India-Africa Project Partnership: 9th CII- EXIM BANK Conclave March 17 - 19, New Delhi

Insatiable India


The Hermes showroom in Mumbai / credit - The Indian Express

By Jagmeeta Thind Joy / The Indian Express

Till about a decade ago, holidays overseas or indulgent aunts were perhaps the only way to bag (pun intended) a designer goodie. Today, of course, India tells a different story. With many international luxury labels having set up shop here, leading cities now offer high-end shopping in the neighbourhood, and sometimes at the doorstep too.



 How has the luxury fashion market in India evolved over the years? What is the Indian consumer's understanding of the term 'luxury'? What is the future of these brands in India? Answers to such questions are almost always peppered with terms such as "emerging" and "potential".


 

It has been reported that last year, the personal luxury goods market in India was estimated to be worth 1 billion euros. Though only 0.5 per cent of the global market, it is expected to grow from 20 to 30 per cent in the next five years. At this "opportune time", Yes Bank and Assocham, in close partnership with La Fondazione Altagamma and the Italian Embassy, envisaged the India Luxury Summit 2012 and presented the outcome of the first "Luxury Top Management Survey" for the Indian market. It had perspectives from luxury business leaders on the challenges put forth by the global economic slowdown and their plans to tap the 'India opportunity'.

 

The results were insightful: for one, China is fast on its way to becoming the world's second largest luxury market within the next five years. India is not too far behind, making it hot on the radar for leading international brands — be it in the luxury space of even premium or high street. "India is the next destination for brands after China as the industry is growing at an average of 20 per cent. Affluent Indians have large disposable incomes which they are willing to spend on a better life statement," says Sanjay Kapoor, managing director, Genesis Luxury. Established in 2008 for the marketing and distribution of international labels within India, it has brought to India British labels Paul Smith and Jimmy Choo, Italian haute leather-maker Bottega Veneta, Italian fashion label Etro, men's suit-makers Canali among others.

 

With high disposable incomes in the hands of young professionals, luxury is no longer the prerogative of the royalty or traditional business families. "A 21-year-old wants to experience luxury and we have noticed that those who have started early have grown with the market here," says Charu Sachdev, founder and CEO of TSG International Marketing, the exclusive retail, distribution and marketing partner in India for international designer labels like Alexander McQueen, DVF, Halston Heritage, Hervé Leger, Alice + Olivia, Lanvin and Stella McCartney. Interestingly, a majority of the CEOs surveyed by Yes Bank share the same outlook. "This burgeoning segment is not averse to spending and as a result of being well-travelled, is also fashion-conscious," states Rana Kapoor, founder, MD and CEO, Yes Bank and senior VP, Assocham.

 

While Delhi and Mumbai remain the most important shopping centres, cities like Kolkata, Chennai, Hyderabad, Bangalore and Pune are becoming important because of their large base of potential consumers. "Tier II cities have shown immense potential for luxury goods. Since it is not possible to have stand-alone stores, due to issues like lack of infrastructure, high rentals, e-commerce has helped bridge that gap," says Amit Rawal, founder and CEO, elitify.com, a premium style lounge for men that offers high-end brands like Ralph Lauren and Armani.

 

A strong online presence apart, "fine tuning and realigning of regulatory policies" would be integral to the growth of the luxury market in India. "Lack of adequate infrastructure and the prevalence of high duties make business for global luxury markets less conducive here," states Karan Ahluwalia, country head, Luxury Banking Group, Yes Bank, in the luxury report. A "wait and watch" approach to the evolving Indian market seems to be a common opinion. Equity infusion seems to be the most preferred expansion route .

 

Meanwhile, let's celebrate a decade of fine things from the world's best markets.

 



Send Feedback/Contribution