JEWELLWORLD.

COM
A CASE STUDY

By: Group 6

Nidhi 2010151
Niraj 2010152
Pankaj 2010153
Pankhuri 2010154

Paul 2010155
Praveen 2010156
Overview
 China – Biggest jewellery markets, projected global jewelry center by 2010.

 Hong Kong is the leading processing center for jewelry in Asia,

 distribution hub globally.

 $ 0.94 billion in retail sales;
 3rd largest exporter- 2.95 billion $ exports.
 Brisk sales of Hong Kong jewelry because of its design and quality.

 Jewellworld.com founded in May 2000.

 subsidiary of Luk Fook Holdings – low priced jewellery targeting young

people.
 Established as B2B online portal and then expended to B2C model in
Hongkong.
Overview - Market Scenario

 Huge market potential in mainland China as spending power on the rise.

 Consumption pattern of young generation is becoming more

internationalized – increase internet usage.

 CEPA- zero tariff; possibility of price reduction attracts customer leading to

both buyer and consumer profit.

 Contemplative Decisions to be taken:

 Whether expand to mainland China through online B2C model.

 Target Market segment.
External environmental factors
●
Hong Kong ●
English is the
supported by dominant language
Chinese ●
Hong Kong jewellers,
government consumers are by no
●
CEPA , independent means IT savvy

Political Social

economical technological

●
technology was
●
china’s GDP rapid
mature enough for
growth.
JW to develop B2B
●
Hong Kong - 3rd ●
security and privacy
largest exporter;
over the internet
Other environmental factors

Different age group have different preferences,

internet skills and income

●
Demographic

Few big players and a large number of smaller

players

●
Fragmented Industry
 St rengt hs
Experi ence gained by pr ovi ding
ser vices to i ts parent company
Best-known brand in mainl and
Chi na

Opportunity
High Market potential
Growing internet usage
First mover advantage.
Swot Analysis

SWOT
Porter’s 5 forces Model
Bargaining Bargaining Threats of Threats of
Competitive
power of power of potential substitute
Rivalry
customers supplier entrants products
Medium Low High High Medium

• Local retail •International • Attractive • Retail • High no. of

alternatives prices of precious market for other showrooms, local
available. metals and gems Hong Kong since high competitors
jewelry houses footfalls
• Low •Cost of shipping owing to CEPA. • Different target
purchasing group.
power of target • Increasing
group. International
brands.
Decisions for entering China market

business
●
Currently 77 million broadband users, rising at 20% rate annually.
●
High Regard for Hong Kong jewellers in china.
●
Much larger, unexploited customer base.

environment   Rising GDP growth, especially of coastal cities.

●

●
No fierce competition in the target age group.
Industry trend  ●
Jewellery market in mainland China lacks
brands and designs

Competitive
●
first mover advantage.
●
Knowledge and experience from LF about width and depth of the
industry

Advantage Experience in IT services.

●

●
Expert in security surveillance systems
 Target Segment
Experienced in Consumption pattern among
young generation -
catering to relatively Internationalized (brands),
Increase in spending power
young age group Highest share in internet
(18 – 30 yrs) users.

priced lower; target

market- low to mid
end market and mid
to high.

USP’s- Innovative,
18-30 years ; low
Internet Access – Age and Income
Attractive, High
to Mid and mid to
quality, Competitive
9%
high segment
price
7% 3% 1%
47%
12%

21%

UNDER18 18-24 25-30 31-35

Challenges while entering China
Payment through
Low average credit card poses
salary of 18-24 a cyber threat
years age group issues.
customers.

Delivery system is
Should it focus on unreliable and
other age groups? EMS is costly.
Should it adopt a
mass-market
strategy?

People sceptical
about Quality of
goods, after sale
service, company
reputation, etc.
Overcoming Challenges

Low Jewellworld should offer cheap products in which

they already have core competency. They can
average introduce EMI schemes to interested buyers
salary specially during occasions like Chinese new year,
Labor day, National day. Focus
Group

Initially, they should not focus on other age segments

because companies like laofengxiang, laomiao, chow
tai fook, luk fook are already serving them efficiently.
Also internet usage is maximum in age group of 18 to
24.

They have good IT experience (in security Credit

surveillance too) by providing services to
parent company Luk Fook. 37.9% of internet
card
users are using credit card. Still there is an usage
option of cash on delivery system.
Overcoming Challenges Contd..

Delivery
system

Contract (outsource) to a single major shipping

company.
Order in bulk to reduce cost

Quality
&
service
Jewellworld is known for its quality and
service, this is the reason they used to
target mid to high end customer by
offering products at a relatively high price
than local producers.
Suggestions
 Provide multilingual version of website.

 Expansion of product range, can include products like

watches, belts, cutlery etc..

 Customer awareness through advertisements. E.g.

information on IT/jewellery industry

 Re-packaging and improving existing service offerings. E.g.

Providing a higher level of customisation in its service
Thank you