Daybreak - Diamonds with a side of champagne — how Zoya finally hacked the luxury jewellery business

Episode Date: February 25, 2025

How do you sell diamonds to the ultra rich? Well, Zoya, the luxury jewellery brand from Tata-owned Titan Company can give you a masterclass. The Zoya playbook isn't focussed solely on designing and selling premium jewellery. Turns out, it’s all about the experience. From champagne brunches, to luxury cruises — the brand stops at nothing when it comes to nurturing its client relationship. For 15 years, Zoya, the ultra-luxury jewellery brand from Tata-owned Titan Company, wasn’t so much a business as an expensive exercise in patience. A handful of boutiques, a tiny customer base, and no profits. Now, suddenly, things are different.As of FY25 Zoya is finally profitable. But here’s the problem: luxury is having a moment in India. Tiffany, Cartier, and Bvlgari—all want a bigger slice of the pie.Tune in. Daybreak is now on WhatsApp at [phone]. Text us and tell us what you thought of the episode!Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganeshan, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production.

Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get alert, as soon as we release our first video. episode, please follow intermission on Spotify and Apple Podcast or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. You sell diamonds to the ultra rich. Well, Zoya, the luxury jewelry brand from Tata owned Titan Company, can give you a masterclass.

For starters, it is all about the experience. Just take Kaushal and Swati Pandey from Mumbai, for instance. They're both doctors and have been patrons of the brand for the past 12 years. The couple, like most of Zoya's clientele, enjoy the finer things in life. I'm talking luxury cars, fountain pens and, well, jewelry, of course. They've been known to visit Zoya multiple times a month and oftentimes drop up to 40 lakh rupees on each purchase. But if you paid closer attention, you would know exactly why the country.

couple chooses Zoya over most other jewelry brands. You see, Zoya really nurtures its client relationships, which is why there have been times when the staff has kept the store open past 10 p.m. Just so they could take their time deciding whether to buy a particular piece or not. Or just take the case of Abhay Gupta, the founder of multiple high-fashioned supply chain agencies and another frequent customer of Zoya. He recalls how the brand treated him and his wife to a cruise just to witness the festival of Dave De Pavli and Varanasi because it, quote-unquote, aligned with their interests.

On another time when Zoya helped hook Gupta up with a range rover on short notice by putting in a good word with Tata Motors Jaguar. Now, the reason I'm giving you a sneak peek into the lives of the ultra-rich is not to make you feel bad, but to explain how Zoya finally managed to turn things around for itself. This is a company that has been around for 15 years and still only has a handful of boutiques and a very tiny customer base. And up until recently, no profits. But now things are different.

As of FY25, Zoya is finally profitable. It's nowhere close to being as big as items other offerings like Tanishk or Carit Lane. But that isn't the goal for this brand. Zoya is not built for scale. Its vision has always been clear. For an Indian company, having a foot in the global luxury club, is both aspirational and a great,

strategy for margins. Those margins come from a very simple yet effective insight. Rich women over 40 love buying jewelry for themselves. It's simple and it makes complete sense. You've earned your money, maybe your kids are grown up and now finally you get to splurge. Even on jewelry that you don't just lock up but actually wear. And Zoya has designed everything around the small but fiercely loyal customer base. This strategy is working, but there's a problem.

Luxury is having a moment in India. And Tiffany, Cartier and Bulgaria all want a bigger slice of the pile. Welcome to Daybreak, a business podcast from the Ken. I'm your host, Rahel Philippos, and I don't chase the news cycle. Instead, every day of the week, my colleagues Ticka Sharma and I will come to you with one business story that is worth understanding and worth your time. If you take a look at Zoya's story so far, you would definitely. definitely start wondering what's going on.

For 14 years, it expanded at a glacial pace. It opened only eight boutiques across the country. And then in 2024, it went ahead and opened four new stores in Pune, Chennai, Mumbai and Kolkata. And the company's business head, Amanthrit Aluwalia, says it has a plan to keep the momentum going by opening three to four stores every single year. He explained that the idea isn't really to scale, but rather to be in the right place at the right time. And that also means choosing locations very carefully. Just take Bangalore, for instance.

Unlike Carrot Lane or Tanishk Tata's other brands, which would usually set up stores in commercial hubs, places like Indranagar or Kormangla, Zoya doesn't go down that route. Instead, its boutique is located in a less chaotic yet upscale Vital Malia Road. Al-Aulia explained that this was very intentional. They didn't want to be in a congested or crowded neighborhood, but they still want it to be in the heart of the city. That's why in cities like Mumbai, you'll only find Zoya at upscale malls like Palladium. They're going for exclusivity.

The whole experience inside the store also screams just that. There aren't any crowds or rush to make a choice or sales pressure of any kind. In fact, once you enter, you'll be welcomed with things like chocolate truffles and different flavors of tea or juice. Zoya offers a full-service hospitality experience. One of the relationship managers at the company's Bangalore outlet said she hosted clients for over seven hours at the store in the past.

But the main attraction, of course, is the designs. Abbe Gupta, who I told you about a little while ago, fondly recalls a pair of earrings his wife purchased that looked like bubbles. He said they were an absolute hit at a champagne lunch they had once gone to. Turns out, there's an in-house team coming up with these designs. They spend anywhere between 10 to 14 months on each collection. and there are only two collections introduced every year. You see what I mean about exclusivity? The brand holds intellectual property rights,

patents and trademarks for certain gemstone cuts and designs. While Zoya does share some manufacturing facilities with Tanishk, it keeps its signature collections separate. So they're all produced exclusively at its Patnagar unit in Uttarakhand. But this exclusivity comes with a narrow customer pole. Zoya caters to only about 3,000 to 4,000 customers. and that's just a fraction of the customers Tanishk had in FY22.

So staying profitable means playing a balancing act between inventory turnover and gross margins. Zoya ends up enjoying higher margins than Tanishk, yes, but its inventory turnover is lower. Now, inventory turnover ratio essentially measures how many times

a company sells and replaces its inventory over a given period. The reason is simple. Boutique sell vanity, not just material value. The kind of jewelry on offer at Tanish and Zoya also varies significantly. 90% of Zoya's inventory is studded jewelry, while Tanish mostly has gold jewelry. That also explains the difference in margins and turnover between the two brands.

Typically, the margins on gold are lower, but since they are more takers for the metal, there is higher inventory turnover. Zoya therefore needs higher margins to stay profitable, which explains the premium in charges for his jewelry. Vinita Makija, a senior marketing executive, said 30% making charges on Zoya's jewelry is quite high, but it's attributed to the designs. Now, the thing is, when we look at Zoya's business model, it isn't just thinking about its designs and how well they're selling, its other big focus is turning its customers into loyalists.

More on that in the next segment. Hi, daybreak listener. I'm Snigda, the co-host of this podcast. Are you enjoying this episode so far? If you are, then could you please spare a few seconds to rate daybreak on your preferred streaming platform, Apple or Spotify, and also please hit follow? We've been trying really hard to beat the algorithm gods and a little help from you will really, really go a long way and help our podcast grow. Thank you in advance, and now back to Rahil. When you're a Zoya customer, loyalty really pays off.

The brand runs a tiered loyalty system based on its customers' lifetime sales. spending. So if you spend up to 19 lakhs, you're a tier 1 customer. You're a tier 2 customer if you've spent up to 39 lakh. And the highest tier is tier 3, which is reserved for people who have spent 40 lakhs and above. Naturally, the perks get better

the more you spend. In many cases, that could mean discounts. But beyond that, the brand goes out of its way to make high value customers feel special. So it'll reserve pieces for some or curate luxury experiences like cruises for others, the works.

And just like that, Zoya is able to build brand loyalty. The Ken spoke to one customer who went from gifting Gucci and Chanel products to his clients to Zoya pendants and earrings. And when you show Zoya loyalty, the company always reciprocates. They'll do that by organizing events for its clients twice or thrice a month in each city and then lets the latter host their friends at its boutiques. But how do clients get to know about the brand in the first place, considering its relatively low profile?

Well, turns out most of them come from existing client networks and offline experiences. Zoya also offers bespoke jewelry, the ones that are custom made for a specific event or a client. Such pieces are never displayed or brought into stores. They directly reach clients who are offered multiple consultations with the head designer. These clients also get to preview other collections before launch. This sort of thing contributes to about 4% of Zoya's total revenue. But while this may have given the Tata's an early mover advantage in the Indian luxury jewelry business, now there's an influx of players trying to grab a bigger slice of the pie.

Stay tuned. Luxury has really been having its moment here in India. India's rich and ultra-rich have been growing at 6% annually compared to a 0.8% overall population growth. And that largely has to do with a strong stock market performance, a wave of IPOs and a booming startup ecosystem that's generated. a new class of which. I'm talking about founders and CXOs. Now, brands have been rising to the occasion. They want to capitalize on the country's potential to grow into the next market for global luxury. One such brand like Zoya is Forevermark, the diamond jewelry brand under the South African British company, Dibyirks Group. Unlike traditional luxury brands, Forevermark's strategy is to

seize the Indian market that's thriving on new money, expansion and scale. And so the company wants to expand beyond just tier one cities. It wants to enter tier two and tier three markets as well. Now, unlike Zoya, it isn't claiming to be a luxury brand. Its strategy instead is to position itself as a premium diamond

jewelry international brand rooted in India. Of course, Zoya claims it's not tracing scale. At least not yet. It also has an eye out on the global market. Of late, it's been testing international waters and it's currently operating five Zoya galleries

inside Tanish stores in the US. The question is, will women outside India be as drawn to Zoya's intricate Indian designs as those at home? Daybreak is produced from the newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters and podcast extras. Head to the Ken.com and click on the red subscribe button. on the top of the website. Today's episode was hosted by Rahil Filippo's and edited by Rajiv Sien.