Tanishq and De Beers collaborate to boost natural diamond sales in India

New Delhi: Jewellery retailer Tanishq and diamond company De Beers Group on Wednesday announced a long-term collaboration stretching over three years to boost sales of natural diamonds across the latter’s over 475 stores in India.

The move comes as domestic demand for natural diamond jewellery touched 11% of global demand. In 2022, the total value of the diamond jewellery market worldwide amounted to $86.5 billion, as per global data and business intelligence platform Statista. India still remains a dominant gold jewellery market.

However, both Tanishq and De Beers expect that to change as more women join the workforce and buy into precious stones and invest in jewellery.  India also replaced China as the second largest market in the world for natural diamond jewellery.

Annually, Tanishq, part of Tata Group's Titan Co. Ltd, services between 3 million and 3.5 million customers; of these, less than a million are customers of studded diamond jewellery.

“We believe this number can easily double (customers serviced) if the customer was more confident about buying diamonds. The constraint is at the level of understanding. Only advertising campaigns don't make that shift, they may create desire but the final conversion and confusion sorting happens one-on-one,” said Ajoy Chawla, CEO, Jewellery Division, Titan.

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Chawla dubbed this association as an “extensive customer outreach” exercise. 

There will be significant investment in terms of money, energy and resources, he said in an interview with Mint. Chawla did not divulge figures for the investments behind the association.

Stamp of authenticity

The association builds on the existing relationship between Tanishq and De Beers, with Tanishq already using De Beers’ proprietary diamond verification technology to support the assurance of the authenticity of its products. The two parties are engaged in conversations regarding opportunities to collaborate on diamond traceability, how Tanishq’s diamond supply needs can be met and further opportunities to use De Beers’ technologies to support pipeline integrity, the two said in a statement.

The collaboration will focus on “deepening capabilities” of Tanishq’s retail staff to communicate information about natural diamonds, educating consumers about authenticity of natural diamonds and studded jewellery. This will also be supported by marketing campaigns.

With diamond acquisition rates in India well below those in mature markets such as the US, this provides a significant opportunity to catalyze further growth for natural diamond jewellery in India, Sandrine Conseiller, CEO of De Beers Brands, said in a statement.

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To be sure, Tanishq is among the largest jewellers in India; parent Titan also operates other jewellery brands such as CaratLane and Zoya. The current partnership is however restricted to Tanishq and Mia (a sub-brand under Tanishq).

Last fiscal, the company’s jewellery division reported a total income growth of 20% to ₹38,353 crore. Overall, studded diamond jewellery accounts for 30% of the company’s jewellery sales (by value)—across brands.

Lab grown diamonds

The move also comes amid the rising popularity of lab-grown diamonds, which are cheaper to own than natural diamonds. India is an exporter of lab-grown diamonds. However, domestic demand is also being stoked by new-age players trying to compete with established jewellery retailers. This is also prompting existing retailers to boost the proposition of natural diamonds. 

In 2022, India’s lab grown diamond jewellery market was valued at $264.5 million, as per management consultants Technopak.

By the end the next decade, lab grown diamond jewellery sales are expected to rise at 14.8% CAGR, increasing the market size from $299.9 million in 2023 to $1.1 billion by 2033.

However, both Conseiller and Chawla, downplayed demand for lab-grown diamonds in India. 

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Chawla said there is too much “media noise” around it. "We are not seeing any significant demand for lab grown diamonds across our network of stores. Yes, customers come asking for clarity; they are confused about lab grown and naturals…Those are the nature of conversations that we have heard so far. They are very different (consumer) segments,” said Chawla.

To be sure, De Beers operates in exploration, mining, grading, marketing and retail of natural diamonds. 

It also sells diamonds under the Forevermark brand name—that has a limited presence in India. “In terms of retail, India is very limited for us, until now. In April we announced that we will further develop Forevermark in this market. We will see new stores coming 2025 onwards,” she said.