Tanishq is India’s fastest-growing jewelry brand, contributing the most to Titan Company’s total revenue. This is success story of Tanishq.
Introduction to Tanishq’s Rise
But what does the name Tanishq mean?
Mr. Xerxes Desai, a former Managing Director of Titan, chose the name Tanishq. When broken down, “Tan” means body, and “Nishq” means gold ornament.
The name was perfectly chosen.
You may know that last year, Tanishq faced controversy due to an advertisement. However, today we won’t discuss that controversy.
In this blog post, we’ll explore how Tanishq’s story transformed from a flop movie to a blockbuster hit.
Let’s dive into the details.
The Genesis in a Crisis
The story begins in 1991 when India faced a foreign currency crisis. Reports suggest India had forex reserves for only 15 days of imports. During this time, Titan’s watch business was performing well, but it required importing equipment, needing constant forex. Due to the crisis, the government asked Titan to earn its own forex. This pushed Titan to search for a new business to generate foreign exchange easily.
A Spark at an Exhibition
During this period, Mr. Xerxes Desai attended a Gems and Jewelry Exhibition at Mumbai’s Taj Palace Hotel. After thoroughly observing the exhibition, he noticed the jewelry designs were mediocre, and the craftsmanship was very ordinary.
Mr. Desai thought, why not have Tata and Titan, a part of the Tata Group, venture into the jewelry manufacturing business?
Indians were already being misled in the name of jewelry—sold 15 or 11-carat gold instead of 22-carat. Mr. Desai wanted to break these unfair practices.
The Reality of Gold Purchases
Consider your own experience: if you’ve ever sold old gold, you likely received much less than its value. The reason was often impure gold. Even now, despite Indian government standards like hallmarking, such practices persist in some places.
Let’s return to the story.
Launching the Jewelry Venture
After extensive research on Mr. Desai’s jewelry business idea, Titan Company gave it the green signal. Mr. Shantharam, a project manager from the watch division, was tasked with starting the jewelry business. A large gold jewelry plant was set up in Hosur, Karnataka, with a 65-crore investment.
Initially, Titan focused on producing jewelry solely for export to meet its forex needs. Thus, Titan prioritized European markets for selling its jewelry.
However, in the 1990s, the global economy was down, with people focusing on savings. Consequently, Titan’s jewelry business failed in Europe. They tried the American market, but it made little impact.
Pivoting to the Indian Market
Titan then decided to launch its jewelry business in India. The Indian jewelry market was fragmented, with many small family jewelers but no major national retail brand. Mr. Desai was confident that the Tata brand would benefit Tanishq.
With this confidence, Tanishq introduced 18-carat European-style jewelry in India. Mr. Desai and his team believed they would transform the Indian jewelry market.
But it didn’t happen. Soon, they realized there was little demand for 18-carat jewelry in India. While 18-carat was a global standard, the Indian market was an exception.
Missteps in Market Research
Titan’s research revealed that Indians buy gold jewelry not just for adornment but also as an investment. This was where Titan made a mistake.
While Tanishq’s designs were praised, the 18-carat jewelry didn’t sell. Realizing their error, Titan launched 22-carat gold jewelry based on Indian traditions. You might think this solved all of Tanishq’s problems, but it didn’t.
Persistent Losses
The introduction of 22-carat jewelry helped slightly, but losses didn’t decrease. Tanishq had accumulated nearly 100 crore in losses and was drowning in debt. The Tata Group considered selling the jewelry business, as it was affecting Titan’s watch business.
Tanishq needed to prove itself.
A New Leader Emerges
Enter the new hero, Mr. Vasant Nangia. He was appointed to lead the struggling jewelry division. Mr. Desai gave him full freedom to choose his team and make business decisions.
Revamping the Basics
The team began improving the basics. Indian jewelry buyers demand details like gold weight, diamond weight, and making charges. Tanishq updated its price tags to include this information, making it easier for staff to explain gold to consumers.
Store layouts were changed to better showcase the product line. Display trays, staff uniforms, and training programs were all revamped.
Yet, despite these efforts, something was still missing. Sales weren’t increasing significantly.
The Game-Changing Karatmeter
Mr. Shantharam, a team member, saw an X-ray machine at the 1996 Basel World Watch and Jewellery Show that could test gold purity in three minutes, later called the Karatmeter.
He informed Mr. Nangia, who quickly saw its potential. The challenge? Each machine costs 10–12 lakh, unaffordable for a loss-making business like Tanishq.
Convincing Mr. Desai was necessary, and he approved purchasing 14 machines despite the situation.
It was time to test the machines.
Testing the Market in Indore
The team chose Indore, Madhya Pradesh, where gold consumption was high, and impure gold sales were common. On the test morning, Tanishq published a newspaper ad stating, “There’s a thief in your family,” targeting family jewellers. It invited people to visit stores for free gold purity checks.
People visited and were shocked—22-carat gold was often 16 or 17-carat. One lady found her 22-carat bangle was only 11-carat. Tanishq’s strategy hit the mark, and the news spread like wildfire. Crowds flocked to stores to check their gold.
Backlash from Jewelers
As expected, family jewellers protested outside Tanishq stores, furious at the campaign. Police were called to control the situation.
This incident created positive awareness about Tanishq among gold consumers.
Overcoming Perception Challenges
However, the problem wasn’t fully solved. People visited Tanishq stores to check gold but didn’t buy, perceiving Tanishq as a premium brand with expensive jewelry.
Tanishq needed to change this perception.
A Customer’s Wake-Up Call
One day, a lady visited Tanishq’s Bengaluru store, tested her jewellery on the Karatmeter, and was leaving. A top Tanishq official asked if they could assist further. She snapped, saying they only made her feel bad about her gold without offering solutions.
This struck the team deeply. They realised they had identified the impure gold problem, but offered no solution to customers.
The Revolutionary 19=22 Scheme
After serious brainstorming, Tanishq introduced the 19=22 scheme. If gold tested between 19 and 22 carats, Tanishq would exchange it for 22-carat gold, covering the gold difference cost, with consumers paying only manufacturing charges.
This genius idea worked wonders.
A Turning Point
People flocked to stores to exchange their gold. During Diwali, many Tanishq stores recorded over 1 crore in profit in a single day due to this scheme.
Tanishq never looked back. They shifted advertisements from a Western, classy setup to Indian tradition-based ones, making people aware of affordable, tradition-inspired jewelry. Customers began purchasing new jewellery alongside testing.
Tanishq’s Dominance
Titan’s jewellery division, once contributing single digits to revenue, now accounts for 83%, while the watch division contributes only 13%. Tanishq launched brands like Mia for working women, Rivaah for handcrafted wedding jewellery, and even Padmaavat movie-themed jewellery, which became highly popular.
A Collective Triumph
Tanishq’s innovation journey wasn’t dependent on a single visionary like Steve Jobs but was driven by the inspiration of many hearts and minds.
Today, Tanishq is India’s largest and most successful retail jewellery brand, thanks to the trust in the Tata brand, its logo, and a consistent focus on quality improvement.
Conclusion
This was Tanishq’s story—from a flop movie to a blockbuster hit. If you found this blog post interesting, please share and engage with it.
Thank you!