Branded diamonds are a girl's best friends  ( May '9,2003, ET)

Branded diamond jewellery sales have risen by 20% for the year ended December '02, against a growth of under 5% in ’00. The diamond trading corporation (DTC) plans to rope in diamond merchants to advertise and market their lines and to create awareness for branded jewellery.

The segment is still in its nascent stage compared to unbranded diamonds, which dominate the market.

Diamond merchants, who are part of DTC, need not be manufacturers of diamond-studded jewellery, but continue to spend on advertising and marketing expenses to promote branded jewellery in India.

According to DTC, internationally, advertising and marketing costs of manufacturers of luxury goods such as watches and perfumes account for 11% of total sales. Against this, advertising and marketing expenses for diamond merchants in India are less than 1% of sales.

“There is a huge void here which needs to be addressed, says Devika Gidwani, director, Diamond Information Centre. According to DTC, there is room for more brands as branded diamond jewellery accounts for only 10% of total diamond sales in India.

Explaining the mechanism of the diamond chain in India, Ms Gidwani says the DTC created brands such as Nakshatra (traditional jewellery), Asmi (low-priced jewellery) and Arisia (premium jewellery).

The products are endorsed, branded and promoted by DTC. Diamond merchants select the brand they want to support, and supply the diamonds (suitable to the brand) into the retail market.

Traders also offer incentives to the retailers for meeting targets and boosting sales. Diamond merchants get retailers into the net to support DTC’s advertising and marketing efforts. This is how the chain builds up and a brand is created.

Of all the brands, Nakshatra, has been rated as the most successful in the Indian market. “The market for branded jewellery has seen a reversal in fortunes after the brand was introduced. It is endorsed by DTC, so customers value the quality as well as the price attached to it,” said Ms Gidwani.

DTC has plans to consolidate its brands, Arisia and Asmi, along with Nakshatra and also make room for new brands.