In one of the world’s largest jewellery markets, Ornaz wants to become synonymous with marriage proposals and is targeting millennials in late 20s and early 30s in Tier 1 cities.
Manik Bhola, 25, comes from a family with five-generation-old diamond business. A computer science engineer by education, Manik wanted to start up on his own. He founded two startups in consumer internet sector, but both shut down in a few months. After working with online fashion marketplace Jabong and Gurgaon-based startup Ekatrra in product management, Manik started up again. It was third time lucky for him!
This time, Manik decided to work in sectors he knew – precious jewelry and e-commerce. He says, “I wanted to make a company for millennials, with a focus on solitaires for engagements etc. because there is no other player in this vertical.”
As a bootstrapped online retailer of diamonds and engagement rings, Ornaz.com went operational about a year ago. Today, the Gurgaon-based startup is growing at 150 percent quarterly.
For Manik, the family business background helped. “For generations, my family has had the most discerning eye in the diamond business. I also had a thorough understanding of the jewellery business, how to manufacture and sell jewellery and make the best out of it. I know how to check diamonds for clarity, colour and carat. Being a relentless innovator, I was determined to marry my heritage with the way people shop today- Online,” he says.
Although he is a solo founder, Manik has a co-founding team of e-commerce professionals, including Ishan Chawla, from Jabong, and Ashish Kapoor, who was with BlueStone and Caratlane. Currently, the Ornaz team has grown to 21 people.
Derived from the word ornaments, Ornaz aims to offer diamonds and engagement rings of highest quality at affordable prices. Manik wants to make Ornaz synonymous with (marriage) proposals and is mainly targeting millennials in late 20s and early 30s in Tier 1 cities.
Although Ornaz competes with offline jewellery retailers as well as online players like Bluestone and Caratlane, Manik claims that Ornaz’s USP as a brand is the focus on love and proposals.
“Transparency, authenticity, and customer service are the issues in the industry. We aim to solve these,” he says. Ornaz has a just-in-time (JIT) model. Jewellery manufacturing takes about three days, and delivery takes up to five working days. With no inventory and physical infrastructure, they have minimal overheads.
“We pass some price benefits to our customers in the form of lower prices. We have two points of sale - first directly through website/app, and the other through Try@Home,” Manik adds.
The company is coming up with features such as diamond display technology and virtual showroom experience to cover all limitations while buying engagement rings and jewellery from online and offline jewelers.
Currently, Ornaz has about 50,000 registered customers, and more than 500 couples have been hitched with Ornaz’ engagement solitaire rings. They also sell on marketplaces like VelvetCase, Amazon and Flipkart, and work with wedding planners like Wedmegood and Weddingz.
On their website, Ornaz aims to use technology to break ground in the traditional diamond industry, and provide a better diamond buying experience for the customer.
“We provide better pricing and better value by using innovative technologies,” Manik says. They also take care of logistics on their own in Delhi-NCR and use third party players outside.
According to Manik, Delhi-NCR, which is catching up with Bangalore as the new startup destination, is the perfect place for online retailers to start their business. However, since Ornaz’s factory is in Mumbai, turnaround time is higher for operations. Finding the right talent on a tight budget was also a challenge for them.
“Gaining customer trust was tough too, but everything is getting resolved,” Manik says. For business development, Ornaz is doing strong digital and affiliate marketing, and event participation. On social media, they are running exclusive campaigns connecting with users and showcasing designs and offers.
Ornaz’s customer acquisition cost is high, but Manik says that they will become profitable by the end of FY19.
“More people are comfortable buying jewellery online, and the jewellery industry itself is growing at 20 percent annually. Our Try@home experience service gives a boost to our revenue too,” he says.
On an average, Ornaz gets 20 orders a day; the average ticket size is Rs 15,000.The target is to grow this number 10 times in the next six months. The company plans to raise funds to sustain future growth.
It was only recently that India’s e-commerce sector, which comprises less than 2 percent of total retail in the country, woke up to the precious jewellery segment. According to consultancy firm Alvarez & Marsal, the Indian precious jewellery market was estimated at Rs 2.6 trillion in 2015, of which the online channel had a less than 0.25 percent share ($39 billion).
The gems and jewellery market in India is home to more than 500,000 players, with the majority being small operators. Although Ornaz’s competitors are well funded – Caratlane with $52 million and BlueStone with $61 million – the online market is yet to be tapped and there is space for multiple players.
According to a recent report, India and China are the largest consumers of gold jewellery in the world. But it adds that while demand for gold jewellery (in volume) from India saw an improvement by 5 percent in 2015, it declined by 24 percent in 2016. Ornaz’s decision to focus on diamonds alongside gold gives them an obvious advantage. Although India only has a 7 percent market share in the diamond category, there is no direct competition in the vertical.
With growing internet penetration, India is the fastest growing e-commerce market in the world. According to a recent study by Forrester Research, the Indian market is expected to reach $64 billion by 2021, growing at a five-year CAGR of 31.2 percent. The general rise in online shopping will slowly but surely include high-ticket purchases like gold and diamonds.
Ornaz is keen to tap this market and add sparkle to the lives of Indians!