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    Covid-19 Impact: Titan reworks omnichannel directive for its jewellery wing to gain recovery in third quarter

    Synopsis

    The lockdown has dampened the general mood and consumer sentiment. People are sticking to essentials and discretionary spend is low. We, however, reached out to many of our customers and asked if there are still looking to purchase gold this Akshaya Tritiya. Surprisingly, over 50% of our customers responded positively.

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    Representative Image
    In a country where gold is considered an important asset, Covid-19 lockdown and accompanying low discretionary spend questions the future of the precious jewellery market. Ajoy Chawla, CEO of Titan’s jewellery division that sells Tanishq, talks to ET’s Smita Balram on the challenges posed by the lockdown and its business revival strategies in times of the pandemic. Excerpts:

    What is the general outlook for the jewellery industry this year?
    Reality is that 2020 is going to be a different year compared to any other. At Titan’s jewellery division, Q4 was progressing well till March 15. Covid-19 outbreak hit our business. All our 280 jewellery stores are currently shut.

    There is hope that Diwali period coupled with the wedding season will make Q3 more positive than Q1.

    We feel there may be some deferred demand for weddings getting postponed from Q1 to Q3 or Q4 and some pent-up desire for gold jewellery due its investment value. Birthdays and anniversaries could be occasions for purchase too.

    What is the company’s strategy to overcome the challenges this year?
    We have to start thinking in terms of weeks and not months as the situation is dynamic. We have to go granular and operate at city and district level. The national macro view will be replaced with deep dives into region-wise progress as micro as a comparison between western and eastern parts of Uttar Pradesh.

    The festival of Akshaya Tritiya falls during the lockdown period. What are your expectations from the market in these uncertain times?
    The lockdown has dampened the general mood and consumer sentiment. People are sticking to essentials and discretionary spend is low. We, however, reached out to many of our customers and asked if there are still looking to purchase gold this Akshaya Tritiya. Surprisingly, over 50% of our customers responded positively. They view it as investment backed by emotion and tradition.

    After Dhanteras, Akshaya Tritiya is the second most important day in the year for us. We have created a few enablers to drive sales this time such as online prepaid orders, tech-enabled remote shopping with video chat and extended exchange validity.

    Covid-19 outbreak will change the way retail is executed in India. How is Tanishq preparing to reopen its stores?
    We are hardware-prepared. A visual-based communication is training our staff on mobilising materials such as disposable gloves, sanitisers, masks for customers and staff, and corona virus scanners in place at the physical stores once we reopen after the lockdown. Only half the staff strength will be deployed to ensure distancing and ample back-up. A zero-defect plan for factories and vendor partners is being developed and deployed over the next two weeks.

    In the first few weeks of reopening, we will experiment with appointment-based booking to control the flow of traffic at the stores.

    Will ecommerce take dominant focus for your jewellery division this year?
    Like other organisations, Titan is also learning from China and Korea. Clearly, there is a shift towards digital as there is a new habit formation. Digital and remote buying is going to be the order of the day. We are looking at actively promoting an omnichannel approach. Interactive video shopping and online orders backed by quick visit to the physical store for product pick-up will gain momentum. Trying jewellery at home with our executive is another solution we hope to roll out once we regain the entire staff strength.

    What government intervention does the jewellery industry want in the wake of Covid-19 outbreak in the country?
    The government can help by ensuring that there is support provided to businesses in the form of liquidity. The three-month moratorium given by the Reserve Bank of India should be extended till September. Even if cash flow returns in Q2 post lockdown, the six-month window will help businesses. Some tax-related benefits such as lower customs duty will help reduce gold smuggling.

    This is a very unorganised industry with lakhs of karigars who work in poor living conditions. With the cash flow being tight, there is a need to support them to tide over the crisis. We have been engaging with the Ministry of Commerce to avail few direct benefits for karigars.

    We don’t expect the government to dole out money as they need it right now to fight the pandemic. But such simple measures will help revive the industry.


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    ( Originally published on Apr 18, 2020 )
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