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Swarovski, Austrian affordable luxury company known for its glass-based products like jewellery, watches, and crystal decorations, is focusing on selling lab-grown or cultured diamond jewellery in India. Although the product line was introduced globally last year, it is now being sold and promoted in the Indian market, Nasr Sleiman, Swarovski’s general manager for India, Southeast Asia, and the Middle East, told Mint.
“‘Created diamonds’ is now the fastest-growing business category in this region. We think it’s because the pricing is also very attractive from an end-consumer standpoint. Globally, the prices of diamonds have fallen, so this business will grow a lot in the coming days despite the fact that the category needs a little more awareness right now, ” he said.
Jewellers said natural diamonds are about 10-30% or so cheaper over last year, depending on the quality. Lab-grown diamonds are typically 40% the price of natural diamonds.
“We launched our ‘created diamonds’ segment earlier in the year in the country and we want it to have a strong presence here. It was a big success in the US market and that’s why we decided to roll this out in other important locations like China, Japan and also in Dubai,” he said. Swarovski crystals generally are made from a combination of quartz, sand, potash, soda, and other ingredients that are melted at high temperatures.
Outside of Austria, the company has factories in Serbia, India, Thailand, and Vietnam. A majority of its sales in India, about 80-85%, come from its jewellery lines, with the remainder coming from its bridge-to-luxury Swiss-made watches that are priced upwards of ₹20,000.
While a sluggish luxury market, along with unstable geopolitical and macroeconomic landscape has dampened business in one of its top markets, China, it has also meant it is focused more on other geographies like India, where it plans to add 10 stores to its existing count of 60 in the next one year. At present, the company operates its own boutiques as well as works with local partners in India to sell its inventory. It opened a new company-operated store in Gurugram earlier this month, and looks to add airport retail across different cities in its next phase of expansion.
“Our next set of stores will be a mix of both, retail and travel retail and will be a mix of owned and partner stores. We don’t want to open everywhere in India, and will try and focus on locations that can sustain long-term business. Duty-free is growing very steadily here and that is a great avenue to be present,” he added.
Globally, Swarovski has 6,600 points of sale, of which 2,300 are company-owned stores.
The company first launched its store in India in 2000, and has since then shifted its positioning in the country from a “shy presence” to a very strong one.
“The potential of the country today has really changed. The retail market landscape has evolved beyond just the usual suspect cities to include many other cities like Hyderabad, Chennai, Bengaluru and so on,” said Sleiman.
The company said it had total sales of €1.8 billion in 2023, 4% higher than in 2022. It saw growth in all its categories of business including retail sales, business-to-business crystal sales and the consumer jewellery business. While its top-10 markets saw consistent growth, the company’s Ebit (earnings before interest and taxes) returned to positive territory for the first time since 2019, despite a significant foreign exchange impact.
Luxury consumption in India growing
India’s appetite for luxury consumption has been steadily growing in recent years. Last month, Mint reported that affluent Indian consumers are increasingly spending on high-end luxury goods, driving strong sales for some of the world’s leading fashion labels.
This trend is occurring despite a slowdown in domestic consumption and a decline in sales in China, a key market for luxury brands. The local operations of Louis Vuitton, Christian Dior, and Hermes collectively reported sales of ₹1,400 crore from clothing, accessories, and other merchandise for the year ended March 2024, based on exclusive filings accessed through business intelligence platform Tofler. Swiss watches worth ₹2,075 crore were sold in India between January and October this year.
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