Jewellers in Mahabalipuram : ( Shop owner – Raju Jain ) 
by Viral Patel - FT13195
Why study Jewellers?
Gold forms an important part of Indian Family. It is used for jewellery, investing, gifting options, as good omen on important days during year based on family financial strength.

Buying decisions are generally made by entire family including male, female, children, and elderly members of the family. A single purchase runs in a couple of ten thousands to lakhs hence factors associated with buying decisions are complex. Also after the first survey I wanted to speak to people whom I can interact without having a translator.

Market Place Demographics and Composition:

Sellers:

There are about 10-12 shops in Mahabalipuramselling gold and silver jewellery in the area. Of which 6-8 are operated by Marwari Community from Rajasthan. Other 4-5 shops are operated by people belonging to Tamil Nadu. They are there since 2-3 generation in the area and stay with their family. Elder generation moves back to Rajasthan. There is a lot of information sharing amongst Jewellers.

Buyers:

Predominantly people living in villages around Mahabalipuram. Mahabalipuram has population of around 5000- 10000 people which also form a part of customers base but not huge. Tourists hardly buy any jewellery from Mahabalipuram. They mainly buy it from Chennai. Customers generally buy on marriage occasions. The falgun month is where the sale is almost nil since no marriages take place. Customers generally have their jeweller fixed since long as it involves trust. However, for better design they would opt to buy from city rather than buying from other jewellers in Mahabalipuram.

Source of Goods:

There is no jewellery making (manufacturing) unit in Mahabalipuram. There are manufactured mostly in Chennai or Coimbatore. The individual jeweller has its tie up with jeweller making units in Chennai/Coimbatore. The jeweller sources gold from Chennai and diamonds and other stones from Chennai or Coimbatore.

Customer Preferences and decision making factors:

Design:

Customer is aware about design as viewed in social functions and in television. Also the availability of design with jeweller plays an important role in customer retention. Hence they keep their catalogue updated regularly. In house they have 4-5 design for each product group (earrings, chain, rings etc…). Most of the jewellery sold around 70% is from in-house design. Customers value touch and feel of the design and how it looks on them. People who might buy jewellery regularly would opt for designs from catalogue. The shops are generally well lit as is required in industry and neatly laid out. However, they generally don’t have Air Conditioning. The shop design and architecture has almost no bearing in purchase decision.

Quality:

The quality in jewellery is determined by the purity of gold. Purity of gold is measured in terms of carats. 24 carat is highest and 8 carat is one of the lowest. Customers generally buy 22 carat jewellery. Customers are aware about the third party quality standards and many customers do ask for Hallmark certified jewellery. However most customers still do not insist on VATable invoices. Since customers are buying from these jewellers from a long time they have faith on jewellers.

Customer buying habits:

The regular customer when he generally comes for buying the jeweller buying in the first visit. On few occasions, customers would check out designs at other places or incase of budget constraint would postpone the buying decision.

Other Business avenues and value proposition for customers:

Mortgages:

Customer keep jeweller on mortgage and have gold loans against the same. The rate is 2% per month based on assessable value of gold (excluding making charges and weight of stones, diamonds). Generally 98% customers are able to come back with the principal and interest amount and take back jewellery.

Gold Biscuits/Bars

The jewellers are now prohibited (by Government of India) to sell gold biscuits/bars. They can sell only coins. These coins customers generally prefer to buy it from bank. Government has regulated selling of gold biscuits/bars and even jewellers for making jewellery buy bars/biscuit from them.

Resale

Gold jewellery reselling is not a big market. People don’t come to sell jewellery unless there is an emergency. Also they don’t use old jewellery for recycling and making new jewellery.

Viral Patel - FT13195