The Golden Harvest scheme has been contributing a little under 30% of our jewellery sales. But with the networth cap that the government has brought in, the scheme would certainly contribute less, difficult to say, maybe around 10%. But we would know only when it pans out. But it would be much less that it traditionally contributed," CK Venkataraman, chief executive officer of Titan's jewellery division, said.
Jewellery retailer Titan wouldn't be reaping a fortune with its recently revived Golden Harvest scheme as its size is likely to shrink to a third of the corpus it had a little more than a year back.
"The Golden Harvest scheme has been contributing a little under 30% of our jewellery sales. But with the networth cap that the government has brought in, the scheme would certainly contribute less, difficult to say, maybe around 10%. But we would know only when it pans out. But it would be much less that it traditionally contributed," CK Venkataraman, chief executive officer of Titan's jewellery division, said.
Relaunched in November, the jewellery purchase scheme in which customers make monthly contributions would start getting converted into sales only in October onwards.
"It was withdrawn because of the new law that came in the early part of fiscal 2015. The scheme was relaunched with new conditions in November. The result of the scheme would come a year later as people are now enrolling and would redeem only after they complete their term in October. But despite the current constraints scheme is doing well," Venkataraman said on the sidelines of the opening of a Tanishq store.
Titan as well as other jewellery chains were forced to withdraw their schemes with coming into force of the new Companies Act, which saw such initiatives as public-deposit schemes.
The brochure of the new revamped scheme offers two tenure options of six months and 10 months.
"The scheme is now in a settling-in period of a year or so. While demand for jewellery is independent of the need to finance, it's also a fact that the scheme was attractive acting as a trigger to save. It would be a challenge to make up," Venkataraman said.
Nil contribution from the scheme as well as poor demand had hurt Titan in the fourth quarter with jewellery revenues declining 15% year on year.
To push sales, Tanishq has started focusing on advertisement; after a month of a campaign highlighting purity and quality issues, it has roped in actor Deepika Padukone as its brand ambassador.
"There are so many concrete things about Tanishq which we took for granted, but were not well known to our own customers. So we carried the purity campaign for the whole of last month after systematic assessments of the total value that the brand was offering. Now we are back with a campaign that highlights what the brand really is," Venkataraman said.
This year Tanishq would open 30 new stores and 15 for its new brand Mia, a light jewellery brand for working women.
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