Most Recent Articles In Designer and Luxury
Latest Designer and Luxury Articles
More Articles By
Designer bags, belts and shoes have already caught on in India, but European jewelry is another story.
There were many hurdles even before last month’s terrorists attacks in Mumbai that killed more than 160 people. Challenged by the country’s steep custom duty, hefty sales tax and a limited retail infrastructure centered on malls and fancy hotels, Western fine jewelry brands are only just beginning to make inroads into the world’s second most populous nation.
Despite a sharp rise in the number of high-net-worth individuals in India — a 22.7 percent increase in 2007, according to the latest annual wealth report issued by Merrill Lynch and Capgemini — the country’s own Place Vendôme is potentially decades away, experts said.
“India could become what China is for us today — we’re number one there, with 29 stores by the end of the year — but otherwise locally there’s not much to do until they change the tax situation,” said Bernard Fornas, chief executive officer of Cartier International.
Cartier opened its first store in India last month, in Delhi’s new luxury Emporio mall, feted by the release of a limited edition Santos 100 timepiece that features a glittering Taj Mahal motif on its dial. But for the time being, Cartier’s retail development for jewelry in India stops there.
“There’s a lot of money there and they know more about jewelry than any other emerging country,” Fornas said. “They love it and produce it, but we’ll have to wait until all the ingredients that are holding us back change.”
In the meantime, the brand has been mounting marketing events in India. These have included The Cartier Alternative Elephant Polo Cup, held in Jaipur two years ago and attended by the likes of Jacquetta Wheeler, Olivier Martinez, Her Highness Maharani of Jaipur Padmini Devi and Bollywood star Preity Zinta. Last month, in tandem with its opening at Emporio, Cartier organized the “Travel with Style Concours” at the Royal Western India Turf Club in Mumbai, featuring rare heritage automobiles that belonged to Indian royalty. Pink Floyd’s Nick Mason and cricket legend Imran Khan were among those judging the cars.
When entering emerging markets “the way I see it, and the same was true for Russia and China, is that there is a kind of learning process where locals start with ready-to-wear then bags and shoes, followed by watches and eventually jewelry,” said Albert Bensoussan, director of watches and jewelry for Louis Vuitton, which sells jewelry in two of its four stores in India, based in New Delhi and Mumbai.
Vuitton’s location in the Taj Mahal Palace was closed after the terrorist siege and a temporary location is slated to open in its place.
Eager to cultivate relationships with Indian clients on their home ground — the majority of luxury purchases by Indians are made when they are traveling — Vuitton has chosen to absorb sales taxes on high value product.
“One of the ways for us to go beyond tax is to have the same worldwide price on a piece no matter where you buy it,” said Bensoussan. He added that purchases by Indians now represent about 5 percent of Louis Vuitton’s global sales, but the next 10 years should see the country vault to the fourth or fifth biggest market for the brand.
As one of the world’s biggest jewelry markets, the sparse representation of Western players in India is something of a paradox, especially considering the voracious appetite displayed by the maharajas for Place Vendôme’s artisans in the early 20th century.
“Jewelry was central to the status and identity of India’s rulers,” said Anna Jackson, curator of the Victoria & Albert Museum’s upcoming exhibition “Maharaja: The Splendour of India’s Royal Courts” that will open next October. “The king’s power was articulated through the way he presented himself, and because jewelry was such an important part of their lives, they were fascinated with Western jewelry.”
The show will feature the Patiala necklace commissioned by the Maharaja Bhupinder Singh of Patiala from Cartier in 1928, which originally carried a 234.69-carat cushion-cut pale yellow De Beers diamond.
While Chaumet, Van Cleef & Arpels, Boucheron and Harry Winston, among other houses, have shared fruitful relationships with the country’s royalty, the presence of such brands in India today, more than half a century since demise of the British Raj, is relatively insignificant, with many brands convinced that it is premature to establish a retail network in the country.
Boucheron, which owns three stores each in Russia, China and the Middle East, is not yet distributed in India, for example, while Chanel, which since 2005 has opened jewelry stores in Dubai, Moscow and Shanghai, with openings planned for Dubai, Bahrain and Ekaterinburg over the next year, has not started to distribute jewelry in India.
By year’s end, Tiffany & Co. will open its first store in the country, also in Delhi’s Emporio mall. It will be operated by the brand’s Indian distributor, Tarz LifeStyle India Ltd. By comparison, the brand operates 17 Tiffany & Co. stores in Mainland China, Hong Kong and Macau, as well as a growing retail network in Russia that includes 10 outlets in department stores and four freestanding Tiffany & Co. boutiques, operated by Russian luxury retail distributor Mercury. There are also 22 locations, including five in-store shops in the Middle East.
According to a spokeswoman, Dior’s fine jewelry arm also has “exciting projects” for India, though no further details were disclosed.
Aside from taxes, Western brands entering the market have to contend with the country’s formidable jewelry tradition, nourished principally by the wedding industry, with local competition forking into major mass market jewelry giants and traditional craftsmen, many of whom are based at Jaipur’s prestigious Gem Palace. The Indian public’s knowledge of jewelry and keen sense of the intrinsic value of gold and gems, still considered as a security, further contributes to a wariness of branded creations.
“Precious stones are integral to India’s wealth. Before mining began in South Africa, all of the world’s diamonds came from India,” said the V&A’s Jackson, adding that, as opposed to Western cuts that focus on sparkle, India’s traditional flat-cut gems accentuate the flawless quality of a stone.
“When the Kohinoor diamond was brought to Britain [in the 19th century] to be made part of the Crown Jewels, everyone was very disappointed as it had no sparkle,” she said.
Munnu Kasliwai, co-director of the Gem Palace, said, “Today [with Indians traveling] there is a lot of brand consciousness, but still, when it comes to buying really important [jewelry] pieces, they like to go traditional. They prefer to go to their personal jeweler for one-of-a-kind pieces.”
French jewelry designer Marie-Hélène de Taillac, who spends six months of the year living in India, said Western jewelry just isn’t impressive enough.
“You wouldn’t believe the size of stones I see worn to functions here,” she said. “[Many] think India is the new El Dorado but they’re not ready for [branded jewelry]. First of all, they know it is overpriced for what it is and it just doesn’t work with the clothing they wear. Indians are also very sharp with money. There’s old money but even those with new money spend wisely and [Indians] know the price of gold and of stones, and their number of carats.”
The sentiment was echoed by Vuitton’s Bensoussan.
“Whereas the Chinese and Russians are more status-minded, with [consumers] choosing brands with strong international recognition, Indians are more demanding in terms of the quality and identity of a product [that’s been instilled] in them for centuries,” he said.
However, Paris-based luxury consultant Concetta Lanciaux said new horizons in India for luxury Western jewelry brands may not be so far off. Ironically, one of India’s mass-market jewelry giants, Gitanjali, which has been successfully distributing a line by the Italian jewelry brand Morellato in India, could serve as a catalyst, she said.
Last month, the firm visited Paris’ Comité Colbert, a cooperative of 69 luxury French houses, to discuss possible collaborations with European jewelry brands.
“This joint venture [with Morellato] has changed the way that Indians [perceive] Western brands…and as soon as [such brands] have more visibility the government will lower taxes. It’s [an issue] that’s being discussed right now,” said Lanciaux, adding that Gitanjali is also planning to introduce an accessible luxury line. “That shows that the market is going to be ready.”