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India is growing for us despite political changes & economic slowdown: Lars Schmidt, Swarovksi

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5 years ago

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Lars Schmidt, MD, Swarowski
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Lars Schmidt, the new managing director – consumer goods business for South-East Asia and India at Swarovski, visited India recently. Schmidt spoke to ET on the billion-dollar Austrian affordable luxury brand, known for its crystal jewellery and figurines, completing two decades in India and celebrating 125th year of its existence globally.

It has been about two decades since Swarovski entered India. Does India feature in the top five markets yet?
India has been a growing market for us on like-for-like basis for the last three years. We have seen double-digit growth year-on-year in this market. In Asia, India ranks very high when it comes to focus and priority. However, India is currently nowhere close to the top 5 markets namely China and US, followed by Europe, Japan and South Korea. Hong Kong and Taiwan are emerging strong too. Our top three markets in India are Delhi, Mumbai and Bengaluru. Sales from smaller cities have been surprisingly good.The jewellery category is the most important in India achieving more than two-third of the business. It has doubled in business since 2010. Watch category is multiplying by five since 2010. Home living, which is our heritage category, is growing but not at the same pace.
Gold continues to be the primary definition of jewellery in India. Swarovski is still considered artificial. How will you change this perception?
Our plan is not to compete with the precious jewellery market. We want Swarovski to be a complementary product. We see ourselves as a gift-giving brand which makes it relevant for the Indian market as it has festivals all year round, especially Diwali and Raksha Bandhan. Again, we want Swarovski as a complementary gifting product at weddings where gold dominates.
The Great Depression of the 1920s led to the growth of the Swarovski crystal industry globally. How did the ongoing economic slump in India impact your brand’s sales?

India as a market has been growing for us despite any political changes and economic slowdown. In fact, we may have grown stronger due to the economic slowdown. Fashion jewellery as an industry is growing strongly. CAGR for the segment is growing faster than precious jewellery. Indian consumers are possibly down-trading. From owning a precious piece of jewellery, people have been buying jewellery that they can wear on a daily basis.

 

While many international brands in India are retailing through flagship portals, Swarovski’s website still does not have a shopping function. Does the company have an ecommerce plan for India?

Given our growth rate in India, there are plans to expand online and offline. We have a small presence on Myntra but we are looking to grow into different online concepts now. We are currently working on introducing the shopping function on our website in India. It should be up relatively soon. Looking at the size of this market geographically, we need to make sure that our infrastructure is in place. It will thus take a little time.

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Currently, we have 45 mono-brand boutiques in India. We are looking at offline stores in Tier 2 and 3 cities now. Our online sales from smaller towns and remote areas indicate an appetite for the brand.

 

This is the first time that Swarovski launched a dedicated Diwali campaign for India in 2019. What were the reasons?
We want to remain relevant in this market. The Diwali campaign is a sign that we are putting focus on India. Diwali helped us cater to the demographic here which is getting younger. We are planning additional campaigns for 2020 with more localized activities and possibly even from a product perspective in the future. Appreciation of local holidays, culture and religion is important to maintain connection with the consumer.

Swarovski recently tied up with Nike for specialised golf shoes for women. Are there any plans to collaborate with brands or fashion platforms in India?
Globally, we have collaborated with brands and luxury labels such as Christian Dior, Alexander McQueen, Off White and Supreme to crystalise their products. We are a key partner for the Oscars and a lot of Hollywood productions. Bollywood in India is an obvious collaboration for us. There is nothing we can announce or confirm yet. The Indian film industry has a lot of potential. Given the focus on the India market, we will collaborate with Bollywood and local designers. We could even collaborate with an online fashion platform to come up with a line.

 

What is the company’s brand vision for India?
We have been constantly increasing the number of stores in India and see potential for further expansion. According to Euromonitor, the $135 million fashion jewellery market in India grew 15% in 2019. This number is predicted to double in the next four years. It is a small market at the moment compared to the overall jewellery market but is growing at a high rate.

Trends such as smartphone penetration, growth of middle class, middle class income and awareness of international trends and brands have been reasons. We can take advantage of this development and take the brand to the next level in India. I want to put the medal on the pedal when it comes to India now.

Courtesy: Economic Times
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