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The Rediff Business Special/Shobha Warrier

New Millennium mindset hammers jewellery retail market into shape

In this age of marketing and advertising overkill, anything can be hard-sold anywhere: sand in the Sahara, ice in the Himalayas, junk bonds in the US and gold in India. Right? "Not quite. But, well, sometimes, it becomes necessary," says Venkatesh, a gold retailer in Madras.

Necessary? "Yes. Agreed, from time immemorial, gold and the Indian civilisation have had an inextricable relationship. Gold has always been part of the Indian civilisation. It's a global-scale industry too. One has to keep pace with the changing times and trends," he says.

Housewife Radha sure does that. Like most Indian women, she loves gold. She also loves to hire the services of a local goldsmith, her family's trusted merchant for decades, to ensure that her old jewellery always sports the latest designs. She never felt the need to visit any jewellery shop: the good old goldsmith would come home, display a few designs, discuss with the womenfolk and then agree to execute their new orders .

Recently, Radha accompanied one of her friends to a swank jewellery shop in Madras. The sprawling, glitzy, tastefully illumined, air-conditioned interiors captured her imagination. "The ambience was marvellous, the wide variety mind-bending. The sales people were helpful. But then, you buy gold on the basis of trust. And I trust only our family goldsmith."

So off she went home, sent for the goldsmith and gave him a piece of her mind. "I shared my impressions of the showroom and urged him to update his knowledge of jewellery designs, do up his shop and employ shop managers. I also hinted that it is time he should improve his attitude towards his customers."

According to Radha, the family goldsmith takes his customers for granted. "A day will soon some when many of his customers like me may shift loyalties," she says.

That warning is not lost upon the traditional gold retailers in India who are fast shaping up. What was basically a family business is undergoing a transformation. For, it seems, anyone and everyone who is interested in starting a new business is looking at gold as a very lucrative proposition!

What characterises the new entrants is their aggressive approach to sales and management. Some of these New Millennium jewellery outlets recently sought the help and guidance of the World Gold Council to entice the old-timers.

A WGC survey revealed that most of the buyers of jewellery were dissatisfied with the service they receive in traditional shops. The survey concluded that specialised skills are imperative for selling gold in - hold your breath -- India. Yes, India, where gold-lovers abound, where old-time retailers believe the demand for the precious commodity outstrips the supply, thus obviating the need for any special efforts for sales.

The latest statistics have it that India, a developing country, is the world's largest consumer of gold! The perception is that gold makes for the safest and most profitable long-term investment. The US market is the second largest. So much so that industry analysts expect the purchasing power of Indians would increase in the next few years, triggering unprecedented demand for gold.

The WGC hopes to equip gold retailers with necessary shop skills to ride the expected boom. "Till now, jewellers relied on their kith and kin to man their shops. But with increasing competition and consumer awareness, the shops are forced to update themselves. Jewellery firms want to train their staff to handle even the most difficult customers. After several studies, we have developed a course for retailers," says Sivaram, the WGC's manager (south).

The council has tied up with NIS Sparta, a sales and management training organisation, to impart training in gold retailing, a first of its kind exercise in India. Ramanathan, NIS Sparta's regional head in Madras, says leading jewellery shops have been expressing the need for trained youngsters to supervise the shop-floors. "They are willing to spend big money."

NIS issued advertisements in the local press seeking applications for the positions of "hostesses". Within a few days, their office was flooded with applications. Male applicants outnumbered women aspirants! "It's a pointer to the youth's positive attitude to gold retailing. They have recognised that gold business is going get bigger in India."

The first part of the six-month, Rs 8,000 course teaches the finer aspects in selling; the second half focuses on the technical aspects of gold.

Pandian Palaniappan, one of the faculty members, says, "In today's scenario, you need expertise to sell anything because customers are more demanding. Due to competition, no shop wants to miss out on any of their customers."

Agrees Anand, a member of a family that runs a "traditional" jewellery shop. He is one of those who enrolled for the course. "Even now, we follow a very traditional approach in selling and marketing. But the consumer behavior has changed dramatically. They have become very demanding and knowledgeable. It is essential for us retailers to prepare ourselves to meet their demands."

It is not just in metros that people have developed a new taste for jewellery. Kamakshi Selvi's husband owns a jewellery shop in the suburbs of Madras. The couple has business expansion plans. "Merely because our business is not city-based, we cannot sit back and wait for the customer to step in to our shop. Even in small-time places, people are aware of the latest developments. We have to be on our toes," she says.

Sudhan runs a jewellery shop in Nagappattanam but visits Madras every week to attend the classes. "Unlike in the past when most of the customers were ignorant, things are different now. Selling gold is no longer easy. You need skills to do that," he says.

"So, do you agree that when necessary, sand can be sold in the Sahara if you have the right skills?" asks Venkatesh, smiling, brushing an imaginary dust particle off a trendy diamond-studded ring.

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