building businesses and brands in tune with the future.

Armed with an MBA in marketing, Prasad has experience of over 30 years in the marketing world. His twenty two year run in the Gems & Jewellery industry demonstrates his immense loyalty and tremendous passion for the industry. The testimony to this is that he had a 3 year run as Co-Chairman FICCI, Gems & Jewellery Sector and today having completed his tenure is the executive member of FICCI. The industry has immensely benefited from his wealth of knowledge and expertise.

ET: As a member of the FICCI committee on Gems & Jewellery, please tell us what constitutes the Gems & Jewellery sector of India and what are the various drivers that will aid the growth of this segment?

PK: The Gems & Jewellery sector constitutes all the business stakeholders from mines to markets. So we have the mining companies, sightholders, cutting and polishing companies (for diamonds and other gem stones), jewellery manufacturers, wholesalers, distributors and retailers as an integral part of the sector.

Each stakeholder has their own barriers to growth or the catalyst to grow. However, one common factor to drive growth is to increase the consumption. For this, one needs to understand the motivation of a consumer to buy jewellery. As we say, no woman needs jewellery, however, every woman wants one and for this there are primarily 6 motivations to buy jewellery:

1. To enhance her beauty quotient
2. As a gift of love from the spouse to make her feel loved
3. As a self-reward for every achievement in her life
4. To fulfill a social obligation of having a piece of jewellery in her wardrobe
5. To be the center of attention at every social function
6. One-upmanship (in comparison to the women next door)

With a proper marketing campaign, keeping these inherent motivations in mind, the trade can build an emotional connect with buyers to create a demand for jewellery.

Designer & branded jewellery is seen as a lucrative segment in the Gems & Jewellery industry. What are the future trends of this industry?

The jewellery industry is perhaps the only industry where under the same roof, a consumer can find the original as well as a copy of the design. This is perhaps because every retailer has a small little workshop where a karigar employed by the retailer can copy the design and make a replica in a few hours/days.

This is one of the biggest challenges of this industry especially for the designer & branded jewellery. The trade, even today, believes in selling the jewellery as a commodity and hence sells the piece giving a break up of metal + gem stones + labour = retail price. So first of all, it is a cost plus strategy and not really value minus or charging any premiums. This is done to keep the investment angle as a driving force for the consumer to come and buy jewellery. Besides what it also means is that retail in a way has educated the consumers not to pay anything for the design. The trade forgets that design is perhaps the only reason that consumers buy jewellery at a particular showroom.

But millennials are changing the way they buy jewellery. Today, jewellery is no more an investment but is more for adornment. With this mindset, the demand for designer and branded jewellery is expected to grow exponentially.

The online jewellery retailing segment is gaining traction and may pose a challenge to the brick-and-mortar set-up. What are the challenges of the retail jewelry sector?

Online jewellery retailing, no doubt, is gaining traction but it is more at a fashion and semi-precious jewellery level. The current average ticket value has still not crossed the five figure mark and hence for gold and diamond jewellery it is still not seen as a major competition or threat.

The biggest challenge for the jewellery sector is the lack of any interest in jewellery with youngsters. They do not perceive any utility value and hence do not have much interest in jewellery. The young consumers of today would rather spend over Rs 50,000 on a good and latest mobile phone instead of spending the same amount on jewellery as it does not have any utility value for them. So the challenge is the change in the young mindsets and their aspirations for electronic products which will give them a better perceived value.

The other challenges include:

Highly volatile gold prices + heavy discount on making charges adversely impacting the industry’s operating margins
Adverse regulatory/policy measures continue to exert further pressure on thin margins
Regulatory restrictions on gold imports and gold loan schemes

Industry focused on rationalisation (closure of unprofitable stores) and selective expansion
Launch of brands focused on new-age consumer preferences such as fashion jewellery priced at less than Rs. 20,000 and focused on young, working women (e.g. Mia by Tanishq)

Players looking at opportunities in silver jewellery (e.g. Viola by Gitanjali, Saiesha Diamonds)

New category creators (e.g. Gemfields, PGI) have decided to go slow on an Indian market launch/expansion in the current environment.

How does your industry prepare design professionals & skilled craftsmen for future requirements?

The Government of India is largely investing in Skill India projects within the Gems & Jewellery sector. There are major training and Skill India centres across the country which have been assisting this industry in developing and implementing various courses to enhance the skills required in uplifting the jewellery segment.

Besides these, there are various private and other semi-government organisations like the National Institute of Fashion Design (NIFT) which imparts courses on designing and basic knowledge on jewellery processing and manufacturing.

As a strategic marketing professional, you have been associated with various jewellery brands and campaigns, including establishing the DeBeers brands in India. Can you please share with us what are the current brands you are establishing in the market?

PK: With over 22 years in jewellery marketing, I have personally grown very passionate about this industry. Given the rich heritage and culture in Gems & Jewellery, there is a huge potential for this industry to grow. There are various consumer segments both in terms of demographics and psychographics which need different kinds of jewellery. Keeping this in mind, we have introduced different brands addressing different consumers, price and product segments and reasons to buy. The four brands that we have currently introduced in the market are:

1. Silvostyle – Affordable range of silver jewellery to make a style statement
2. Links of Life – Creative concept in a bracelet for the young mindset to express their best moments of their life and flash it on their wrists
3. Tarun Tahiliani – A designer jewellery with one of a kind designer pieces in affordable silver with semi-precious stones
4. Being Human Jewellery – Jewellery with a heart. With a star persona of Salman Khan setting trends and with a charity angle which brings hope and joy in the life of the under privileged.