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Luxury has been an intrinsic part of India’s rich tradition and culture. Dotting the luxury landscape from time immemorial have been the artistic palaces, exquisite art, breathtaking ornamentation and lavish lifestyles. Indians still have the concept of luxury connected to their lives and we will not fall short of instances here. Today given India’s per capita GDP and the number of high net worth individuals, analysts estimate that the potential luxury market size in India is 120 per cent to 150 per cent larger than its current size compared to a corresponding figure of 10 percent to 15 percent for China. Infact, the luxury market in India is expected to grow at 21 per cent and treble by 2015.
A recent Merrill Lynch Capgemini Wealth management report estimated the number of individuals with a net of 700,000 Euros at 126,700. The report said the five-fold rise in the net worth and the increasing propensity to spend would have a long term impact on the luxury market in India.
The Indian luxury sector (spanning the gamut of apparel, accessories, watches, jewellery, supercars, yachts, hotels, spas and houses) represents a dormant volcano, one that has the potential to chart its own course to emerge as the global destination for luxury brands. The Indian luxury consumer has evolved rapidly, but along a path that is inherently different from those in other developing economies. The young Indian professional or business person is the consumer who represents the face of new luxury. This group has high levels of disposable income, is well-travelled and fashion-conscious with exposure to international trends. Also today’s Indian luxury consumer has moved beyond the metro, in fact cities such as Bangalore, Hyderabad, Pune, Ludhiana and Amritsar promise a ready market for luxury brands, evident in their purchasing power and predilection for luxury.
This growing consumerism can be attributed to more wealthy people, sheer surge in number of HNIs. India is creating a new generation of entrepreneurs, achievers and dreamers. They are not just born rich. There are new entrants like CEOs in their thirties, dot com chieftains, BPO mavericks, and entrepreneurs in myriad new businesses like technology and manufacturing.
This increase in consumerism has also seen enhanced consumption of non essential items, demand for luxury goods with no associated guilt of spending on luxury. This in turn has lured global luxury brands and suppliers to make a beeline for India. Its growing importance perhaps best lends itself through a recent instance when in December last year, Jimmy Choo celebrated its 15th anniversary globally and simultaneously in Milan, London and Mumbai with the launch of Crystal shoes and bag collection. As the luxury market in India evolves, luxury brand marketeers have woken up to serve a demanding, well-travelled and discerning Indian consumer.
The symbols of luxury abound. Today’s evolved consumer has developed and cultivated finer tastes evident in the sophistication of choice, be it fast cars, truly customized auto products, aqua toys or the rapidly rising population of boats and yachts.
Wealth, education, exposure, occupation . . . all of these and other factors impact where consumers are on the spectrum of affluence and the pursuit of an affluent lifestyle. The signs are clear. Supported by a strong economy, buoyant personal income trends and growing consumer eagerness to spend, the lifestyle products and services sector has been witnessing exemplary growth. On the one hand, Indians are getting richer younger and on the other, they are no longer shy of spending on themselves. This trend has been noticed by many international lifestyle companies and has resulted in an array of international luxury brands setting shop in India to cater to this segment of shoppers.