A shining embodiment of precision, craftsmanship and innovation, Swarovski’s awe-inducing status transcends time and borders. As the legendary Austrian brand marks its quasquicentennial, we dig deeper into its rich heritage and explore its future plans for the Indian market, including its one of a kind collaboration with a Bollywood celebrity, with Mr. Lars Schmidt, Managing Director, Swarovski Southeast Asia, and India
By: Prateeksha Guruji
Posted on: December 2, 2020
Characterized by its fine and intricate craftsmanship, Swarovski crystals’ blinding glimmer and impeccable cuts have been impressing the world since 1895 when Daniel Swarovski first founded the mythical crystal brand. With a vision to make “a diamond for everyone”, Daniel Swarovski went on to pioneer crystal making. Celebrating 125 years, Swarovski has evolved, gracefully, much like its famed logo - the beautiful and striking swan.
Mr. Lars Schmidt, Managing Director, Swarovski Southeast Asia & India
Mr. Lars Schmidt, Managing Director, Swarovski Southeast Asia, and India elaborates on his thoughts about the brand heritage. “A long rich heritage, craftsmanship and innovation are the key identity of the brand. Countless innovations have been developed since 1895 and are being developed until now. Inspired by the founder Daniel Swarovski since 1895 as his vision that “diamonds are for royalty, but I want to create diamonds for every woman”, his enduring passion for innovation and design has made it the world’s leading jewelry and accessory brand. Today, I’m grateful to play my role as part of the company with a 125 years history of delivering extraordinary products to women around the world, especially in this extraordinary region which is India & South-East Asia. Personally, I am blessed to follow our founder’s vision of a diamond for everyone, the delight that we bring to our customers through the sparkle of Swarovski is truly enriching.”
Swarovski has carved its niche internationally, but making a mark in every market is a unique challenge. From consumer behaviour, retail spaces to competition, the Indian market stands out. We further explore Swarovski’s future in retail, its exceptional brand communication in India as well as South East Asia and Mr.Schmidt’s visions for the company when it comes to market expansion in these regions.
Resonating with the consumers
Swarovski has successfully carved its niche in India where the jewelry market is largely dominated by traditional jewelers, given the culture of elaborate, ritualistic weddings that put the focus on bridal jewelry. And yet, with the rise of influencers and social media, consumer tastes have evolved over the years. Mr.Schmidt adds, “Fashion jewelry as an industry is growing rapidly. CAGR for the segment is growing faster than precious jewelry. Indian consumers are possibly down-trading. From owning a precious piece of jewelry, people have been moving to fashion jewelry that they can wear daily and changing their perception of looking at jewelry from an investment perspective.”
Swarovski, on its own, has been very mystical about its brand image. However, being innovative in its design and approach, it has also successfully understood its audiences and catered to their demands. For an international brand, Swarovski has perfectly captured India’s rich heritage and festive culture, not only in its offerings but also its brand communication. “We are very proud of our local initiatives. Even as a global brand, we have focused on Diwali since 2018 and have made it a bigger brand moment year on year. Raksha Bandhan has also been considered an important festival and therefore made into a local initiative from 2018. This year, we are extremely delighted to announce the first collaboration with Bollywood talent Bhumi Pednekar. She also had a lovely experience with Swarovski in her childhood as treasured gifts from her parents. In addition, Diwali is a time to celebrate with your loved ones, especially during these exceptionally challenging times throughout the world. The campaign is a small attempt to bring sparkle to everyone’s lives this festive season. Complementing the jewelry, this Diwali Swarovski also has gleaming, clear crystals selection, timepieces, accessories & home décor.”
Bhumi Pednekar for Swarovski
Swarovski also created an appealing and locally relevant Ramadan campaign for the Malaysian community. He adds, “We ensure the global message resonates consistently across all markets, and at the same time we value and respect the local culture. This is why the brand communication is tailored to fit the culture and people, for example we create a beautiful campaign for Ramadan in Malaysia which fits the global Swarovski aesthetic yet is respectful and relevant for the local Malaysian community.”
The Indian Landscape: Competition and COVID-19
Contributing 29% to the global jewelry consumption, the Indian jewelry and gems industry is one of the largest in the world (IBEF Indian Gems and Jewelry Report 2020). With Indian jewelers that flourish given India’s gold-loving mindset, India is a challenging market for Swarovski to conquer. Speaking about competitors, Mr.Schmidt says, “Our intention never has and never will be to compete with other jewelry brands in the Indian luxury market. Swarovski is privileged to enjoy a unique position as the leading crystal jewelry brand with a 125-year legacy that is unmatched. Newer jewelry brands actually help strengthen the overall fashion jewelry landscape but are not our direct competitors. We have an array of products, from exquisitely crafted and designed jewelry to crystal figurines and home décor pieces to Swiss-made watches with the most competitive price on the market for a Swiss-made timepiece. Additionally, in India, with many festivals and occasions throughout the year, we are top-of-mind in terms of gift-giving, especially for men.”
The luxury jewelry market has largely remained unaffected even as the world battles with the pandemic and has only recently begun to pick up its feet. However, with the economic downfall, it has been a bumpy ride for even the best in the luxury industry. “Despite the challenges the world has faced over recent months, overall development in India & Southeast Asia region in the last years show a high growth opportunity and we are confident that with the defined strategies we will be back to growth in the future. Towards the end of the year, it can be expected that the demand for goods will scale up as operations resume in full swing. Although the first half was tough, it is hoped that the last quarter will help the industry flourish. We are very optimistic for the last 3 months of 2020, especially with Swarovski’s Diwali campaign in association with Bhumi Pednekar, closely followed by Christmas. Now that the country is more in an unlocking mode, we are working to provide a safe environment to our customers in stores as well as a seamless shopping experience online,” Mr. Schmidt says.
The Retail Scenario: The Experiential and The Virtual
While the retail sector has been one of the most hard hit in the pandemic, India harbors a lot of potential for brick and mortar as well as e-commerce. Creating a balance between giving a unique store experience and a seamless online shopping experience is the key. Swarovski currently has 50 mono brand boutiques spread across the metropolises and tier 2 and 3 cities in the country. Talking about expansion plans for Swarovski in India, Mr.Schmidt says, “We have been constantly increasing investment across all customer touchpoints to create a holistic omnichannel experience as well as focus on local relevance to become a top-of-mind jewellery brand in India. Our distribution development plan is aimed at being pan India with exciting news to come soon on this front. We will continue to build consistent 360 degree marketing efforts targeting the local audience and maintain a volume business in a broad omnichannel distribution. Apart from that, we will also continue to strengthen our online initiatives and digital product marketing. We have seen constant double-digit growth in the past 20 years, and we aim to accelerate growth in the next few years and look at further expansion in the Indian market.”
The rise of e-commerce and faster delivery services has increased brand awareness and empowered people in smaller cities to purchase niche brands. As per McKinsey and Co. reports, the share of the online jewelry segment in Asia is set to double, from 6% to 12% by 2020. By 2025, 18% of the total sales made will be online, taking its worth to about $79 billion annually. This estimation suggests that Indian e-commerce would be the world’s third-largest luxury market, after China and the United States. Mr.Schmidt adds, ”The statistics are looking optimistic and COVID-19 has further pushed us to speed up in becoming omnichannel. Not only is an improved digital strategy required to boost sales in these challenging times, but mainly to serve our customers who are demanding our products while practicing safety.
We have already initiated this process, as we have strengthened our presence on third-party eCommerce platforms in India, which are Myntra & Tata Cliq Luxury with a strong product assortment which is in line with what is available at stores. Furthermore, not forgetting our pillars which are our physical stores, we are working towards developing a seamless experience to integrate the offline with the online to better serve our consumers which we will announce very soon.”
As COVID-19 restrictions took over the retail world, luxury retail has been increasingly going into customized, experiential retail stores across the world but especially in South-East Asia. Swarovski recently introduced a unique Crystal studio in Australia. Speaking about India’s future with respect to experiential stores, Mr. Schmidt commented, “India is an important market for us, we are taking some important steps to highlight this in the coming months and put focus on this market. The complete potential of India is yet to be unlocked and having said that we are most definitely looking to grow our footprint in this diverse country. For now, the new Crystal Studio concept has been introduced in very few markets to test the engagement it creates. The goal being to bring the best version of this concept when it comes to India.”
Swarovski, a brand with modern, bold designs, has spelled success in a market obsessed with traditional Indian jewelry. Its home décor products are unparalleled and seen as one of the most coveted ways to express love and attainment. It’s a winning brand, of which the Indian consumer certainly wants to see more, and will continue to follow its offerings.